The Central Bank of Nigeria (CBN) today disclosed that it has imposed a fine of N5.87 billion on four banks under its regulatory purview.
The apex bank also directed the affected lenders, namely Standard Chartered Bank, Stanbic-IBTC, Citibank and Diamond Bank to refund the sum of $8,134,312,397.63 for what it described as ‘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’.
Giving these hints in Abuja, the apex bank’s Acting Director Corporate Communications, Isaac Okorafor, said that the actions of the regulatory banking institution became necessary following allegations of remittance of foreign exchange with irregular Certificates of Capital Importation, CCIs, issued on behalf of some offshore investors of MTN Nigeria Communications Limited and subsequent investigations carried out by the apex bank in March 2018.
According to him, the CBN, therefore, asked the management of the banks and MTN Nigeria Communications Limited to immediately refund the sum of $8,134,312,397.63, illegally repatriated by the company to the coffers of the Central Bank of Nigeria.
Available statistics on the sanctions provided by the apex bank showed that the highest fine of N2,470,604,767.13 was slammed on Standard Chartered Bank, while Stanbic IBTC Nigeria was fined the sum of N1,885,852,847.45.
Also, Citibank Nigeria was penalized in the sum of N1,265,541,562.31 while Diamond Bank was directed to pay the sum of N250 million for violating extant rules.
Okorafor explained further that investigations on the irregular certificates of Capital Importation, CCIs, issued on behalf of some offshore investors of MTN Nigeria Communications Limited reflected that the sum of $3,448,119,321.72 was repatriated by Standard Chartered Bank on the basis of the illegally issued CCIs.
He stated further that the sums of $2,632,005,623.78, $1,766,263,212.75 and $348,914,501.30 were repatriated by Stanbic IBTC Nigeria, Citibank Nigeria and Diamond Bank Plc, respectively, during the period 2007 and 2015.
Based on the findings, he said the CBN had directed the affected banks to immediately refund the respective sums to the CBN.
The CBN investigation further revealed that on account of illegal conversion of MTN shareholders’ loan to preference shares (interest-free loan) of $399,594,146.00, the sum of $8,134,312,397.63 was illegally repatriated by the company.
Noting that the investigations by the CBN took a while in order to carry out a thorough inquiry and give fair hearing to all parties involved, the apex bank’s spokesperson advised all banks and multinational companies in Nigeria to adhere strictly to the provisions of all extant laws and regulations of Nigeria in their foreign exchange transactions.
This is even as he warned that failure by the management of banks and companies to abide by the existing guidelines would be appropriately sanctioned, which sanctions may include denial of access to the Nigerian foreign exchange market.