SEC orders capital market operators to cut North Korea, Iran ties
The Securities and Exchange Commission (SEC) has ordered all capital market regulated entities in Nigeria to terminate correspondent banking relationships and restrict business dealings involving North Korea and Iran, as part of sweeping anti-money laundering and counter-terrorism financing measures that take immediate effect.
The directive was disclosed in a circular to all capital market regulated entities, dated August 14, 2026.
The circular implements updated statements issued by the Financial Action Task Force (FATF) during its February 2026 plenary session, which identified jurisdictions posing significant risks related to money laundering, terrorist financing, and proliferation financing.
The SEC said the directive was issued pursuant to the Investments and Securities Act, 2025, and the SEC AML/CFT Rules and Regulations, requiring all capital market regulated entities (CMREs) to immediately implement enhanced restrictions and monitoring measures for transactions linked to designated high-risk jurisdictions.
For the Democratic People’s Republic of Korea (DPRK), the Commission directed all CMREs to completely sever financial relationships with DPRK-linked institutions.
The circular instructed firms to terminate all correspondent banking relationships with financial institutions incorporated in, owned, or controlled by persons or entities in North Korea.
The commission ordered CMREs to do the following; “Terminate all correspondent banking relationships with financial institutions incorporated in, owned, or controlled by persons or entities in the DPRK.
Ensure that no subsidiaries, branches, or representative offices of DPRK financial institutions are established or maintained within their operations; and
Restrict or, where appropriate, refuse business relationships and transactions involving DPRK nationals, entities, government bodies, or persons acting on their behalf.”
In practical terms, the directive effectively cuts off formal banking and capital market channels connected to North Korean institutions within Nigeria’s regulated capital market.
For Iran, the SEC ordered capital market firms to refuse transactions involving Iranian financial institutions.
“Refuse to process or facilitate transactions with Iranian financial institutions and decline to establish or maintain subsidiaries, branches, or representative offices of such institutions in Nigeria,” the statement reads in part.
The Commission also directed firms to refrain from establishing or operating branches, subsidiaries, or representative offices in Iran where deficiencies in the country’s anti-money laundering, counter-terrorism financing, and counter-proliferation financing framework may compromise compliance obligations.
The instruction means Nigerian capital market operators are expected to avoid institutional financial relationships with Iranian financial institutions and prevent operational exposure that could create regulatory compliance risks.
Myanmar was treated differently from North Korea and Iran. Rather than imposing an outright restriction, the SEC ordered firms to apply enhanced due diligence measures for Myanmar-related business.
