The governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, has announced that law enforcement agencies, including the Economic and financial crimes commission (EFCC), are investigating $2.4 billion unverified foreign exchange (FX) claims.
Mr. Cardoso made the announcement during a press conference on Tuesday, March 26th, 2024, after the conclusion of the 294th meeting of the monetary policy committee (MPC) in Abuja. The apex bank, according to the governor, is assisting in the investigation by providing all necessary documents to aid the security agencies.
Mr. Cardoso had revealed, at the dawn of his reign, that he inherited a $7 billion FX backlog when he became the head of the apex bank in September 2023, however, it was discovered that $2.4 billion of the sum was invalid following preliminary inquiry into the transactions.
Recently, the CBN revealed that all outstanding, “legitimate” FX obligations had been settled but some players in the industry disputed the claims prompting th CBN to provide clarity on the unverified claims, the CBN governor highlighted various irregularities, such as the disbursement of large sums of FX for requests that were never submitted and allocations made without the necessary naira backing.
He said there was an absence of legal validity and adequate documentation in these transactions.
Cardoso also stressed the gravity of these irregularities, labelling numerous transactions under investigation as “clearly unlawful”.
“We brought in Deloitte management consultants who took time and this really did take months. This is not something that happened overnight and a lot of this work was going on and people didn’t know but they took months painstakingly to go through all the documents, all the documents and to ensure that you know, they would have a report, which we could rely on,” Cardoso said.
“In the course of that, of course, we determined that a number of these transactions did not qualify. In some cases, you had some allocations that were made in millions of dollars, which were never requested for.
“We also had somewhere they had no naira and they were also allocated, you know, huge sums of foreign exchange and the list goes on. It was for that reason that we refused to validate those particular transactions.
“We refused to validate them because apart from the fact that documentation was not satisfactory, in many cases, they were outright illegal. And the law enforcement agencies, of course, are now looking into those transactions that are, as far as we’re concerned, not valid to be paid.
“I would emphasize that if there’s any information to the contrary, we would in due course consider that but as of today, that is exactly where it stands and the law enforcement agencies are taking a very, very hard look at those transactions.
“Other transactions, we have settled and as of today, as I have said before, I will say it again, that the valid transactions as far as the Central Bank of Nigeria is concerned, have been taken care of.”
