The Nigeria Financial Intelligence Unit (NFIU) has uncovered new methods allegedly being used to finance terrorist activities in Nigeria, including crowdfunding networks, proxy bank accounts and telephone numbers registered to deceased persons.
The findings are contained in the NFIU’s 2025 Annual Report, which highlighted the growing sophistication of terrorist financiers and their use of technology and cross-border financial channels.
According to the report, foreign-based facilitators have been using social media to solicit donations disguised as humanitarian assistance or educational support before transferring the funds to terrorist operatives in Nigeria.
The NFIU said donors are typically encouraged to contribute between $50 and $500, with the relatively small amounts designed to avoid triggering automated anti-money laundering alerts.
The money is then accumulated in a master account controlled by a senior member of the network living abroad.
Once the funds reach a certain level, they are reportedly broken into dozens of smaller transfers and sent through International Money Transfer Operators and remittance applications to money mules in Nigeria.
The agency identified students, small-business owners and relatives among those allegedly used as intermediaries.
After receiving the money, the mules may convert it to cash or use it to purchase items that could have legitimate or operational uses, including motorcycles, fertilisers and satellite internet equipment. The funds can also be transferred through mobile banking to logistics managers and field operatives.
Terrorists use women’s accounts as proxies
The NFIU also identified the use of bank accounts opened in women’s names as another emerging terrorist financing technique.
The report said male commanders or logistics managers may secretly control accounts belonging to wives, sisters or other female associates, exploiting the perception that women may be less likely to attract suspicion.
In some cases, the women may not even be aware of the transactions taking place in their accounts.
According to the NFIU, men may possess the ATM cards, mobile banking credentials and PINs linked to such accounts, effectively separating the funds from the actual beneficiaries.
The agency described the practice as a form of identity laundering.
Dead persons’ phone numbers used for banking
The financial intelligence agency also found that terrorist facilitators were using telephone numbers that were not registered to the actual bank account holders or beneficiaries.
It said pre-registered SIM cards, numbers registered to deceased persons, and SIMs connected to gender-based proxy accounts were being used for mobile banking and transaction alerts.
The technique can make it difficult for investigators to establish the real identity behind a transaction by creating a disconnect between the account, SIM card and Bank Verification Number (BVN).
Coded transaction descriptions
The NFIU further identified the use of detailed or coded transaction descriptions to conceal terrorist financial activities.
It said groups linked to the Islamic State West Africa Province (ISWAP) were among those using professional-looking transaction narrations as part of an internal financial tracking system.
Frequent payments relating to logistics were reportedly sent from single sources to several recipients, suggesting a structured financial management system.
However, the report also noted that some facilitators deliberately used harmless words, codes and combinations of letters and numbers in transaction descriptions.
The coded language may also involve switching between languages to avoid automated banking systems designed to flag terms associated with terrorism, weapons or extremist activities.
Financial crime and public funds remain major risks
The NFIU said its analysis in 2025 showed an increasingly connected threat involving financial crime, technology and cross-border transactions.
Fraud remained a major underlying offence, with increasing cases involving Ponzi schemes, fraudulent crowdfunding, cryptocurrency investment scams and hacking-related fraud.
The agency said criminals were exploiting weaknesses in fintech account-opening procedures, including lower-tier accounts with limited identification requirements, while digital platforms allowed fraudulent schemes to recruit victims and move money quickly.
The report also identified weaknesses in the management of public funds, including the diversion of state and local government money through accounts belonging to finance officers and third parties.
Procurement processes and cash transactions were identified as particular areas of concern because they can make financial trails more difficult to follow and illicit assets harder to trace.
The NFIU said its findings had been converted into advisories, alerts and intelligence reports for relevant authorities, financial institutions and policymakers.
Experts call for stronger intelligence sharing
Security expert Chidi Omeje urged Nigeria’s security and financial intelligence agencies to strengthen their strategies to keep pace with increasingly sophisticated criminal networks.
He called on the Nigeria Police Force, Department of State Services and financial regulatory authorities to intensify efforts to track suspicious financial movements and follow the money trail.
Omeje said criminal groups were constantly developing new methods to bypass existing security systems and urged authorities to stay ahead of them through intelligence-led operations.
Another security analyst, Lawrence Alobi, called for stronger information sharing between security agencies and financial institutions.
Alobi said banks should improve their verification systems and cooperate closely with security agencies to identify fraudulent accounts.
He warned that financial institutions found to have deliberately assisted illicit activities should face sanctions.
He also stressed the need for banks to establish the identity of genuine account holders and prevent proxy arrangements from being used to facilitate illegal financial transactions.
According to him, intelligence agencies must also ensure that financial institutions are held accountable whenever weaknesses in their systems are exploited by criminal networks.
