Securities and Exchange Commission (SEC) has directed capital market operators in Nigeria to restrict business dealings and banking relationships involving North Korea and Iran.
Gatekeepers News reports that the directive was contained in a circular dated August 14, 2026, issued to all capital market regulated entities as part of measures to strengthen compliance with anti-money laundering, counter-terrorist financing and counter-proliferation financing requirements.
For North Korea, officially known as the Democratic People’s Republic of Korea (DPRK), the SEC directed operators to terminate correspondent banking relationships with financial institutions from the country.
The commission also ordered capital market operators to ensure that no subsidiaries, branches or representative offices of DPRK financial institutions are established or maintained within their operations.
In addition, operators were told to restrict or, where necessary, refuse business relationships and transactions involving North Korean nationals, entities, government bodies or individuals acting on their behalf.
For Iran, the SEC instructed capital market operators to refuse to process or facilitate transactions involving Iranian financial institutions. They were also directed not to establish or maintain subsidiaries, branches or representative offices of Iranian financial institutions in Nigeria.
The commission further advised operators against establishing or operating branches, subsidiaries or representative offices in Iran where weaknesses in the country’s anti-money laundering, counter-terrorist financing and counter-proliferation financing framework could expose them to compliance risks.
The directive is part of the regulator’s broader efforts to ensure that Nigeria’s capital market operators comply with international financial safeguards and prevent the market from being used for illicit financial activities.
The SEC also directed capital market regulated entities to apply enhanced due diligence to dealings involving Myanmar, with the level of scrutiny expected to reflect the risks associated with transactions involving the country.
The latest directive reinforces existing requirements for capital market operators to conduct ongoing due diligence on clients and scrutinise transactions to ensure they are consistent with customers’ profiles, businesses and sources of funds. Nigerian regulations also prohibit capital market operators from establishing correspondent relationships with high-risk foreign banks such as shell banks.
The SEC’s action comes as Nigerian financial regulators continue to strengthen the country’s compliance framework against money laundering, terrorism financing and proliferation financing, while seeking to protect the integrity of the capital market.
