Emefiele querried over alleged Forex fraud, cabals in CBN

Ade Adesomoju, Abuja

The Attorney General of the Federation and Minister of Justice, Mr. Abubakar Malami (SAN), has said there are corruption allegations in the Central Bank of Nigeria’s foreign exchange allocation and transactions.

Malami added, on Wednesday, the fraud allegations were “supported by several documents.”

The PUNCH sighted a subtle query issued by Malami to the Governor of CBN, Mr. Godwin Emefiele, demanding “prompt response” to the allegations.

Malami’s letter, dated February 6, 2017, and with reference number, HAGF/CBN/2017/VOL.1/1, was sighted with an official, close to the legal unit of the apex bank.

The letter, in polite terms and without giving any ultimatum, asked Emefiele to respond to the allegations “to enable us to advise the Presidency and take appropriate measures.”

Titled ‘allegations of racketeering in the Central Bank of Nigeria; disparity in allocation of foreign exchange’, and addressed to Emefiele, the letter was delivered to the CBN governor’s office on Monday.

The minister, in the letter, said he became aware of the corruption allegations through several petitions.

Four major allegations contained in Malami’s letter to Emefiele include alleged corruption in the apex bank’s “foreign exchange allocation transactions.”

The second is “questionable policy” in the apex bank’s allocation and sale of foreign currency to Nigerians.

The third is the issue of “arbitrary allotment of different exchange rates for same purposes” by the CBN.

The last is allocation of conflicting foreign exchange rates by the CBN.

The letter partly read, “Some of these petitions have been supported by several documents allegedly showing that the central bank has implemented a questionable policy in its allocation and sale of foreign currency to Nigerians.

“It is further alleged that this arbitrary allotment of different exchange rates for same purposes at the same time is being pursued as policy by the Central Bank of Nigeria. See attached documents from Leadershipng publication.

“Also attached is a report of the October 2016, allocation of conflicting foreign exchange rates by the central bank.

“In view of these allegations of corruption and arbitrary allocations of foreign exchange to a certain class of persons, you are kindly requested to comment on these allegations to enable us to advise the Presidency and take appropriate measures as may be dictated by the circumstances of the case.”

Media reports, relying on the document tiled ‘Bank utilisation report on 60:40 rule for October 2016’, which was attached to Malami’s letter sent to the CBN governor, had raised allegations of corruption and the implementation of questionable foreign exchange allocation policy.

In October 2016, alone, as revealed by the document, no pattern or template could be deciphered to have been used in calculating the exchange rates.

The criteria used in selecting the firms or sectors for which certain volume of foreign exchange was allocated and at what rate could not be pinned to any template.

The 1,312-page document revealed the names of various customers, their corresponding addresses, form numbers, amount allocated to them (in United States dollars), the items or purposes, the sector and the banks used for the month of October alone.

It shows how some companies and individuals got foreign exchange in US dollars at the rates as low as low as N0.61 to $1 while others got it in rates that were as high as N470 to $1.

For instance, an individual got $4,327 at the rate of N23.34 to $1 through “credit card payment” for “invisible” purpose and under “invisible sector”.

A bank also got $3,589.11 at the rate of N3.19 to $1 also for “invisible” purposes and under “invisible” sector.

There was a transaction involving sale of $66.72 at the rate of N0.62 to $1.

There was also a sale of $5.56 to a company at the rate of N0.61 also for “invisible” purposes.

A particular transaction also involved the sale of $570.8 at the rate N3.17.

In contrast, there was a company, who purchased $1,462,480.83 at the rate of N425 to $1.

The document shows that individuals and companies got foreign exchange for purposes ranging from importation, PTA, school fees, “invisible”, family maintenance allowances, mortgage payments and medical travel among others.

But the CBN had debunked the allegations in a publication posted on its website on January 30, 2017.

The publication titled ‘CBN clarifies alleged wrong FOREX purchase figures’, was signed by the apex bank’s Acting Director, Corporate Communications, Mr. Isaac Okorafor.

The bank stated that it neither allocated foreign exchange nor did it deal directly with bank customers.

Insisting that its forex policy was transparent, the apex bank also said it was not responsible for fixing FOREX rates for transactions by individuals or companies.

The statement read, “Following  media  reports alleging  irregularities  in  the  rates  at  which foreign  exchange  was  obtained  by  some individuals  and  companies from  different Deposit  Money  Banks under  the new  [60:40] Foreign  Exchange  Policy  by  the Central  Bank  of  Nigeria,  which prioritises  FOREX  sales  to  manufacturers, agriculture,  plant  and machinery,  critical  raw materials,  among  others,  we  wish  to  make the following  clarifications:

“The  Central Bank  of  Nigeria  neither  allocates  foreign exchange nor  does  it  deal  directly  with  bank customers;

“The CBN does not fix FOREX rates for  transactions  by  individuals or companies.

“In  line  with  our  principle  of transparency,  we  directed  DMBs  to forward to  us  evidence  of  FOREX  sale  to  end users  and  to advertise  same  in  national dailies.

“Since  the  introduction  of  the  new FOREX  Policy  in  2016,  we  have published, monthly,  the  evidence  of  sale  from  DMBs, as  received from  the  banks  and  without  any alteration  by  us  in  the  spirit  of transparency.

“We  have  recently  observed,  however,  that some DMBs forwarded  inaccurate  data, which  were  erroneously published  and  gave a  wrong  impression  of  disparate rates;

“The DMBs involved in providing inaccurate data  have  since  been issued  queries accordingly.  Some  have  returned  a response, indicating  that  some  of  the  figures were related  to formatting errors, which  do not  affect  the  true  rates  of  the  affected transactions.

“As  the  constitutionally  authorised  industry regulator,  mandated  to manage  the  FOREX market,  maintain  external  reserves  and  to safeguard  the  international  value  of  the legal  tender  currency,  we  wish to  state unequivocally  that  the  CBN  has  a  duty  to perform  and  would not  indulge  in  acts capable  of  discrediting  the FOREX  market.

“We  therefore  wish  to  reiterate  that  the  sale of  FOREX  under  the  new policy  is  most transparent  and  it  is  not  intended  to  benefit any individual  or  corporate  body  in  anyway.”

Source: Punch