The Economic and Financial Crimes Commission's (EFCC) decision to freeze the Osun State Government's statutory allocation account has sparked a legal and political storm, with the Nigerian Bar Association (NBA), several Senior Advocates of Nigeria (SANs) and the Accord Party questioning the legality and timing of the action ahead of the August 15 governorship election.
The anti-graft agency had directed First Bank to place a Post No Debit restriction on the state's statutory allocation account as part of an investigation into the alleged diversion of about N11 billion in Ecology Funds, Intervention Funds and Federal Account Allocation Committee (FAAC) allocations.
The directive was contained in a letter dated August 5, 2026, signed by Assistant Commander of the EFCC, Adenike Babalola, on behalf of the Director of Investigation. The letter instructed the bank to halt withdrawals from the account pending the conclusion of investigations.
Defending the action, the EFCC said the restriction became necessary after investigators detected what it described as suspicious movements of funds from the account beginning August 2.
In a statement by its Head of Media and Publicity, Dele Oyewale, the commission said investigations into the finances of the Osun State Government commenced in March 2026 and had already involved the interrogation of key government officials, including the state's Accountant-General.
According to the commission, investigators observed large transfers from the account to several corporate entities, prompting immediate intervention to prevent further movement of funds.
The agency maintained that the ongoing governorship election did not exempt any state from investigation, insisting that it was duty-bound to safeguard public funds.
"The Commission is fully aware of the forthcoming governorship election in Osun State, but it cannot abandon its statutory responsibility because of political considerations," the statement said, dismissing allegations that the action was politically motivated.
It added that several other states were also under investigation and urged Nigerians not to read political meanings into its operations.
However, the NBA President, Afam Osigwe (SAN), criticised the development, arguing that the EFCC lacked the authority to impose a blanket restriction on a state's finances without judicial approval.
He said while the commission could seek court orders against specific accounts linked to suspected criminal activities, freezing the accounts of an entire state government would effectively shut down governance and exceed the agency's constitutional powers.
"No government agency has the right to cripple the operations of a state government by freezing its accounts without following due legal process," Osigwe said.
He insisted that any attempt to freeze the account of a government institution or individual must be backed by a valid court order and advised financial institutions not to comply with directives that lacked judicial authorisation.
Other senior lawyers also expressed concerns over the legality of the action.
Adeyinka Olumide-Fusika (SAN) said Nigerian courts had consistently ruled that anti-graft agencies could not freeze bank accounts without first obtaining court approval.
According to him, although the EFCC regularly imposed restrictions on private accounts, extending such action to a state government raised constitutional questions.
Isiaka Olagunju (SAN) described the restriction as inconsistent with the 1999 Constitution and the principles of federalism, arguing that investigations into alleged financial misconduct should target specific officials rather than denying an entire state government access to public funds.
Chief Mike Ahamba (SAN) also questioned the legal basis for the action, saying he was unaware of any provision of law authorising the EFCC or the Federal Government to freeze the account of a state government.
Offering a different interpretation, Professor Damilola Olawuyi (SAN) said temporary account restrictions were recognised globally as legitimate tools for preventing financial crimes.
He, however, stressed that such powers must be exercised strictly within the law and should never be deployed for political purposes or as substitutes for thorough investigations.
Another senior lawyer, Wolemi Esan (SAN), explained that the Money Laundering (Prevention and Prohibition) Act empowers the EFCC to issue a temporary stop order on suspicious accounts for up to 72 hours without a court order.
He added that any restriction beyond that period must be supported by an interim freezing order issued by a competent court under the EFCC Act.
The controversy also attracted reactions from civil society groups.
Executive Director of the Civil Society Legislative Advocacy Centre (CISLAC), Auwal Musa Rafsanjani, urged the Osun State Government to challenge the restriction in court if it believed the EFCC acted outside the law.
Meanwhile, the Accord Party accused the anti-graft agency of attempting to influence the outcome of the forthcoming governorship election.
In a statement issued by its National Chairman, Chief Maxwell Mgbudem, the party alleged that the freezing of the state's accounts formed part of a coordinated effort by federal institutions to weaken the Osun State Government ahead of the poll.
He described the EFCC's action as unconstitutional and maintained that the commission ought to have obtained a court order before restricting access to the account.
Mgbudem announced that the party would challenge the action in court and urged President Bola Tinubu to ensure neutrality by security agencies and other federal institutions throughout the electoral process.
He further accused the police of harassing and detaining some Accord members and supporters in Osun, Abuja and Nasarawa states and demanded their immediate release.
The party also called on the Independent National Electoral Commission (INEC) to conduct a free, fair and credible election, warning that any attempt to undermine the democratic process would be resisted through lawful means.
The EFCC's action has therefore intensified debate over the balance between anti-corruption enforcement and constitutional safeguards, with legal experts divided over the scope of the commission's powers and political actors questioning the timing of the intervention just days before Osun voters head to the polls.
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