EFCC URGES OYO TO REGULATE NON-PROFITS AS TERRORISM-FINANCING RISK ASSESSMENT DEEPENS
By Iroyin Yoruba Television News Desk
The Economic and Financial Crimes Commission has called on the Oyo State Government to establish a stronger legal framework for the registration, monitoring and supervision of non-profit organisations operating in the state, warning that gaps in oversight could potentially be exploited by criminal networks seeking to move or disguise funds intended to support terrorism.
The call was made as part of a wider national assessment of terrorism-financing risks within Nigeria's non-profit sector, with Oyo State serving as one of the locations for the South-West component of the exercise.
The assessment, which began in Ibadan on September 1, 2026, is examining the vulnerabilities that may exist within the non-profit sector and how government agencies, regulators and legitimate organisations can work together to prevent abuse without disrupting humanitarian and charitable activities.
The EFCC said the objective is not to portray non-profit organisations as sources of terrorism financing.
Rather, officials said the purpose is to identify potential weaknesses that could be exploited by individuals or organisations attempting to move money through legitimate-looking channels.
The distinction is important because non-profit organisations perform significant social functions in Nigeria.
They provide humanitarian assistance, support vulnerable people, contribute to education and healthcare, respond to emergencies, assist communities affected by poverty and displacement, and sometimes provide services where government capacity is limited.
Many organisations depend on donations from individuals, businesses, international development partners and charitable institutions.
The concern raised by financial-crime authorities is that the same financial channels that allow legitimate organisations to receive and distribute donations could potentially be abused by criminals if appropriate safeguards are absent.
The EFCC therefore wants Oyo State to create a legal and regulatory framework that would make it easier to identify legitimate organisations, understand their activities, monitor compliance and respond to suspicious financial activity.
The recommendation forms part of a broader national effort to strengthen Nigeria's systems for combating money laundering and terrorism financing.
WHY THE EFCC IS FOCUSING ON NPOs
Non-profit organisations occupy an unusual position within the financial and social environment.
Unlike ordinary commercial businesses, many NPOs are established primarily to provide social, humanitarian, religious, educational or charitable services rather than to generate profits for owners.
Their work often depends on donations and grants.
Money can therefore move through their accounts from multiple sources and eventually reach beneficiaries in different communities.
That is generally a legitimate and necessary part of humanitarian work.
However, the nature of the sector can create vulnerabilities if financial controls are weak.
For example, an organisation may receive funds from donors, transfer money to local partners, distribute cash or goods to beneficiaries, or operate projects in areas where formal financial infrastructure is limited.
Criminal actors could theoretically attempt to exploit such arrangements.
The objective of the EFCC's risk assessment is therefore to understand where those vulnerabilities exist and determine how they can be reduced.
The agency is not saying that non-profit organisations generally finance terrorism.
Instead, it is asking regulators and organisations to identify circumstances in which legitimate humanitarian channels could be misused.
This is consistent with the broader international approach to combating terrorist financing.
OYO ASKED TO CREATE A LEGAL FRAMEWORK
The EFCC Chairman, Ola Olukoyede, urged the Oyo State Government to enact legislation that would provide for the registration, monitoring and supervision of non-profit organisations within the state.
The recommendation was communicated through the Lagos Zonal Coordinator of the Special Control Unit Against Money Laundering and the team lead for the 2026 National Terrorism Financing Risk Assessment delegation for the non-profit sector in South-West Nigeria, Assistant Commander of the EFCC, Ibinabo Amachree.
The proposed framework would give the state a clearer basis for understanding which organisations are operating within its territory and what activities they undertake.
It could also establish mechanisms for compliance and information sharing.
The objective is not simply to create another administrative requirement.
The EFCC's argument is that effective oversight can make it easier to identify genuine organisations while detecting unusual or suspicious activity.
A functioning registration system can also help government agencies distinguish between established organisations with identifiable leadership and financial structures and entities whose ownership, purpose or activities are unclear.
WHY REGISTRATION MATTERS
Registration is one of the basic tools available to regulators.
When an organisation is properly registered, authorities can obtain information about its legal identity, leadership, address, objectives and governance structure.
This does not automatically mean that a registered organisation is legitimate forever.
Organisations can change.
Leadership can change.
Activities can change.
Financial arrangements can change.
That is why registration needs to be accompanied by appropriate monitoring and compliance.
Nevertheless, knowing who operates an organisation provides an important starting point.
Without reliable records, it can become difficult for authorities to investigate suspicious transactions or determine who is responsible for an organisation's activities.
The proposed Oyo framework could therefore strengthen the state's ability to maintain an accurate picture of the non-profit sector.
MONITORING DOES NOT MEAN CRIMINALISING CHARITY
One of the most important messages emerging from the national risk-assessment exercise is that legitimate humanitarian work should not be unnecessarily disrupted.
Non-profit organisations frequently operate in communities where government agencies may have limited reach.
They may provide food, medical assistance, educational support, shelter, skills training and other services.
In areas affected by poverty or displacement, their contribution can be substantial.
Any regulatory system that makes legitimate humanitarian activity unnecessarily difficult could create unintended consequences.
The objective should therefore be proportionate regulation.
Authorities need to identify genuine risks without treating every charitable organisation as suspicious.
This requires consultation with the sector.
It also requires clear rules.
An organisation should understand what information it must provide, what financial records it needs to maintain, how often it must report and what constitutes a compliance concern.
Clear regulation can be more effective than vague requirements.
THE ROLE OF SCUML
The Special Control Unit Against Money Laundering plays an important role in Nigeria's anti-money-laundering and counter-terrorism-financing framework.
SCUML's mandate includes registration and supervision of designated non-financial businesses and professions in relation to anti-money-laundering and counter-terrorism-financing requirements.
The unit operates within the EFCC's operational structure while carrying out its regulatory responsibilities.
Its broader objective is to protect sectors outside traditional banking from being exploited for financial crimes.
That role becomes particularly important when financial transactions take place outside conventional banking environments.
Money laundering and terrorism financing can involve complex networks of individuals, businesses and organisations.
Regulators therefore need information from multiple sectors.
The NPO risk assessment is part of this wider effort.
WHAT THE RISK ASSESSMENT IS TRYING TO FIND
A national risk assessment is essentially an exercise in identifying vulnerabilities.
Officials need to ask questions such as:
How are organisations funded?
Where does their money come from?
How is money transferred?
Who controls financial decisions?
What records are maintained?
How are beneficiaries identified?
Are funds distributed through bank accounts or cash?
Are organisations operating in high-risk areas?
Do organisations work with overseas partners?
Are financial transactions independently reviewed?
Do organisations have internal controls?
How are suspicious transactions reported?
These questions do not imply wrongdoing.
They are part of understanding the overall risk environment.
An organisation with strong governance and transparent financial records may present a lower risk than an organisation with unclear ownership, unexplained transactions and weak internal controls.
The assessment therefore seeks to identify patterns rather than automatically accuse organisations.
WHY TERRORIST NETWORKS SEEK FINANCIAL CHANNELS
Terrorist organisations require resources to operate.
Money can be used for logistics, transportation, communications, recruitment, equipment, safe houses and other activities.
The amounts required can vary significantly.
Some terrorist operations may involve substantial funding.
Others may require relatively small amounts.
This means that preventing terrorism financing is not simply a matter of blocking large international transfers.
Authorities also need to identify smaller transactions that may become significant when viewed as part of a wider network.
Criminal organisations may therefore attempt to exploit different financial channels.
The purpose of counter-terrorism-financing controls is to make those channels more difficult to abuse.
WHY NON-PROFITS CAN BE VULNERABLE
The vulnerability of an organisation depends on many factors.
A charity operating in a conflict-affected or high-risk area may face different risks from a local organisation running a small educational programme.
An organisation that receives international donations may have a different financial profile from one funded entirely by local contributions.
A group that distributes cash may face different risks from one that purchases and distributes goods directly.
The risk assessment therefore needs to be detailed.
It should not assume that every NPO faces the same level of exposure.
Instead, authorities can use a risk-based approach.
Higher-risk organisations or activities may require greater scrutiny.
Lower-risk organisations can potentially operate under simpler requirements.
This approach helps protect the sector from excessive regulation while maintaining appropriate safeguards.
THE IMPORTANCE OF FINANCIAL RECORDS
One of the simplest ways an organisation can protect itself is by maintaining accurate financial records.
Records should show where money comes from and how it is spent.
Receipts, bank statements, donor information, payment records and project documentation can help establish the legitimate purpose of transactions.
Good records also protect organisations from false accusations.
If an organisation is accused of receiving or transferring suspicious funds, clear records can help demonstrate what actually happened.
Transparency therefore benefits both regulators and legitimate NPOs.
Organisations should know that financial documentation is not merely paperwork.
It can become important evidence demonstrating how an organisation operates.
DONOR DUE DILIGENCE
Another important area is donor verification.
An organisation should have procedures for understanding who provides significant donations.
This does not mean that every small donation requires a complex investigation.
But larger or unusual donations may require additional checks.
The organisation should be able to identify the donor and understand the purpose of the contribution.
If a donor imposes unusual conditions or requests that money be transferred through unexplained channels, that should raise questions.
Non-profits also need to be cautious about accepting funds from individuals or entities whose identities cannot be established.
A transparent donation system protects the organisation's reputation.
It also makes it harder for criminals to use the organisation as a financial intermediary.
BENEFICIARY VERIFICATION
The same principle applies to beneficiaries.
Humanitarian organisations need to know who they are assisting.
In emergency situations, perfect identification may not always be possible.
However, organisations should have reasonable procedures for identifying beneficiaries and documenting the distribution of funds, goods or services.
This is especially important where significant amounts of money or valuable materials are being distributed.
Proper documentation can help prevent diversion.
It can also help organisations demonstrate that their resources reached the intended communities.
CASH TRANSACTIONS PRESENT ADDITIONAL CHALLENGES
Cash remains important in many Nigerian communities.
Some people do not have easy access to formal banking services.
Humanitarian organisations operating in rural or difficult areas may therefore need to use cash under certain circumstances.
However, cash transactions can be harder to trace than electronic transfers.
This does not mean that cash is inherently suspicious.
It means organisations using cash need stronger documentation.
They should record who received the money, why it was provided, how much was distributed and who authorised the transaction.
Such controls can reduce the risk of funds disappearing without explanation.
INTERNATIONAL DONATIONS
Many Nigerian NPOs receive money from international partners.
International funding can support major humanitarian programmes.
It can also introduce additional compliance requirements.
Organisations may need to comply with both Nigerian regulations and donor requirements.
Funds may pass through international banks before reaching Nigeria.
The organisation may also be required to provide detailed financial reports to its international partners.
These systems can strengthen transparency when properly implemented.
However, they can also become complicated.
Organisations need staff and governance systems capable of managing the requirements.
The proposed state-level framework should therefore be designed in a way that complements existing federal and international obligations rather than creating unnecessary duplication.
OYO'S POSITION IN THE SOUTH-WEST ASSESSMENT
The Oyo exercise is part of a wider South-West assessment.
The region contains a large number of civil society and non-profit organisations operating across different sectors.
They work in education, healthcare, poverty reduction, community development, women's empowerment, youth development, human rights, humanitarian relief and other areas.
Ibadan is also a major centre for civil society activity.
The city hosts numerous organisations and institutions working on social and development issues.
Conducting a risk assessment in Oyo therefore provides an opportunity to understand the sector within one of the region's major administrative and economic centres.
The findings can contribute to broader national policy.
THE THREE-DAY EXERCISE
The assessment exercise began on September 1 and was structured as a three-day engagement.
It brought together relevant stakeholders to examine the risks facing the sector.
The approach reflects the idea that regulators cannot properly assess a sector without speaking to the people operating within it.
NPOs have practical knowledge of how donations move, how humanitarian projects are implemented and what difficulties organisations face.
Government agencies have knowledge of legal and regulatory requirements.
Financial institutions understand transaction patterns.
Law-enforcement agencies understand criminal risks.
Bringing these perspectives together can produce a more accurate assessment.
WHY CONSULTATION WITH NPOs MATTERS
A regulatory framework developed without consultation could create unnecessary difficulties.
For example, a small community organisation may not have the same administrative capacity as a large international NGO.
If the same reporting requirements are imposed on both without considering their different capacities, smaller organisations could struggle to comply.
That does not mean smaller organisations should be exempt from all safeguards.
It means requirements should be proportionate.
Consultation allows regulators to understand these realities.
It can also help identify practical ways to improve compliance.
NPOs can tell authorities where existing procedures are difficult to implement.
Regulators can explain why certain information is necessary.
Together, they can develop systems that protect both national security and legitimate humanitarian work.
INTERNATIONAL STANDARDS
Nigeria's counter-terrorism-financing framework is also influenced by international standards.
The Financial Action Task Force has developed recommendations relating to terrorism financing and the protection of non-profit organisations from abuse.
The objective is to ensure that countries can prevent criminal exploitation without unnecessarily restricting legitimate civil-society activity.
Nigeria has established legal and regulatory mechanisms addressing money laundering and terrorism financing.
The challenge is implementation.
A law on paper does not automatically prevent financial crime.
Authorities need effective institutions, trained personnel, accurate information and cooperation from regulated sectors.
The Oyo proposal therefore needs to be understood as part of a larger implementation effort.
NIGERIA'S EXISTING LEGAL FRAMEWORK
Nigeria already has laws dealing with terrorism financing and money laundering.
The Terrorism Prevention and Prohibition Act, 2022, contains provisions relating to terrorism financing and terrorist property.
The Money Laundering (Prevention and Prohibition) Act, 2022, also provides a broader framework for combating money laundering.
SCUML maintains regulations and guidance covering various sectors subject to anti-money-laundering and counter-terrorism-financing obligations.
The existence of these federal laws means that the proposed Oyo legislation would need to complement the national framework.
It should not create conflicting requirements.
Instead, state-level registration and monitoring could provide additional information and oversight relevant to organisations operating within Oyo.
WHY STATE GOVERNMENTS CAN PLAY A ROLE
Although terrorism and financial crime are national issues, state governments have direct knowledge of organisations operating within their territories.
State agencies interact with community organisations.
They may issue permits or approvals.
They work with charities during emergencies.
They understand local community structures.
A state-level registration mechanism can therefore help create a clearer picture of local organisations.
Information can then be shared with relevant federal authorities where legally appropriate.
This kind of cooperation can strengthen national security without placing all responsibility on one institution.
PROTECTING HUMANITARIAN WORK
The strongest argument for careful regulation is that legitimate humanitarian work must not suffer.
Nigeria has communities facing poverty, displacement, insecurity and limited access to essential services.
Non-profit organisations often respond quickly to these needs.
They may provide food, medical supplies, education, shelter and other support.
If excessive regulation makes it difficult for legitimate organisations to operate, vulnerable communities could suffer.
The regulatory objective should therefore be to make abuse difficult while making legitimate compliance straightforward.
That requires clear rules, efficient registration systems and predictable oversight.
THE DANGER OF OVER-REGULATION
There is also a risk that poorly designed regulation could create unnecessary bureaucracy.
If organisations are required to submit large amounts of information repeatedly to different agencies, administrative costs could rise.
Small organisations could struggle to keep up.
Some groups might reduce their activities.
Others might operate informally rather than going through official channels.
That would defeat the purpose of regulation.
A good framework should therefore focus on information that is genuinely relevant to risk.
Digital systems could also reduce administrative burdens.
Where information has already been submitted to one government institution, agencies should explore lawful ways of sharing it rather than repeatedly demanding the same documents.
THE ROLE OF BANKS
Financial institutions can also contribute to preventing abuse.
Banks and other financial institutions often see transactions before regulators do.
They may identify unusual patterns, unexplained transfers or other indicators that require attention.
NPOs should therefore maintain good relationships with their financial institutions.
They should provide accurate organisational information and ensure that their accounts are properly controlled.
Banks, in turn, need to distinguish between legitimate humanitarian transactions and genuinely suspicious activity.
An organisation receiving large donations is not automatically suspicious.
The context matters.
TRAINING NPO STAFF
Regulation is most effective when people understand it.
Many NPO staff members are experts in humanitarian work but may not be specialists in financial compliance.
Training can help organisations understand their obligations.
Staff can learn how to identify suspicious transactions, maintain records, verify donors and beneficiaries and report concerns.
This reduces the risk of accidental non-compliance.
It can also make it harder for criminals to manipulate inexperienced employees.
The EFCC's risk-assessment exercise therefore provides an opportunity not only to collect information but also to educate the sector.
GOVERNANCE WITHIN NPOs
Internal governance is another important safeguard.
A well-governed organisation should have clear responsibilities.
Financial decisions should not depend entirely on one individual.
Major expenditures should be subject to appropriate approval.
Accounts should be reviewed.
Conflicts of interest should be managed.
Board members or trustees should understand their responsibilities.
These systems reduce the possibility of an organisation being secretly controlled by an individual seeking to misuse its resources.
Strong governance also improves donor confidence.
TECHNOLOGY CAN HELP
Digital financial systems can make transactions easier to trace.
Electronic payments create records that can help establish where money moved.
Digital accounting systems can help organisations maintain financial information.
Online registration systems can help regulators maintain current records.
Technology can therefore support both compliance and efficiency.
However, technology is not a complete solution.
Criminals can also use technology.
Organisations need trained personnel and appropriate controls.
Data security is another concern.
Sensitive information about donors, staff and beneficiaries must be protected.
INFORMATION SHARING
One of the key elements of effective counter-terrorism-financing work is information sharing.
Different agencies may possess different pieces of information.
One organisation may know that a particular entity operates in a community.
A bank may know about unusual financial activity.
An enforcement agency may have intelligence about a suspected criminal network.
An electoral or corporate registry may contain information about the organisation's leadership.
When legally permissible, bringing these pieces together can help authorities understand the bigger picture.
However, information sharing must also respect privacy and due-process requirements.
Authorities should not circulate sensitive information unnecessarily.
THE ROLE OF THE PUBLIC
Ordinary citizens can also contribute to financial integrity.
People who donate to charities should ask reasonable questions about the organisation.
They can check whether an organisation has identifiable leadership and a clear mission.
They can request information about how donations are used.
This does not mean donors should treat every charity as suspicious.
Rather, transparency is beneficial for everyone.
A reputable organisation should generally be comfortable explaining its mission and financial practices.
WHY TRUST MATTERS
Non-profit organisations depend heavily on public trust.
A scandal involving one organisation can affect the reputation of an entire sector.
People may become reluctant to donate.
International partners may become more cautious.
Government agencies may impose additional requirements.
Legitimate organisations can therefore suffer because of the actions of a small number of bad actors.
Strong regulation can help protect the reputation of the wider sector.
If organisations can demonstrate that their finances are transparent and their governance is sound, public confidence can increase.
THE LINK TO NATIONAL SECURITY
Terrorism financing is ultimately a national-security issue.
Nigeria has faced serious security challenges in different parts of the country.
Terrorist organisations require resources to survive.
Disrupting financial networks can therefore complement military, intelligence and policing operations.
Stopping money from reaching criminal organisations can reduce their ability to recruit, move personnel, acquire equipment and sustain operations.
Financial intelligence is consequently an important component of modern security.
The Oyo initiative forms part of that broader approach.
WHY THE SOUTH-WEST CANNOT IGNORE THE ISSUE
The South-West has generally experienced a different security environment from Nigeria's North-East and parts of the North-West.
However, that does not mean the region is immune from organised crime or financial abuse.
Large urban centres such as Ibadan and Lagos contain extensive financial networks.
The region also has international connections through airports, seaports, businesses and diaspora communities.
Criminal networks can exploit legitimate economic activity in any part of the country.
The South-West therefore has a reason to strengthen financial safeguards before vulnerabilities become larger problems.
THE BALANCE BETWEEN SECURITY AND CIVIL SOCIETY
The central challenge is achieving balance.
The government needs to prevent terrorist financing.
Civil-society organisations need enough freedom to provide humanitarian assistance.
Donors need confidence that their money will reach legitimate beneficiaries.
Banks need clear compliance standards.
Regulators need accurate information.
Law-enforcement agencies need access to relevant intelligence.
None of these objectives should automatically cancel out the others.
A balanced regulatory framework can protect them simultaneously.
WHAT OYO STATE WOULD NEED TO DO
If Oyo State accepts the EFCC's recommendation, several steps would be required.
First, the state would need to develop appropriate legislation.
Second, it would need to establish or designate an agency responsible for registration and oversight.
Third, clear registration requirements would need to be developed.
Fourth, reporting and compliance standards would need to be established.
Fifth, mechanisms for information sharing with federal agencies would need to be created.
Sixth, staff would need training.
Seventh, organisations would need public guidance about the new requirements.
The process would need to involve consultations with the NPO sector.
WHAT NPOs SHOULD EXPECT
Non-profit organisations should not interpret the latest EFCC recommendation simply as a threat.
The exercise could provide an opportunity to strengthen their internal systems.
Organisations can begin by reviewing their financial controls.
They can verify donor information.
They can improve record-keeping.
They can ensure that board and trustee responsibilities are clearly defined.
They can establish procedures for approving payments.
They can train employees.
They can review their relationships with partners and beneficiaries.
Such measures can improve organisational resilience regardless of whether a new state law is eventually enacted.
WHAT HAPPENS NEXT
The findings from the South-West risk-assessment exercise will contribute to Nigeria's broader national terrorism-financing risk assessment.
The information gathered from Oyo and other locations can help authorities understand where vulnerabilities exist.
The EFCC's recommendation to Oyo State will also require consideration by the state government.
Any proposed legislation would need to pass through the appropriate lawmaking process.
Stakeholders in the NPO sector are likely to be important participants in that process.
The eventual objective should be a framework that improves transparency without creating unnecessary barriers to legitimate humanitarian work.
WHY THE SEPTEMBER ASSESSMENT MATTERS
The current assessment is important because risks evolve.
A system that was considered relatively safe several years ago may face new vulnerabilities as technology, financial systems and criminal methods change.
Digital payments have expanded.
Online fundraising has grown.
International transfers have become easier.
Social-media campaigns can raise money quickly.
These developments provide enormous benefits to legitimate organisations.
They can also create new opportunities for abuse.
Periodic risk assessments allow authorities to update their understanding.
That is why the current national assessment is significant.
A NEW APPROACH TO FINANCIAL SECURITY
The focus on NPOs reflects a broader shift in how governments approach national security.
Security is no longer limited to soldiers, police officers and physical borders.
Money is also a security issue.
The ability to identify suspicious financial flows can help prevent crimes before they become violent incidents.
Financial intelligence can reveal networks that may otherwise remain hidden.
This is why institutions such as the EFCC and SCUML have an important role in national security.
CONCLUSION
The EFCC's call for Oyo State to establish a stronger legal framework for registering, monitoring and supervising non-profit organisations marks a significant development in Nigeria's continuing effort to prevent terrorism financing.
The recommendation emerged from a South-West component of the 2026 National Terrorism Financing Risk Assessment for the non-profit sector, which began in Ibadan on September 1.
The exercise is examining vulnerabilities within the sector and seeking ways to prevent legitimate organisations from being exploited by criminal networks.
The EFCC has made an important distinction: the assessment is not intended to portray non-profit organisations as sources of terrorism financing.
Non-profits perform valuable work across Nigeria.
They provide humanitarian assistance, support vulnerable communities, contribute to healthcare and education and help respond to emergencies.
Their work depends on donations and other forms of funding.
That financial activity is legitimate and necessary.
The concern is that criminals could potentially attempt to exploit legitimate financial channels if safeguards are weak.
The proposed Oyo law would therefore provide a framework for identifying organisations, understanding their activities and establishing appropriate monitoring mechanisms.
Registration could help authorities maintain reliable information about the organisations operating within the state.
Monitoring could help identify unusual patterns.
Clear reporting requirements could improve transparency.
Information sharing could allow state and federal agencies to respond more effectively to genuine risks.
But the success of such a framework will depend heavily on how it is designed.
Over-regulation could create unnecessary burdens for small organisations and potentially disrupt legitimate humanitarian work.
Under-regulation could leave vulnerabilities unaddressed.
The challenge is therefore to develop a proportionate, risk-based system.
Organisations operating in higher-risk environments or handling complex financial flows may require greater scrutiny.
Smaller and lower-risk organisations should not necessarily face the same administrative burden.
Clear rules and effective guidance will be important.
Non-profit organisations also have responsibilities.
They can strengthen their own defences by maintaining accurate financial records, verifying donors and beneficiaries, establishing internal controls, ensuring proper governance and training staff to recognise financial risks.
Transparency protects both the organisations and the communities they serve.
Banks and other financial institutions also have a role in identifying unusual transactions and working with legitimate organisations to meet compliance requirements.
The public can contribute by supporting transparent organisations and asking reasonable questions about how donations are used.
Ultimately, the objective is not to restrict charity.
It is to protect charity from abuse.
A terrorist network should not be able to hide behind the name of a humanitarian organisation.
At the same time, a genuine humanitarian organisation should not be treated as a criminal simply because it receives donations or operates in a difficult environment.
That balance is central to the current risk assessment.
For Oyo State, the EFCC's recommendation creates an opportunity to establish a clearer regulatory environment for the non-profit sector.
If properly designed, such a framework could improve transparency, strengthen public confidence and help protect organisations from being exploited by criminal actors.
It could also give government agencies better information about the organisations operating within the state.
The broader significance extends beyond Oyo.
Terrorism financing is a national issue.
Financial networks can cross state and international boundaries.
An organisation may operate in one state, receive money from another country and distribute resources somewhere else.
Effective oversight therefore requires cooperation between state governments, federal agencies, financial institutions, civil-society organisations and international partners.
Nigeria's existing federal laws already provide a foundation for combating money laundering and terrorism financing, while SCUML maintains regulations and supervisory mechanisms.
The challenge is making those systems work effectively at the local level.
The Oyo assessment is therefore more than a meeting about paperwork.
It is part of a broader effort to understand how financial crime can operate through legitimate economic and social structures.
The findings could influence future regulation.
For non-profit organisations, the best response is not panic but preparation.
Organisations that maintain clear records, transparent governance and accountable financial systems are better positioned to demonstrate the legitimacy of their activities.
For the Oyo State Government, the challenge is to develop any new legal framework through consultation, proportionality and respect for the important role played by civil society.
And for the EFCC and other security agencies, the challenge is to ensure that counter-terrorism-financing measures remain focused on genuine risks rather than creating unnecessary obstacles for legitimate humanitarian work.
The central message from the current assessment is therefore straightforward: Nigeria wants to make it harder for terrorist networks to exploit legitimate financial and humanitarian structures, while protecting the organisations that genuinely serve the public.
Oyo State now has an opportunity to strengthen its regulatory framework and become part of that national effort.
How effectively the state, regulators and the non-profit sector work together will determine whether the new approach improves transparency without weakening the humanitarian work on which many communities depend.