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CBN under Fire for Freezing Thousands of Banks’ Accounts

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House of Representatives on Tuesday, urged Mr Godwin Emefiele, governor of Central Bank (CBN), to unfreeze five thousand accounts, allegedly frozen by the apex monetary institution.

CBN under Fire for Freezing Thousands of Banks’ Accounts

Mr. Godwin Emefiele, CBN governor

The lawmakers issued the directive, after adopting a “Motion of Urgent National Importance”, sponsored by Rep. Mark Gbillah (Benue-PDP).

In raising “Concerned about the plethora of petitions and “save our soul” (SOS) appeals from Nigerian Citizens across the country In recent times about the untold hardship and poverty they are experiencing from extended freezing of their personal, corporate and other accounts by the Central Bank of Nigeria (CBN), reports of the current unprecedented freezing of over 5000 bank accounts in Nigeria by the CBN and allegations of injustice, illegality, victimisation and prejudice by the CBN against innocent Nigerians in the freezing of their accounts.

“The burgeoning number of accounts being frozen by the CBN in Nigeria appears to be taking a huge toll on the nation’s economy and livelihood of millions of Nigerians and underscores the seeming flagrant abuse of this power by the CBN when compared to the Central Banks”, he said.

He expressed worries “about innumerable allegations from affected Nigerians that the CBN in its claim of exercising the CBN Governors powers to freeze bank accounts under Section 608 of the Banks and Other Financial Institutions Act (BOFIA) 2004, incessantly violates Nigerians the fundamental human right to a fair hearing and presumption of innocence until proven guilty as enshrined in Section 36 of the 1999 Constitution of the Federal Republic of Nigeria (as amended) when it freezes accounts arbitrarily for extended periods without the knowledge of the account holder, the provision of an opportunity for the account holder to provide an explanation or referral of the matter to section 608 as an appendix to the 2004 amendment of the BOFIA after it was omitted from the body of the act in the 2004 Laws of the Federation of Nigeria (LFN) also raises concerns about whether this section was legitimately signed into law at the time”.

He expressed concerns ” about the plethora of impending litigation against the CBN which every Nigerian constitutionally has the right to Institute but that will distract the CBN from its primary statutory functions and unnecessarily expend monumental taxpayers funds for the acquisition of legal representation by the CBN which should ordinarily have been avoided but for the Indiscretion of its employees”.

The House in adopting the Motion resolved to “Ask the CBN to within 48hrs commence a review of ALL currently frozen accounts in Nigeria and to after one week remove the freeze order on accounts frozen under the following clear violations of the provisions of the 1999 Constitution of the Federal Republic of Nigeria (as amended) and Section 608 of BOFIA 2004; a) Accounts frozen before a valid court order was obtained. b) Accounts frozen without obtaining a court order from the required court of competent jurisdiction”.

The lawmaker lamented that accounts were frozen without providing the opportunity for a fair hearing to the holders of the accounts. “Accounts were frozen but till date have not been referred to the Nigeria Police Force. National Drug Law Enforcement Agency or any other appropriate regulatory authority for investigation.

“Accounts were frozen that are unconnected to the account suspected for involvement in the commission of a crime. “Accounts remaining frozen after a court-authorized period of freeze has elapsed without obtaining a fresh order from a court of competent jurisdiction”, he stated.

He said the “Accounts frozen without documentary proof of petition or reason for suspicion of involvement in the commission of a crime”.

The House also resolved to “Mandate the House Committee on Banking and Currency to immediately invite all relevant and affected stakeholders to a public investigation of circumstances surrounding the freezing of all accounts currently frozen by the CBN in Nigeria with a view to identifying any cases of contraventions of statutory provisions by the CBN in the freezing of accounts”.

He said “Provisions of the subsisting enabling act that might require immediate amendment considering the tendency for abuse by the CBN, ambiguity of related Clause(s), contradictions with provisions of other subsisting legislation, jurisprudence or global best practice and controversy surrounding the addition of related Section of the Act after the amendment of the section on 608 as an appendix to the 2004 amendment of the BOFIA after It was omitted tom the body 01 the act In the 2004 Laws of the Federation 0! Nigeria (LFN) also raises concerns about whether this section was legitimately signed Into law at the time”.

He expressed concerns ” about the plethora of Impending litigation against the CBN which every Nigerian constitutionally has the right to Institute but that will distract the CBN from its primary statutory functions and unnecessarily expend monumental taxpayers funds for the acquisition of legal representation by the CBN why should ordinarily have been amended but for the indiscretion of Its employees.

The House resolved to be” Ask the CBN to Within 48hrs commence a review of all  currently frozen accounts in Nigeria and to after one week remove the freeze order on accounts frozen under the following clear Violations of the provisions of the 1999 Constitution of the Federal Republic of Nigeria (as amended) and Section 608 of BOFIA 2004″

The House mandated ” the House Committee on Banking and Currency to immediately invite all relevant and affected stakeholders to a public investigation of circumstances surrounding the freezing of all accounts currently frozen by the CBN in Nigeria with a view to identifying any cases of contraventions of statutory provisions by the CBN in the freezing of accounts.

“Any verifiable cases of victimization or vendetta against account holders by the CBN in the freezing of their accounts. “Provisions of the subsisting enabling act that might require immediate amendment considering the tendency for abuse by the CBN. the ambiguity of related clause(s). contradictions with provisions of other subsisting legislation. jurisprudence or global best practice and controversy surrounding the addition of related Section of the Act after the amendment of the act had been published in the Laws of the Federation of Nigeria (LFN) 2004.

“Whether appropriate sanctions will be required to be recommended against erring staff of the CBN including the Governor especially when the administration of related provisions of the act is in the Governor’s name. The Committee will be required to submit a formal report to the House in Four (4) weeks for further legislative action”.

 


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E-Financial

Lagos State Appoints MoneyMaster as Payment Partner for “Ounje Eko” Programme

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“Ounje Eko”, the food price discount initiative of the Lagos State Government, has appointed leading payment service bank, MoneyMaster Payment Service Bank Limited (MMPSB), as its collaborator in the bid to ensure ease of payments at the market.

MoneyMaster is one of the Central Bank of Nigeria-licensed Payment Service Banks (PSBs) to promote financial inclusion across Nigeria.

Under the partnership, MMPSB will apply its cutting-edge payment solution to engender easy payment and reconciliation in order to make   the experiences of Lagosians who will be getting their food supplies from the markets pleasurable. Its payment solution is also all-encompassing and ensures real time value to payment destinations.

The mobile bank was appointed as the collection and payment partner for “Ounje Eko” Food Markets programme which is a government initiative serving the five divisions of Lagos State. Consequent on this, MoneyMaster Payment Service Bank will collect payments in 57 LCDAs in the state.

The partnership gives credence to the quality of payment solutions that MoneyMaster is reputed for in its services to its growing business clientele in private and public sectors.

 


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E-Financial

CBN, EFCC Probe Banks, Firms over Alleged Forex Racketeering

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Central Bank of Nigeria (CBN), is investigating irregular foreign exchange transactions and forward contracts valued at approximately $2.4 billion.

CBN, EFCC Probe Banks, Firms over Alleged Forex Racketeering

The  inquiry follows an extensive audit by Deloitte, which scrutinized $7 billion in dollar debts accumulated under the bank’s previous leadership.

In the aftermath of the 294th Monetary Policy Committee meeting in Abuja, Yemi Cardoso, governor of CBN,  disclosed to journalists that the investigation, supported by the Economic and Financial Crimes Commission, among other security bodies, aims to clarify the legitimacy of these FX allocations identified as problematic by the audit.

“It was determined that a number of these transactions did not qualify…they were outright illegal. The law enforcement agencies are now looking into those transactions that as far as we are concerned, are not valid to be paid,” Cardoso detailed, emphasizing the unlawful nature of these forex deals.

The crux of the investigation lies in the audit findings that a significant portion of the scrutinized transactions lacked proper documentation and, in many instances, were deemed outright illegal.

However, the unfolding investigation has raised concerns within the organized private sector, with some entities contemplating legal action against commercial banks for unresolved forex bids.

Despite these tensions, Governor Cardoso reassures that the foreign exchange market remains open and transparent, inviting stakeholders to address their forex needs through the official channels.

Furthermore, Cardoso clarified the distribution of fertilizers to farmers as a one-off measure and not indicative of a shift back to direct interventions by the CBN, underscoring a commitment to strategic, regulatory governance rather than direct market involvement.

 

 

 

 

 

 

 

 


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CBN Urges Banks to Expedite Action on Recapitalisation

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Central Bank of Nigeria (CBN) has directed deposit money banks in the country to expedite action to increase their capital base from the current ₦25bn.

CBN Urges Banks to Expedite Action on Recapitalisation

Olayemi Cardoso, governor of CBN

Olayemi Cardoso, governor of CBN, stated this during the apex bank’s 294th meeting of the Monetary Policy Committee (MPC) on Tuesday in Abuja, when the MPC hiked the interest rate by 22.75% to 24.75%.

The apex bank chief said the MPC examined developments in the banking sector and expressed satisfaction that the industry remained stable. The committee, however, said to guard against risk, commercial banks in the country should accelerate their recapitalisation efforts.

Cardoso said, “The MPC also reviewed developments in the banking system and noted that the industry remains safe, sound, and stable. The committee thus called on the bank to sustain its surveillance and ensure compliance of banks with existing regulatory and macro-potential guidelines.

“The MPC also enjoined the banks to expedite actions on the recapitalisation of banks to strengthen the system against potential risks in an increasingly globalised world.”

 

 

 

 


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