An expert in the real estate industry, Mallam Bature Ali Muhammad has lamented the activities of money launderers exploiting the several loopholes in the industry.
He raised the concern while delivering a paper titled “Asset Valuation As Anti-Corruption Tool: The Nigerian Experience” during the 53rd Annual conference of the Nigerian institution of Estate Surveyors and Valuers (NIESV) in Ilorin the Kwara State capital, North Central Nigeria.
Muhammad, a Lecturer in the Department of Estate Management and Valuation, Nuhu Bamalli Polytechnic Zaria, Kaduna State, north west Nigeria, disclosed that lack of market transparency in the Nigerian real estate market is one of the loopholes which money launders exploit.
Muhammad who is also the 2nd vice-president of the Institution, further lamented that the country is performing poorly in the world transparency index as it remains in second to the last category (low transparency), ranking 67th out of 100 countries in the JLL 2018 transparency index.
He, however, acknowledged that Nigeria’s current 67th position is an improvement to its previous 80th position, noting that there is still room for the country to improve its market transparency as it still lags behind other African nations.
“While this is an improvement from the 2016 transparency report where Nigeria was ranked 80, there is still the need to improve on market transparency as Nigeria still lags behind other African countries such as South Africa, Botswana, Mauritius, Kenya, Zambia, Egypt and Morocco.” he added.
Quacks
Muhammad noted that some of the challenges facing Real Estate industry which include operations of quacks, high level of confidentiality as well as enormous power and immunity enjoyed by politicians are contributing majorly to the problem of money laundering in the industry.
According to him, while the Estate Surveying and Valuation profession is based on the springboard of honesty and devotion, the patronage of quacks who are untrained and lack professional integrity, accountability, and probity, would continue to constitute a stumbling block in fighting money laundering in Nigeria.
Muhammad explained that despite the fact that most Estate Surveyors and Valuers assume that they owe their clients a high level of confidentiality, it has proved to be a major challenge to mitigating money laundering within the sector stressing that it must be known that such duty doesn’t hold where there is a case of illegality in real estate transactions.
“The enormous power and immunity enjoyed by most corrupt persons who are often politicians put fear in most Estate Surveyors and Valuers in a bid to protect their lives and those of their families. ” he noted.
The Expert also noted that nefarious activities of money launderers in Real Estate industry will be reduced to the barest minimum with a more transparent real estate market
“A more transparent real estate market accrues several benefits such as market monitoring, control and regulation which will aid investigation for law enforcement agencies and also serve as a deterrent to potential money launderers.”
A Well Integrated Market
He also urged other Nigerian real estate professionals to make frantic effort to move Nigeria’s real estate market from its opaque stage to a well-integrated market which according to him, will go a long way in curbing the problem of money laundering in the country.
“These will require that a centralised valuation record system is updated after a new valuation is conducted, and property letting and sales transactions and records are also kept and updated after every new transaction is completed”, he declared.
Furthermore, Muhammad prescribed asset declaration as a viable tool that can help in the fight against corruption.
He said, as a tool against corruption, asset declaration plays a dual function and plays a preventive function of helping to anticipate and resolve potential conflicts of interest.
According to him, it similarly plays an investigative function by providing valuable information vital to uncovering gross misconduct and illicit enrichment by public officials.
He also added that in most cases, assets declaration illustrates irregularities between the actual assets of the public officials and their salaries.
“Therefore, valuation as a tool in addressing corruption is the use of economic and financial analysis to assess the value of a project or asset to help identify and prevent corrupt activities as this tool can be used to detect irregularities in pricing and bidding processes, identify misappropriation of funds, identify fraudulent activities, and assess the impact of corruption on economic development” he stated.
The Expert said by using valuation techniques, governments, businesses, and other stakeholders can identify and mitigate the risks associated with corruption and improve their decision-making processes while valuation can also be used to assess the financial impact of corrupt activities and to identify potential sources of illegal funds.
“A valuation can equally be used to identify areas of potential losses due to corrupt activities and to develop strategies to reduce the risk of corruption. In addition, valuation can be used to strengthen the effectiveness of anti-corruption initiatives and monitor their progress” he said.
Transparency
Two other renowned property valuers, Dr Sopon Pornchokchai and Mr. Peter Bolton King from Thailand and the United Kingdom respectively, also gave virtual speeches.
Dr Sopon Pornchokchai, a property valuer and real estate researcher in the ASEAN Region, Africa and South America, emphasised the important role that ombudsmen play in monitoring and ensuring transparent process, noting that valuation firms should be inàdependent of their clients to ensure that desired objectives are achieved .
They also emphasized the need to scrutinize to get the money sources of information.
In his welcome address the President and Chairman of the Council, Johnbull Amayaevbo disclosed that the institution in it’s 54 years of existence has in line with it’s aims and objectives successfully promoted the general interests of the profession .
According to him, the theme is particularly relevant as the world continues to confront corruption which distorts policy decisions, weakens economic growth, deters investment and undermines human development.
The Chairman, Kwara state chapter, Oyedepo Olalekan said such conference is usually an avenue where members have rare privileges and opportunity to ungrade and widen their knowledge.
Similarly, the National Publicity Secretary of the institution, Toyin Aluko disclosed that the conference has curated a captivating exhibition featuring cutting-edge technologies, innovative products, and services that are shaping the future of assets valuation.
Among dignataries expected to grace Thursday’s official opening ceremony are the Kwara State Governor, Mallam Abdul Rahman AbdulRazaq, the Former President of Ghana, John Dramani Mahama while the Keynote address will be delivered by Bishop Matthew Hassan Kukah.
