Nigeria’s financial regulations, really, need a re-visit to ensure strict enforcement and compliance. And there is no better time to do that than now. A re-visit of the country’s extant laws, as they concern the financial sector,
becomes necessary now in view of the dubious and criminal exploitation of the inherent weaknesses in the current
regulations.
The infractions, which necessitated the recent sanctions slammed on four banks, namely Standard Chartered Bank, Stanbic-IBTC, Citibank, and Diamond Bank, by the Central Bank of Nigeria, are pointers to some of the exploitation of the inherent weaknesses in our financial regulations.
The apex bank recently slammed the four banks a whopping N5.87 billion fine and asked that they, alongside leading telecommunication company, MTN Nigeria Communications Limited, refund, without any delay, the sum of $8,134,312,397.63, illegally repatriated by the company to the coffers of CBN
The apex bank recently slammed the four banks a whopping N5.87 billion fine and asked that they, alongside leading telecommunication company, MTN Nigeria Communications Limited, refund, without any delay, the sum of $8,134,312,397.63, illegally repatriated by the company to the coffers of
CBN.
Describing their offence as a ‘flagrant violation of extant laws and regulations of the Federal Republic of Nigeria, including the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act, 1995 of the Federal Republic of Nigeria and the Foreign Exchange Manual, 2006,” the apex bank, through its Corporate Communications Director, Isaac Okoroafor, justified the sanctions, saying CBN decided to wield the big stick following its investigations of the financial infractions committed by the erring banks.
Specifically, the four banks were accused of aiding and abetting illegality and fraudulent
transactions by remitting foreign exchange in various
sums, amounting to a whopping $8.1bn with irregular Certificates of Capital Importation issued on behalf of some MTN’s offshore investors between 2007 and 2015. There is no doubt that the money
involved is big as it runs into trillions of Naira if converted to local currency.This is money that would have been spent for national development
projects.
We are really sad and worried that the banks would aid and abet the telecommunication giant in illegal conversion of shareholders’ loan to preference shares and the subsequent issuance of CCIs to facilitate and justify the repatriation of the huge amount of money from Nigeria.
This, we believe, is nothing more
than an organised and sophisticated crime against the country as we wonder what the Economic and Financial Crimes Commission as well as other anti-fraud agencies were doing when these high-wired transactions were being perfected.
The Point therefore condemns the fraudulent transactions of the banks as their actions are not just a big fraud but also an economic sabotage against the country, considering the amount of money involved, more so, in hard
currency.
For MTN, we are sure its home government would not treat such action by a foreign entity with kid
gloves.
We, however, commend the apex bank, CBN, for its vigilance in discovering the infractions that assisted the huge capital flight of a whopping $8.1bn from Nigeria, illegally, at a time Nigeria is looking for foreign loan to fund its national budget. It is really annoying and worrisome that some banks would also connive with a foreign entity, such as MTN, in bleeding the country dry, especially at a time Nigeria is going through a great economic
crisis.
We therefore call for a re-visit of the country’s financial regulations and extant laws with a view to blocking all loopholes that might be exploited to move funds out of the country illegally. We also call on the Federal Government to further empower all the anti-graft agencies and economic
intelligence agencies adequately to be able to do their jobs effectively.
This would ensure that
the country’s financial laws and regulations are not only obeyed and complied with but would also ensure that adequate punishment is meted out to erring institutions and officers for contravention
of the laws.
