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CBN Sanction: A Dis-Incentive To Capital Investment

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By Cheku Alkali

A fundamental objective of financial regulation is the safety and soundness of financial institutions, and the ability of regulators to mitigate systemic risk through effective policy/reforms.

This assertion represents the statutory mandate of the Central Bank of Nigeria (CBN) under the Central Bank of Nigeria Act, 2007; the Banks and Other Financial Institutions Act (BOFIA); and the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act 1995 and other subsidiary legislations.

Admittedly, financial systems cannot function effectively without confidence in the markets. However, due to the volatile nature of the financial market, regulatory actions or inactions may cause disruption to the financial system; thereby reducing confidence in the ability of markets to function effectively.

This in turn could impair the availability of credit and overall economic activities in the country. It is against this background and the overarching responsibility of the CBN to ensure soundness of the financial system (whilst encouraging foreign capital investment) that this writer examines the impact of CBN’s sanction on MTN Nigeria Communications Limited (MTN).

The Central Bank of Nigeria on Wednesday, August 29, 2018, directed MTN to refund the sum of $8.13 billion for alleged illegal conversion of shareholders’ loans to preference shares; and the repatriation of same out of Nigeria.

Other affected parties are four Banks namely – Citibank, Diamond Bank, Stanbic IBTC and Standard Chartered Bank (the Banks)- all directed to refund the sum of NGN2.5 billion for allegations of illegal remittances of foreign exchange with irregular certificates of capital importation (CCIs) issued on behalf of some offshore investors of MTN between 2007 – 2015.

CBN’s investigation was primarily on three key “infractions” to wit; issuance of Certificates of Capital Importation (CCI’s) for the following items; foreign currency sourced locally; falsely declared capital importation; and interest-free loans converted to preference shares without authorization.

In response, MTN described the allegation as regrettable, and reiterated its intention to vigorously defend its position before a court of competent jurisdiction.

At the time of going to print, we understand MTN has instituted an action in this regard at the Federal High Court of Nigeria.

CCI is a certificate issued by an authorized dealer (usually a licensed commercial bank) confirming an inflow of foreign capital either in form of cash (loan or equity) or goods.

CCI is usually issued in the name of the investor with 24-48 hours of the inflow of the capital into Nigeria.

Its primary purpose is to guarantee access to the foreign exchange market for the repatriation of capital/returns on investment – dividend, interest and capital on divestments, as well as repayment of principal and interest accruing on a foreign loan.

Assuming to be correct, the allegation against MTN and the Banks, the question which arises is whether the CBN has effectively discharged its responsibility of financial supervision given the length of time (8 years) it took to realise, investigate and sanction the affected parties.

As stated, foreign investors are permitted to import capital or invest in any enterprise in foreign currency, through authorized dealers – who are permitted to issue CCIs within 24 (sometimes 48) hours of receiving the capital inflow.

It may then be argued, that the inability of the CBN to effectively and promptly monitor the inflow and outflow of foreign capital, is effectively a failure to discharge its statutory obligation.

Put differently, the CBN should have sanctioned the affected entities long ago to avoid the disruption now caused because of the delay in this regard. An unintended effect of this regulatory lapse may be the resultant lack of confidence and transparency in the financial market, that tends to stifle foreign investment activities.

The CBN Manual 2006 (the operating manual at the time the actions of the above-named entities were carried out) provides that foreign investors are guaranteed unconditional transfer of their capital, profits and dividends attributable to their investments in any convertible currency through authorized dealers.

This means that a company/investor intending to repatriate its capital will be required to provide a CCI as evidence that the original investment was imported into Nigeria.

Following the CBN sanction, MTN has witnessed a drop in its share price by 23%. Even in the event the allegations are false and MTN succeeds in its claim against the CBN, the reputational damage to the nation may be irreversible.

For the savvy investor desirous of repatriating capital returns, economic headwinds would seem to warn against bringing in capital investment. Investors would find it easy to conclude that bringing in funds would be unwise because of a perceived inability to access and repatriate same when required.

Thus, by failing to proactively supervise the instant issue, the CBN; despite acting within its statutory powers, may occasion a ripple effect on investor’s confidence in Nigeria’s financial system.

Looking forward, instead of taking similar (delayed) reactionary measures, this writer suggests that the CBN should look to strengthen its monitoring, and processing of CCIs of foreign investment flows in and out of the country.

To achieve this, it can adopt a twin approach to its supervisory role to ensure transparency, market integrity, and consumer protection. This approach of coupling the power of sanction with proactive regulation, will also ensure that the CBN acts as a catalyst for foreign direct/portfolio investment as opposed to becoming an inadvertent market disruptor. It will better reinforce the CBN’s commitment towards ensuring a transparent and stable financial system.

A regulator such as the CBN must always weigh the outcome of its actions or inactions on the market before taking any step. Although it is difficult to have near perfect supervision, it is possible to implement stronger financial supervision measures to reduce the chances of putting foreign capital investment to flight.

Financial regulation in this regard can serve as not just a means of maintaining stability, but as an instrument for growth and development of the financial system.

 Cheku Alkali is an Associate of Perchstone and Graeys


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IEEE CTU-EMEA Summit Organizers Hold Strategic Meeting with Baze University Management

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The Local Organising Committee of the IEEE Connecting the Unconnected Europe, Middle East, and Africa (CTU-EMEA) Summit 2025 on Wednesday paid a courtesy visit to the management of Baze University, Abuja, in preparation for the international conference scheduled to hold from Nov. 27 to 28.

The visit, which brought together top officials from IEEE Nigeria Section and senior management of Baze University, focused on finalising arrangements for the summit themed “Bridging Digital Frontiers: African Solutions for Universal Connectivity.”

Speaking during the meeting, Mr. Chukwuemeka Gerald Okafor, General Conference Chair, described the summit as a historic milestone for Nigeria’s digital transformation agenda.

“This is the first time Nigeria is hosting an IEEE CTU international summit of this magnitude. Over 200 global leaders—ministers, regulators, CEOs, and innovators—will converge in Abuja to address the challenge of connecting 2.9 billion unconnected people worldwide,” Okafor said.

He disclosed that high-profile speakers had confirmed participation, including government ministers, representatives of the World Bank and International Telecommunication Union (ITU), telecom executives, and researchers from across the EMEA region.

Also speaking, Prof. Osita, Deputy Vice Chancellor (Academics), who represented the Vice Chancellor of Baze University, expressed the institution’s readiness to host the summit.

“We are honoured that IEEE selected Baze University as the venue for this prestigious event. It aligns with our vision of becoming a hub for technology innovation and global academic collaboration,” Osita said.

The summit programme includes an opening ceremony with ministerial presence, eight technical tracks, panel discussions, paper presentations, workshops, and an exhibition area for technology companies and startups.

Social events such as a Welcome Cocktail on Nov. 26 and a Gala Dinner on Nov. 28 are also planned to foster networking and collaboration.

Ms. Nneoma Offodile, Chair of the Local Organising Committee, said the summit would leave a lasting legacy for Nigerian students, especially those at Baze University.

“There will be volunteer opportunities, discounted registration, and exposure to global experts. We want students to benefit directly from this gathering,” she said.

The meeting also addressed logistical arrangements including venue setup, technology infrastructure, catering, accommodation, and security for international delegates.

IEEE, founded in 1884, is the world’s largest technical professional organisation with over 423,000 members globally. Its CTU programme focuses on bridging the digital divide through research, innovation, and stakeholder engagement.

Engr. Abdulateef Aliyu, IEEE Region 8 Representative, said the summit affirms Nigeria’s capacity to host world-class events and positions the country as a strategic hub for technology discourse in Africa.

The organising committee called on Nigerian ICT professionals, telecom operators, corporate sponsors, researchers, and students to participate actively in the summit.

Prof. Ifeayinwa Achumba, IEEE Nigeria Section Chair, said the summit would showcase scalable African solutions to global connectivity challenges.

Follow-up meetings are scheduled to finalise technical details and coordinate logistics ahead of the November event.


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65m Nigerians Pushed into Poverty as GDP Per Capita Falls 66% – Report

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Over 65 million Nigerians were reportedly pushed into poverty in 2024 following a 66 per cent decline in the country’s gross domestic product (GDP) per capita, according to a new report by Quartus Economics.

The report, titled “Forty Years of Structural Adjustment: Is Africa’s Eagle Stuck or Soaring Back to Life?”, examined Nigeria’s economic trajectory since the introduction of the Structural Adjustment Programme (SAP) in 1986.

Quartus noted that while the reforms helped grow Nigeria’s GDP from $87.5 billion in 1990 to $252 billion in 2024, the country’s economic structure remained fragile, with the naira losing 99.7 per cent of its value over the same period.

The report stated that liberalisation, privatisation, and banking reforms initially boosted private investment and manufacturing, but policy reversals and weak implementation undermined progress.

“Policy inconsistencies and weak implementation led to a recurring cycle of mixed results and missed opportunities,” the report said. “The goal of inclusive, export-led growth has remained elusive.”

Between 2014 and 2023, Nigeria experienced its worst growth slowdown in a generation, driven by falling oil prices, population pressures, restrictive fiscal and monetary policies, and governance lapses. Inflation rose above 30 per cent, capital inflows declined, and economic stagnation persisted.

However, the report praised the 2023–2024 reforms, including the removal of petrol and foreign exchange subsidies, as decisive measures that began correcting structural distortions.

By late 2024, GDP growth rebounded to nearly 4 per cent, with renewed strength in the manufacturing and mining sectors. Foreign reserves rose to $42 billion by October 2025, and inflation began to ease slightly.

Despite these improvements, Quartus warned that per capita income remains far below pre-crisis levels and that Nigeria’s export base and governance systems still face deep inefficiencies.

“The recovery is real, but lasting transformation will depend on discipline, continuity, and collective commitment to reform,” the report concluded.


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BlueNoroff Targets Eecutives on Windows and MacOS Using AI-driven Tools

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At the Security Analyst Summit in Thailand, Kaspersky’s Global Research and Analysis Team (GReAT) unveiled the latest BlueNoroff APT activity through two highly targeted malicious campaigns ‘GhostCall’ and ‘GhostHire’. The ongoing operations have been targeting Web3 and cryptocurrency organisations across India, Turkiye, Australia and other countries in Europe and Asia since at least April 2025.

BlueNoroff, a subdivision of the notorious Lazarus group, continues to expand its signature ‘SnatchCrypto’ campaign, a financially motivated operation which targets crypto industries worldwide. The newly described GhostCall and GhostHire campaigns employ new infiltration techniques and customised malware to compromise blockchain developers and executives. These attacks affect macOS and Windows systems as primary targets and are managed through a unified command-and-control infrastructure.

The GhostCall campaign focuses on macOS devices, beginning with a highly sophisticated and personalised social engineering attack. The attackers reach out via Telegram, impersonating venture capitalists and in some cases using compromised accounts of real entrepreneurs and startup founders to promote investment or partnership opportunities. The victims are invited to fake investment meetings on phishing sites mimicking Zoom or Microsoft Teams during which they are prompted to “update” their client to fix an audio issue, this action downloads a malicious script and deploys a malware infection on the device.

“This campaign relied on deliberate and carefully planned deception. Attackers replayed videos of previous victims during staged meetings to make the interaction appear like a real call and manipulate new targets. The data collected in this process is then used not only against the initial victim but also exploited to enable subsequent and supply-chain attacks, leveraging established trust relationships to compromise a broader range of organisations and users,” comments Sojun Ryu, security researcher at Kaspersky GReAT.

Attackers deployed seven multi-stage execution chains, four which were previously unseen, to distribute a range of new customised payloads, including crypto stealers, browser credential stealers, secrets stealer, and Telegram credential stealers.

In the GhostHire campaign the APT targets blockchain developers by posing as recruiters. Victims are tricked into downloading and running a GitHub repository containing malware, presented as a skill assessment. GhostHire shares its infrastructure and tools with the GhostCall campaign, but instead of using video calls, it focuses on approaching hands-on developers and engineers through fake recruitment. After initial contact, victims are added to a Telegram bot that delivers either a ZIP file or a GitHub link, along with a short deadline to complete the task. Once executed, the malware installs itself on the victim’s machine, customised for the operating system.

The use of generative AI has enabled BlueNoroff to accelerate malware development and refine its attack techniques. The attackers introduced new programming languages and added additional features, complicating detection and analysis tasks. It further enables the actor to manage and expand its operations, increasing both the complexity and scale of attacks.

“Since its previous campaigns, the threat actor’s targeting strategy has evolved beyond simple cryptocurrency and browser credential theft. The use of generative AI has significantly accelerated this process, enabling easier malware development with reduced operational overhead.

“This AI-driven approach helps to fill the gaps in available information, enabling more focused targeting. By combining compromised data with AI’s analytical capabilities, the scope of these attacks has expanded. We hope our research will contribute to preventing further harm,” comments Omar Amin, senior security researcher at Kaspersky GReAT.

 


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