Introduction

A recurring question in Nigerian real estate practice is whether a seller of land can lawfully accept cash payment from a buyer for the transfer of property. For decades, many Nigerians, both buyers and sellers, have treated cash as a routine medium of exchange in property deals without giving any thought to the legal consequences. What many participants in the Nigerian property market do not know is that paying or accepting cash for the purchase of landed property is a criminal offence under Nigerian law.

The statutory provision that criminalises this conduct is Section 22(1)(a) of the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act, Cap F34, LFN 2004. Does the law apply regardless of whether the cash is in Naira or in a foreign currency? What are the specific ingredients that the prosecution must establish before a court can convict a person of this offence? Does the offence operate as a strict liability, without proof of any fraudulent intent? Can a person who received the cash payment on behalf of a principal escape liability by invoking the law of agency?

In the recent case of Aliyu v. FRN (2026) LPELR-83493(SC), the Supreme Court of Nigeria had the opportunity to answer these questions and to outline, definitively, the elements that the prosecution must prove to secure a conviction under Section 22(1)(a) of the Act.

Summary of the Facts of Aliyu v. FRN

The Appellant, Mahmoud Aliyu, was arraigned before the Federal High Court, Abuja Division and charged with accepting cash payments for the sale of landed property, contrary to the provisions of Section 22(1)(a) of the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act (“the Act”). The prosecution’s case was that the Appellant received the sum of $10,000.00 (Ten Thousand U.S. Dollars) and N600,000.00 (Six hundred thousand naira) in cash as consideration for the sale of a 3-bedroom apartment in Lugbe Housing Estate, Abuja, to one Mrs Hafsat Hamza Al-Mustapha, instead of directing the buyer to remit the payment through the banking channels required by law.

In his defence, the Appellant contended that he was not guilty of the offence because he received the cash payment on behalf of his principal, one Major Sanusi N. Muazu. Although the Appellant signed a receipt acknowledging receipt of the cash payment from the buyer, he argued that, since it was his principal who signed the Deed of Assignment through which the property was transferred, it was his principal who should be convicted of the offence.

The trial court evaluated the evidence before it and found the Appellant guilty of the charge because the Appellant was unable to establish the existence of an agency relationship with Major Sanusi N. Muazu, who did not give evidence in the case. Accordingly, the trial court convicted and sentenced the Appellant to 12 months imprisonment or a fine of N1,000,000.00 (One Million Naira). The Appellant appealed to the Court of Appeal, which affirmed the conviction and held that receiving physical cash for the sale of landed property constitutes a strict liability offence under the Act. Dissatisfied with the outcome, the Appellant further appealed to the Supreme Court, contending that the prosecution had failed to establish all the ingredients of the offence beyond a reasonable doubt.

Summary of the Supreme Court’s Decision

The Supreme Court dismissed the appeal and unanimously upheld the decisions of the lower courts. In delivering the lead judgment, Ogbuinya, JSC, examined the text of Section 22(1) of the Act, which provides as follows:

“22. Payments for certain goods

(1) Notwithstanding anything to the contrary contained in any enactment or law and except as provided in Subsection (2) of this Section, no person shall, in Nigeria, make or accept cash payment, whether denominated in foreign currency or not, for the purchase or acquisition of the following:

(a) landed properties;

(b) securities, including stocks, shares, debentures and all forms of negotiable instruments; and

(c) motor cars, including other vehicles of any description whatsoever.

(2) Payments for the items specified in Subsection (1) of this Section shall, as from the commencement of this Act, be made by means of bank transfers or cheques drawn on banks in Nigeria only.”

The Supreme Court held that the inclusion of the word “notwithstanding” in Subsection (1) was deliberate, and that it operates to place the prohibition beyond the reach of any other law or contractual arrangement that could otherwise have permitted cash payments for land. The provision, by its express terms, overrides every other enactment or law to the contrary.

On the elements that the prosecution must prove to secure a conviction, Ogbuinya, JSC, at Pages 13-14 Paragraphs D-A, held as follows:

“The elements of the offence preferred against the appellant can be harvested from the provision catalogued supra. Thus, the ingredients of the offence, which the respondent has the bounden duty to establish beyond reasonable doubt, are, videlicet:

(a) The defendant must be a person, whether juristic or natural person.

(b) There must be a landed property.

(c) The landed property must have been sold for valuable consideration i.e. money.

(d) The defendant received/accepted cash payment for the sale of the landed property.”

The Supreme Court held that once all four elements are established on the facts of a transaction, the offence is fully made out. The court emphasised that the purpose of the law was to guarantee transparency in property transactions by ensuring that every payment leaves an auditable trail through the banking system. Accordingly, since the Appellant admitted receiving the cash payment from the purchaser, he was guilty of the offence and liable to conviction.

Regarding the Appellant’s contention that he ought not to be convicted because he was an agent of a disclosed principal, the Supreme Court held that the principle of agency or vicarious liability has no place in the realm of criminal law, where every accused person must answer for their own actions. Ogbuinya, JSC, at Pages 24-25 Paragraphs G-F, held as follows:

“There is a stronger knock on the defence of agency invented by the appellant to castrate the charge against him. No doubt, the doctrine of agency is propagated firmly in our corpus juris. However, while the doctrine thrives and flourishes in the expansive hemisphere of civil law in deserving circumstances, it is deprived of any atom of shelter in the large landscape of criminal jurisprudence. In the territory of criminal law, criminal liability, which germinates from a combination of proved actus reus and mens rea, is personal to a particeps criminis. There is no transfer or alienation of criminal responsibility even in the presence of a proved agency relationship as an agent or a principal is compelled by law to bear his cross in the pitfall of criminality. Indeed, concept of vicarious liability is a stranger to the wide province of criminology; see APC v. PDP (2015)  4 SCM 48; PML (Nig.) Ltd v. FRN (2017) LPELR- 43480 (SC). Indubitably, the defence of agency, which the appellant manufactured, paraded and brandished to perforate and demolish the proof of the charge against him, flies in the face of the law and galore of evidence on record as dissected supra. It is a moonshine defence that cannot fly!”

Key Takeaways from the Supreme Court’s Decision

1. The four ingredients of the offence under Section 22(1)(a) of the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act: Before an offence under the Act can be established, the prosecution must prove that: (i) the defendant is a natural or juristic person; (ii) the subject matter of the transaction is landed property; (iii) the property was sold for monetary consideration; and (iv) the defendant accepted or received physical cash as payment. All four elements must be established beyond a reasonable doubt.
2. The prohibition is absolute regardless of the currency: The law expressly states that it does not matter whether the cash payment is denominated in Naira, United States Dollars, Euros, or any other foreign currency. The moment physical cash changes hands for the purchase of land, the offence is committed.
3. The “notwithstanding” clause removes any competing defence: Because Section 22(1) opens with the word “notwithstanding,” a seller cannot argue that another law, a contractual term, or an industry custom permitted them to accept cash payment for the purchase of a property. The prohibition stands on its own and cannot be watered down by any other provision.
4. Only payment channels that settle through Nigerian banks are lawful: Section 22(2) of the Act recognises only bank transfers and cheques drawn on Nigerian banks as valid methods of payment for landed property. Modern payment channels such as NIBSS instant transfers, USSD payments, and electronic wallets are acceptable to the extent that they ultimately settle through a licensed Nigerian bank and produce a bank-issued record of the transaction. Any payment route that does not produce such a record carries risk.
5. Both buyers and sellers are exposed to criminal liability: The law prohibits both the making and the acceptance of cash payments. A buyer who hands over cash and a seller who receives it are both potentially liable under the Act. The buyer was not charged in this case, but this is best understood as a matter of prosecutorial discretion rather than an exemption. A buyer should never assume that the prosecution’s silence regarding one party offers any protection to the other.
6. Corporate entities are not shielded from prosecution: The offence covers juristic persons, meaning that a real estate company, a property developer, or any incorporated entity that accepts cash for the sale of land is equally susceptible to prosecution alongside its directors or officers.
7. Conveyancing documents must reflect lawful payment channels: Legal Practitioners who draft deeds of assignment or sale agreements should ensure that the acknowledgement of receipt of purchase price expressly references the bank transfer details or cheque particulars used for payment. Describing the consideration as having been received in cash in a legal instrument, such as a purchase receipt or recital, is tantamount to producing written evidence of a statutory violation.
8. The existence of an agency relationship will not protect an agent or developer from conviction: While it is not unusual for Estate Agents to receive the purchase price for the sale of their clients’ properties from buyers, they must be aware that they would be held personally liable for committing an offence under the law if they receive any payments in cash. Their best protection is to insist that buyers remit funds directly to the principal’s bank account, or to a bank account designated for the transaction.

Comments on the Relevance of Section 2 of the Money Laundering (Prevention and Prohibition) Act 2022

Section 2 (1) of the Money Laundering (Prevention and Prohibition) Act 2022 provides that no individual shall make or accept a cash payment of a sum exceeding N5,000,000.00 (Five Million Naira) or its equivalent, and no corporate entity shall make or accept a cash payment of a sum exceeding N10,000,000.00 (Ten Million Naira) or its equivalent.

However, it should be noted that this provision of the Money Laundering (Prevention and Prohibition) Act 2022 will not act as a valid defence for anyone who pays less than N5,000,000.00 (Five Million Naira) in cash as the consideration for landed property. The Money Laundering Act provision is threshold-driven and applies to any subject matter, while section 22(1)(a) of the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act, Cap F34, LFN 2004 is subject-matter driven and applies to land regardless of quantum. Accordingly, falling outside the Money Laundering Act threshold does not, therefore, take a transaction outside the  Foreign Exchange (Monitoring and Miscellaneous Provisions) Act.

Conclusion

The Supreme Court’s decision in Aliyu v. FRN (2026) LPELR-83493(SC) makes it clear that the physical exchange of cash for landed property is a criminal offence in Nigeria, regardless of whether the buyer or seller acted in good faith, and regardless of the currency in which the cash was denominated. The decision also clarifies the four prosecutorial ingredients that must be established beyond a reasonable doubt before a conviction will stand, and reinforces that the offence is, in substance, one of strict liability that admits of no defence based on agency, mistake, or commercial custom.

Going forward, real estate practitioners, property developers, individual investors, and their legal advisers must treat bank transfers and bank-issued cheques as the only safe payment methods for any property transaction. Anything less does not merely expose the parties to regulatory sanction, but it also transforms a routine property purchase into a criminal trial.

Please note that this article is for general information only. We do not offer it as advice on any particular matter, whether legal, procedural or otherwise. If you have questions about this article, please contact:

Faruq Abbas (Managing Partner): foa@abdu-salaamabbasandco.com.

Fawaz Salman (Associate): f.salman@abdu-salaamabbasandco.com.

 

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