Business
CBN to tackle forex infractions with serious sanctions
The Central Bank of Nigeria (CBN) has uncovered non-compliance with foreign exchange market regulations and gross abuses.
The CBN assured it would punish those responsible for these infractions and abuses in collaboration with relevant agencies in the country.
Mrs. Sidi Ali, the Acting Director of Communication of the Bank disclosed this in a statement in Abuja on Wednesday.
This was as a result of the CBN announcing some measures aimed at unifying the exchange rate and remove the rate cap on the exchange rate.
The move however by the Apex Bank, has led to a significant depreciation of the naira, a situation that also affected inflation negatively.
The Apex Bank also forwarded contract obligations above $7bn to banks and firms.
But in a statement of the CBN spokeswoman on Wednesday, she said: “in its bid to clear the backlog of outstanding foreign exchange liabilities, the apex bank has paid approximately $2bn across various sectors, including manufacturing, aviation, and petroleum.”
She further stressed, “the bank had also cleared up the entire liability of 14 banks and started settlements with foreign airlines, that the bank commissioned an independent forensic review of the process by a reputable firm as she affirmed that payment of forex backlog for qualified transactions had commenced.”
The CBN spokeswoman also affirmed; “the review of the forex transactions revealed gross abuses, it revealed grave infractions, gross abuse, and significant non-compliance with market regulations, and appropriate sanctions will be melted to the culprits accordingly.”
“The Apex Bank has therefore, resolved to sanitise the financial services sector and ensure trust among all market participants, with internal and external stakeholders, in the nation’s economy, all legitimate foreign exchange backlog would be settled by the CBN as it has been consistently doing in few months ago, said, spokeswoman.”
The bank disclosed that it had paid $2bn to clear part of its backlog of matured foreign exchange obligations to Deposit Money Banks, reports have equally put that the CBN’s forward contract obligations to banks at $7bn. It also disclosed that it paid $61.64m to foreign airlines.
“These payments signify the CBN’s ongoing efforts to settle all remaining valid forward transactions, to alleviate the current pressure on the country’s exchange rate.” Ali said.
“It is anticipated that this initiative by the CBN should provide a considerable boost to the Naira hug against other major world currencies and further increase investor confidence in the Nigeria economy.”
The Economic and Financial Crimes Commission (EFCC) had outlined some companies as part of its probe into the allegation of preferential allocation of forex. The commission asked the firms to submit Form A and Form M between 2014 and June 2023.
The he anti-graft commission however, had earlier reportedly written to 52 companies directing them to provide documents supporting the allocation and utilisation of foreign exchange sold to them at official rates in the last 10 years for proper clarification.
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