Fresh facts have emerged on why
the Central Bank of Nigeria (CBN imposed heavy sanctions totaling N5.87 billion
on Standard Chartered Bank, Stanbic-IBTC, Citibank, and Diamond Bank for
helping MTN to repatriate $8,134,312,397.63 illegally.
Standard Chartered was fined N2.4
billion, Stanbic IBTC Bank, N1.8 billion; Citibank, N1.2 billion, and Diamond
Bank, N250 million.
The CBN also asked the banks and
MTN to refund $8,134,312,397.63 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”.
Announcing the decision in Abuja,
CBN’s Director, Corporate Communications, Isaac Okorafor, said in a statement
that the actions of the apex bank became necessary following allegations of
remittance of foreign exchange with irregular Certificates of Capital
Importation (CCIs) 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.
The CBN spokesman further
disclosed that the decision of the bank followed thorough investigations by it
into the allegations of remittances by the four banks of forex with irregular
certificates of Capital Importation (CCIs) issued on behalf of some offshore
investors of MTN Nigeria Communications Limited.
He said the investigations
revealed that the sum of $3,448,119,321.72 was repatriated by Standard
Chartered Bank on the basis of the illegally issued CCIs. Similarly, he said
the sums of $2,632,005,623.78, $1,766,263,212.75 and $348,914,501.30 were
repatriated by Stanbic IBTC Nigeria, Citibank Nigeria and Diamond Bank Plc,
respectively, during the period 2007 and 2015.
The CBN 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.
He warned that failure by the
management of banks and companies to abide by the existing guidelines would be
appropriately sanctioned, which sanctions may include denial of access to the
Nigerian foreign exchange market.
In a letter by the CBN to MTN,
the apex bank said its investigations revealed among others that the
shareholders of MTN invested the sum of $402,590,261.03 in the company from
2001 to 2006 and that the investment was carried out through the inflow of
foreign currency cash transfers and equipment importation, which was evidenced
by the CCIs issued by Standard Chartered Bank, Citibank and Diamond Bank.
The bank added that “the CCIs
issued at the time of the investment by the above banks to your organisation in
respect of the $402,590,261.03 showed that $59,436,923.44 was invested as
shareholders’ loan and $343,153,339.56 as equity.
“However, a review of your
organisation’s financial statements for the year ended December 31, 2007
revealed that $399,594,146.00 was recorded/invested as shareholders’ loan and
$2,996,117.00 as equity investment, in accordance with the shareholder’s agreement
but contrary to the CCIs issued by the banks.”
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