From Adanna Nnamani, Abuja
The Central Bank of Nigeria (CBN) has said it will not pay for any shady or fraudulent foreign exchange (FX) deals that did not meet its rules. This comes after the bank completed a detailed audit into several FX forward contracts that were never delivered.
The CBN warned that it is ready to take strong legal action against those found to have broken its rules. This could include civil, administrative or even criminal charges.
The warning was made in a public document titled “Frequently Asked Questions on the Settlement of Undelivered Forward Contracts”, published on the bank’s website.
“Is any legal action being taken against those parties deemed to have breached rules?
“The CBN is reviewing appropriate legal action against parties found to have violated applicable rules and regulations, based on the findings of the forensic audit.
“The Bank will collaborate with law enforcement and regulatory agencies to pursue civil, administrative, or criminal sanctions, as necessary,” the bank said.
To ensure honesty and accountability in the FX market, the CBN had in September 2023 hired Deloitte, a global audit firm, to dig deep into the records of FX transactions done under its Retail Secondary Market Intervention Sales (RSMIS) scheme. The main goal was to check whether the FX requests were genuine and followed CBN guidelines.
The audit revealed several abuses. Some companies submitted incomplete or fake documents. Others tried to import banned items, inflated their invoices, or submitted contracts with inconsistent company names. In some shocking cases, the companies had no real business transactions at all. A few even listed items that had no clear explanation or purpose.
The CBN made it clear it has “no obligation to honour any FX forward request tainted by fraud, misrepresentation or regulatory breach.”
It added that all clean and properly documented contracts had already been paid for, while those that were found to be fake were cancelled, and the Naira deposits returned to the companies involved.
The bank explained that paying for the fraudulent contracts would have “undermined regulatory compliance, encouraged impunity, and unnecessarily depleted Nigeria’s foreign reserves.”
The CBN also said that the audit process was fair, and every bank and client involved was given the opportunity to explain themselves. However, it stated that the process is now complete and that “the matter is closed and not subject to appeal.”
The CBN further warned that only forward contracts that are properly documented and follow all regulations will be considered valid. It stressed that it remains fully committed to “transparency, market integrity, and prudent management of the nation’s reserves.”
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