The Central Bank of Nigeria has imposed heavy fines totalling N5.87bn on four banks under its regulatory purview for alleged illegal funds repatriation.
It also directed the managements of the banks and MTN Nigeria Communications Limited to immediately refund to the apex bank $8,134,312,397.63, which was said to have been illegally repatriated by the company.
A statement from the CBN on Wednesday said it asked the banks and MTN to refund money 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’.
The four banks that came under the sledge hammer of the CBN for the violations are Standard Chartered Bank, Stanbic-IBTC, Citibank and Diamond Bank.
The Director, Corporate Communications, CBN, Isaac Okorafor, said that the actions of the bank became necessary following allegations of remittance of foreign exchange with irregular Certificates of Capital Importation issued on behalf of some offshore investors of MTN Nigeria Communications Limited and subsequent investigations carried out by the apex bank in March 2018.
“The CBN has therefore asked the managements 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,” it stated.
Figures obtained from the CBN on Wednesday indicated that the highest fine of N2.47bn was slammed on Standard Chartered Bank, while Stanbic IBTC Nigeria was fined N1.885bn.
Citibank Nigeria was penalised to the tune of N1.265bn, just as Diamond Bank was directed to pay N250m for violating extant rules.
The CBN spokesman further disclosed that the decision of the bank followed its thorough investigations into the allegations.
Okorafor said the investigations revealed that the sum of $3.448bn was repatriated by Standard Chartered Bank on the basis of the illegally issued CCIs.
Similarly, he added that the sums of $2.632bn, $1.766bn and $348.914m were repatriated by Stanbic IBTC Nigeria, Citibank Nigeria and Diamond Bank Plc, respectively between 2007 and 2015.
He said the CBN had directed the affected banks to immediately refund the respective sums to the CBN.
“The CBN’s 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,” the statement said.
He said that the investigations by the CBN took a while in order to carry out thorough inquiry and give a fair hearing to all parties involved.
Okorafor 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.