Nigerian Financial Intelligence Unit (NFIU) has said that terrorist financiers in Nigeria are increasingly exploiting proxy bank accounts, pre-registered SIM cards and phone numbers linked to deceased persons to conceal the identities of individuals controlling illicit funds.
The development is raising fresh concerns over gaps in Nigeria’s financial identification architecture, despite ongoing efforts by regulators and identity-management authorities to strengthen the linkage between bank accounts, Bank Verification Numbers (BVN), National Identification Numbers (NIN) and SIM cards.
The NFIU disclosed the findings in its 2025 Annual Report, where it identified disconnected SIM-BVN linkages, weak customer identification controls and limited oversight of some digital financial services among emerging enablers of financial crime and terrorist financing.
According to the intelligence agency, terrorist facilitators have found ways around the security mechanisms designed to connect a bank customer’s mobile number with their verified financial identity.
The agency said the use of pre-registered SIM cards, SIMs registered in the names of deceased persons and gender-based proxies enables the actual controllers of illicit accounts to remain hidden from investigators.
“They bypass the security link between SIM cards and Bank Verification Numbers (BVNs) by using pre-registered SIMs, SIMs registered to deceased people, or SIMs tied to gender-based proxies,” the NFIU said.
The agency explained that the practice effectively breaks the trail investigators would normally follow when attempting to identify the person behind suspicious financial transactions.
“This severs the audit trail: when a transaction is flagged, investigators trace the phone to an unrelated person, letting the real facilitator stay anonymous and continue operations,” it said.
The disclosure highlights the growing challenge facing Nigeria’s financial intelligence and law-enforcement agencies as terrorist financing increasingly moves through digital and technology-enabled channels.
Beyond the manipulation of SIM registration, the NFIU identified proxy bank accounts as another mechanism used by terrorist financiers to separate themselves from illicit funds.
The agency said accounts are sometimes opened in the names of women while male commanders and logistics managers secretly control the accounts.
According to the NFIU, the practice exploits social and cultural assumptions that may make women less likely to attract suspicion during financial investigations.
Wives, sisters and female associates may be used as fronts through which funds are received, transferred or withdrawn, thereby creating a layer between the actual terrorist financier and the financial account.
The agency described the practice as “identity laundering.”
“This tactic functions as identity laundering: women’s accounts are managed by men who hold ATM cards, mobile-banking credentials, and PINs, while the women often remain unaware of the transactions and volumes,” the report stated.
The revelation also introduces an important distinction for financial institutions and investigators: the name attached to an account may not necessarily identify the person exercising effective control over the funds.
Where account credentials, mobile-banking access or payment instruments are controlled by another individual, investigators may initially follow the identity of the registered account holder rather than the person actually directing the transactions.
The NFIU’s findings come as Nigeria expands the use of digital banking, electronic payments and mobile financial services.
