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LG Autonomy: FG Wins Case Against State Governors

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Federal Government and the Nigerian Financial Intelligence Unit (NFIU) have won the case against the state governors over the financial autonomy from the Local Government joint account.

Justice Inyang Ekwo of the Federal High Court delivered the ruling on Monday in favour of the Federal Government.

The NFIU had in June 2019 issued guidelines aimed at curbing crime vulnerabilities created by cash withdrawals from local government accounts by various state governments.

The Nigerian Governors Forum sued the FG and NFIU for interfering with state government powers to initiate transactions on Local Government Joint accounts citing provisions of the 1999 constitution.

The NFIU issued a guideline on money laundering risk and vulnerabilities advising all banks not to honour transactions from joint accounts.

It directed that the States/Local Governments Joint Accounts should use only for receiving funds and subsequently transferring them to Local government accounts only.

The guidelines also reduced cash withdrawal from local government accounts to five hundred thousand Naira daily.

Immediately after the guidelines came into place, most local governments across the country stopped facing challenges in the payment of staff salaries.

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