Trade-Based Money Laundering, Customs Compliance and the Stability of Nigeria's Trade Finance System

Publication Details

Publication Date

10/11/2026

Volume / Issue

Vol 1, Issue 6 (2026)

Article No.

062

Journal

British Journal of Contemporary Research

DOI

https://doi.org/10.67693/BJCR-4YF49X4B

Received

28 Oct 2026

Views

23

Downloads

15

Abstract

Trade-Based Money Laundering (TBML) poses a serious challenge to the integrity of international trade, customs administration and financial regulation. In Nigeria, the problem is particularly important because of the country’s extensive cross-border trade, foreign exchange pressures, informal trade routes and continuing efforts to modernise customs administration. In view of the above, this paper assessed TBML, customs compliance and the stability of Nigeria’s trade finance system. The paper adopted a qualitative documentary and analytical approach based on academic literature, legislation, policy documents, regulatory reports and institutional publications. The materials were reviewed thematically to assess the nature of TBML in Nigeria, the effectiveness of customs and regulatory reforms, persistent institutional weaknesses and their implications for trade finance. The findings showed that, trade mis-invoicing, false declarations and related forms of trade manipulation remain important areas of vulnerability. Nigeria has made notable progress through the Nigeria Customs Service Act 2023, customs digitalisation, the B’Odogwu Unified Customs Management System and improvements in the wider anti-money laundering framework. However, fragmented information systems, uneven enforcement capacity, limited interoperability, human capacity constraints and weaknesses in inter-agency coordination continue to reduce regulatory effectiveness. Based on the findings, it was concluded that, the more pressing challenge lies in the effective integration and implementation of existing reforms. Therefore, the paper suggested that, stronger coordination between customs authorities, financial institutions and financial intelligence agencies is therefore essential to reducing TBML risks and improving confidence in Nigeria’s trade finance system.

License

This article is published under the Creative Commons Attribution 4.0 International License . Free to read, share, and adapt with attribution.