CBN Fines Four Banks for Illegally Aiding MTN in Repatriating $8bn Forex

MTN has apparently gotten itself into more trouble with Nigerian regulators. The Central Bank of Nigeria has hammered four Nigerians banks a total of N5.86 billion for illegally helping the telco repatriate $8.134 billion back to South Africa.

The four banks include Standard Chartered Bank (₦2.4 billion), Stanbic IBTC (₦1.8), Citibank (₦1.2 billion), and Diamond Bank Plc (₦250 million).

#CBN Slams N2.4bn fine on Standard Chartered, N1.8bn on Stanbic IBTC, N1.2bn on Citibank, N0.25bn on Diamond Bank. All to also refund a total of $8.134bn for breaching Nigeria’s forex regulations on MTN’s illegal capital repatriation.

— Central Bank of Nigeria (@cenbank) August 29, 2018

Based on an investigation by the regulator, $8.134 billion was illegally transferred between 2006 and 2016. And the CBN said it just had to act on the matter. Evidently, the remittances were a flagrant violation of extant laws and regulations of the Federal Republic of Nigeria.

In a statement yesterday, Mr. Isaac Okorafo, Director of Corporate Communications at CBN, shared that the offending banks used illegally used Certificates of Capital Importation (CCIs) to initiate the transfers. He gave a breakdown of just how much was transferred by each bank.

According to the statement, Standard Chartered Bank transferred a total of $3,448,119,321.72; $2,632,005,623.78 was transferred by Stanbic IBTC Nigeria; $1,766,263,212.75 by Citibank Nigeria; and Diamond Bank facilitated the transfer of $348,914,501.30.

Okoroafor said the decision followed thorough investigations into the allegations of remittances by the four banks of forex with irregular certificates of CCIs issued on behalf of some offshore investors of MTN Nigeria Communications Limited.https://t.co/IbKFuyB4wF

— The Nation Nigeria (@TheNationNews) August 30, 2018

MTN Forex Fraud Revealed in 2016

Now, the issues surrounding the illegal repatriation of forex is not a new one. The matter was first brought to the limelight by Senator Dino Melaye (APC, Kogi West). In a motion presented before the Senate way back in 2016, Melaye asked for a thorough investigation into MTN’s forex transfer history.

He accused the four banks, including the current Minister of Trade and Investments, M.r Okechukwu Enelamah, of illegally aiding the telco.

The Senate conducted some investigation on the allegations but absolved MTN of any wrongdoing. It however did recommend sanctions against Stanbic IBTC bank “for improper documentations in respect of capital repatriation and loan repayments” on behalf of MTN.

A separate report by Sahara Reporters on August 27, 2018, showed that investigations into the matter had been concluded a while ago. But it alleges that the CBN Governor, Mr. Godwin Emefiele, had prevented the bank from taking action for up to two months.