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FATF's listing approach and the collective action problem: assessing Nigeria's legal and enforcement conundrum
Book chapter   Peer reviewed

FATF's listing approach and the collective action problem: assessing Nigeria's legal and enforcement conundrum

Legal Transplantation of Global Anti-Money Laundering Standards, pp.115-156
Edward Elgar Publishing
14/05/2026

Abstract

Criminal Law and Justice Global and Transnational Law Law and Development
There is a profound sense of anxiety as the FATF's listing approaches embolden deep disagreements and cultural aberrations. Finalising contemporary debates on the effectiveness of the FATF's methodology and listing approach to controlling money laundering and terrorist financing in developing countries, leaves a very odd cocktail of salutary despondency. This chapter examines the FATF's methodology in relation to the network of legal and institutional structures designed in Nigeria to meet the FATF's standards and compliance requirements by presenting three arguments. Firstly, the uncompromising absence of an adaptive framework to meet the legal, institutional, political, and cultural uniqueness of developing countries is the basis for misalignments of standards and ineffectiveness of the listing approach as a control measure. In other words, specific recommendations, standards, and control measures lack sufficient flexibility to accommodate the peculiar circumstances of some developing countries. Secondly and directly linked to the first argument is the political and cultural resistance to transplantation of standards that are considered incongruent with entrenched domestic ideals. This means a deliberate sabotage of the FATF's standards as domestic and regional power structures seek to retain their positions and privileges. Therefore, this chapter makes the final arguments for a context-sensitive and adaptive framework to support standards setting, transplantation, and execution of the FATF's recommendations and control measures to ensure their effectiveness in developing countries. To uncover the thematic strands of the FATF's standards against the domestic situations of developing countries, the chapter utilises contextualism as a basis for analysing the structural incidences in their framing. There is a need to explore the deep-seated dimensions of the text, language, and structures that embody the FATF's prescriptions and how they reflect on the current listing approaches in relation to the unique situations of developing countries. Nigeria and its financial intelligence framework will be used to provide a context and give practical validity to research and access to fundamental disparities in the frameworks between FATF and developing countries. The paper proposes, develops, and recommends a Three-Step Three-Elements Adaptive Contextualist model to enable appropriate contextual assessment of member countries to enhance the effectiveness of the FATF's methodology and listing approach.
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