FG Orders EFCC to Probe Banks, Others Behind Forex Malpractices

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Attorney-General of the Federation (AGF) and Minister of Justice, Mr. Abubakar Malami

Alex Enumah in Abuja

The Attorney General of the Federation (AGF), Abubakar Malami (SAN), has disclosed that the federal government is ready to prosecute any person suspected to have engaged in foreign exchange round-tripping, among other malpractices in the foreign exchange markets.

To this end, he said he has directed the Economic and Financial Crimes Commission (EFCC) to investigate and confirm information available to government on the nefarious activities of persons and banks involved in such practices within and outside the country.

“Let me restate in the strongest terms that these nefarious malpractices by unscrupulous individuals and institutions will no longer be tolerated. In this regard, measures are already in place to deal with the infractions decisively and relevant security agencies are on the red alert to investigate these infractions and appropriate sanctions shall follow accordingly,” he said.

Malami, who made the disclosure to newsmen wednesday in Abuja, said the government had done its preliminary investigations and has proof, adding that all that was left was for EFCC to commence the probe and prosecution of all the indicted persons and institutions that had illicitly profiteered from the wide spread between the official rate of the dollar and the parallel market rate.

According to him, available reports at the disposal of the government had confirmed suspicions that the current value of the naira was not reflective of economic factors or demand and supply forces alone, but was the deliberate action of some individuals who are undermining the current efforts of the present administration to reposition the economy on the path to sustainable growth through diversification and greater accountability.

He further disclosed that the federal government was aware of the insidious activities of certain elements within some strategic national institutions, who rather than exert their regulatory powers, have chosen to use their strong accomplices within the system to manipulate the foreign exchange market for personal corrupt gains to the detriment of the national economy.

“It has become obvious that having failed in the attempt to force devaluation, certain forces have now aligned to create an artificial situation whose primary purpose is to undermine the economic programmme of the Buhari administration.

“We are witnessing manipulation and coordinated speculative activities in the foreign exchange market leading to the current wide differential between the official rate at the Central Bank of Nigeria and the parallel market rate in a manner that defies rational economic analysis,” he said.

Some of the offences alleged to have been committed by these institutions and individuals include forex round-tripping, rendition of false forex utilisation data, non-repatriation of export proceeds, use of forex for non-eligible purposes, consumption of forex transactions with inadequate, expired and or forged documents, and failure to report forex end users who default in the submission of required documents, amongst others.

While assuring the public that the government would continue to provide a sustainable platform for the forex market to thrive in Nigeria, Malami appealed to all Nigerians to support government’s efforts in sanitising and stabilising the forex market for the good of all.

He added that “government has emphatically restated its priority responses which will be geared towards diversifying the economy, promoting greater accountability within the system by blocking leakages of revenue, undertaking a robust assets recovery process in Nigeria and overseas, and prosecution of all treasury looters in accordance with the law”.

  • The Analyst

    Poor Strategy.
    You hand a fat piece of Cheese to hungry, greedy mice and start spend your time and energy making sure they don’t eat it!!!!

    • Daniel

      That is the language Nigerians understand.

      • dozie

        Why the trouble, simply close the gap between official and parallel market rates and all the trouble will disappear.
        Suggestions to close the gap: For a start, Mr President and the CBN governor should mind how they talk. Careless talk creates panic which widens the gap. Buhari should leave fiscal and monetary policy talks to Emefiele who should weigh his words carefully. 2. Return all removed items back to the official list. Actually there should be no official list or banned items. Use import duties to discourage certain imports to protect local manufacturers. 3. Provide electric power, low interest loans and security to encourage local manufacturers. 4. Get out of petroleum refining and supply business, 5. Stop dictating what Nigerians should or should not do with their hard earned money. That is a relic from the military era and has no place in a democracy. 6. Recruit competent economists

        • Daniel

          The naira cannot immediately appreciate in value because it was backed by oil money that has declined. We had no savings too, yet no infrastructure to show for the stupendous spending of past administrations.

          There are no short cuts. Now it is time to have alternatives to oil and reduce sources of waste such as unprofitable importation that demand lots of dollars as well as corruption.

          Devaluation is not an option. The other sectors will get a boost once the 2016 budget is passed. Over 30 per cent of a 6 trillion naira budget for capital projects is huge and unprecedented.

          Be patient.

          • dozie

            Yes, there should be no short cuts. Drawing up lists of items not permitted to access foreign exchange is a SHORT CUT, responsible for the wide gap in the exchange rates which, in turn, is responsible for the round tripping which now needs fire fighting. Emefiele should have known better.
            6 trillion naira budget, Wow! I hope they aren’t planning on printing more naira to finance the budget which, to a large extent, ends up stolen or mis-managed. Pls don’t tell me it will be different now.
            Other sectors will get a boost, similar to the telecom sector boost, once govt. gets out of their way. e.g. petroleum sector upstream, midstream and downstream. Economic boost cannot be conferred by the wasteful annual budgets that will end up stolen to a large extent.
            We are adults, we don’t need government to tell us what is profitable or unprofitable, and how we should spend our hard earned money. We don’t need a NANNY state. Government can encourage local production by direct support and discourage imports by higher custom duties as normal countries do, and not by the crude short cut of restricting access to foreign exchange, with the attendant consequences of widening exchange rate gap and round tripping. Enough of the barrack mentality.

          • Daniel

            Sorry, if you are affected. Enough procrastination. You can seek your forex somewhere to import those items or produce them locally. I think Nigerians can learn to do without eating rice, if we decide not to grow rice on our vast arable land.

            And for those engaging in smuggling, everyday is no xmas. It is a fifty/fifty chance.

          • dozie

            Think through your suggestions please. In one paragraph you advise people to seek forex elsewhere to import those items and in another you warn about smuggling. Do you suggest ban or exclusion from official forex. Either is bad though as they create fertile ground for corruption and round-tripping.

            It’s good to have patriotic zeal but zeal without sound economic policies did not work in 1984 and will not work now. Fire fighting actions will only destroy the modest gains towards being a normal country that we had achieved in the last decade like single forex rate +/- 1% for parallel market, self sufficiency in cement production, telecoms and banking sector revolutions, high foreign direct investments etc. These were not achieved by knee-jerk fire-fighting actions but by careful thoughtful analysis, deliberate actions and long term view.

          • Daniel

            What did Jonathan leave behind for you that is no more there for you to enjoy? I would advise you direct your anger in the right direction, not Buhari.

            Buhari was voted to solve problems certainly not to perform magic. Why? We are a mono-cultural economy : oil drinkers.

            To get out of that will take time. I mean to develop other sources of revenue. By the way what are the governors doing? Are they still in the country?

          • dozie

            You are now sounding partisan. I will have to withdraw now. Thank you.

          • Daniel

            Nothing happens in a vacuum. History matters. We failed to plan for the rainy day. Buhari cannot just after ten months take the blame of 16 years of lack of investment or savings in our economy. It is a chain reaction.

            We expect Buhari to solve problems certainly not perform magic. The economy has a structure which needs to change. That is not a ten-month job. And why are you not angry at the huge sums stolen? Oh that has nothing to do with the economy? Or it is not true?

            We need to properly situate the source of the problem. Patience is needed to turn things around.

  • Rzg

    GTB bank is charging black market rates to users of its GT Mastercard, when they purchase on the internet or withdraw money abroad. Start from them please !!! They are rogues !!!

    • vic

      PRESIDENT BUHARI, PLEASE TAKE A NOTE OF THIS FOR SERIOUS ACTION ON THE FRAUDULENT FOREX ACTIVITIES OF THESE BANKS.

      ENOUGH IS ENOUGH.

  • vic

    mr buhari, parallel market should only have a spread of 3% while buying and selling dollars or pound sterling to customers.

    there should be an imprisonment of at least 10 years for any dealer caught not obeying this rule because this is an act of sabotage against the economy of the country.

    mr buhari, this is fraudulent looter nigeria and these forex vagabonds will only adhere to regulations when punished heavily. nigeria has dollars in abundance, only the exchange rate needs to be monitored and regulated more strictly. hoarders of dollars should also need to be punished and the hoarded dollars confiscated by the federal government, considering that legal tender in nigeria is naira and not us dollar. if there is compliance to this rule, the 33% difference between the official and parallel market will disappear in no time. it is also high time to investigate how nigerians got their dollars in their domiciliary accounts in nigeria which now run into at least 20 billion dollars. the majority of culprits are the top politicians in nigeria including atiku and tinubu, almost all state governors, senators, members of national and state assemblies and ministers,etc,etc,etc.

    mr buhari, this parallel market forex rot is found throughout nigeria with the politicians themselves the biggest culprits. may be, you should put into action, DOLLAR FRAUD SQUAD whose job will be to raid the suspected houses to look for illegitimate hoarded dollars. there is no way out from this dollar and forex rot unless and until you decide to land heavily on the forex culprits in the country with cbn governor, godwin emefiele being the first on the firing line. all forex corruption in the nigerian banks starts from him- his inability to control the forex fraud in the banks under his control and jurisdiction.

  • vic

    MR BUHARI, MAKE SURE THAT THE NIGERIAN BANKS CHARGE THE OFFICIAL RATE OF FOREX WHEN PAYING LEGITIMATE PENSION RIGHTS TO NIGERIANS AND FOREIGNERS WHO RETIRED FROM NIGERIA AND ARE DOMICILED ABROAD.

  • vic

    AND MR BUHARI, ONE SUCH BIG FOREX SABOTEUR AND FOREX MANIPULATOR IS THE CBN GOVERNOR, MR GODWIN EMEFIELE. UNLESS THE MAN AT THE ROOT OF THIS FOREX EVIL IS SACKED, FOREX DIFFERENTIAL OF 33% WILL LINGER ON FOR EVER, NO MATTER HOW GOOD IS THE ECONOMY OF THE COUNTRY THROUGH DIVERSIFICATION. THIS HUGE FOREX DIFFERENTIAL EXISTS BECAUSE CBN GOVERNOR, AS AN INSIDER IS AIDING AND ABETTING FOREX FRAUD IN THE NIGERIAN BANKS, OF WHICH HE IS THE CHAIRMAN. THESE NIGERIAN BANKS UNDER HIS WATCH, ARE HUGELY GEARED TOWARDS ILLEGAL PROFITEERING AND HAVE MADE BILLIONS AND BILLIONS OF NAIRA THROUGH THIS FRAUDULENT FOREX TRADE WITH FAKE RETURNS SENT TO CBN AFTER SELLING FOREIGN EXCHANGE TO THEIR SELECTIVE BIG TIME CUSTOMERS IN THE NAME OF FAKE IMPORT BUT JUST TO TURN AROUND TO SELL THE SAME DOLLARS GOTTEN AT OFFICIAL RATE OF N197 TO A DOLLAR AT N350 TO A DOLLAR KNOWING FULLY WELL THAT THEY CANNOT MAKE SUCH INSTANT GUARANTEED PROFITS BY IMPORTING THEIR SO-CALLED RAW MATERIALS. MR BUHARI MUST LOOK INTO THIS AND DISMANTLE THIS WEB OF FOREX FRAUD ENTRENCHED INTO THE NIGERIAN BANKING SYSTEM IF YOU ARE TO SUCCEED TO REVIVE THE NATIONAL ECONOMY. MR BUHARI, YOU WILL RECALL THAT IN 1972 WHEN NIGERIA HAD NO OIL AND GAS, A NIGERIAN POUND THEN WAS SELLING FOR 2 DOLLARS.

  • Artful ºDodger

    The solution to these problem is simple if indeed anyone is serious about solving the problem. CBN issues forex to banks based on the documents they have provided from their customers who need forex for imports. Pass these import/export documents over to the customs and excise to await the goods at the nation´s ports. If these items do not arrive or leave as specified simply swoop in on the importer/exporter and fine the bank that came up with the demand 120% of the value of the forex issued. These way no one will round-trip. Harsh yes, but it is the only language the Nigerian will understand!

  • vic

    AGF, WHEN YOU CATCH THOSE BANKS AND INDIVIDUALS FOR ROUND TRIPPINGS FOR FOREX FRAUD, PLEASE PUBLISH THEIR NAMES ON THE PAGES OF NATIONAL NEWSPAPERS AND INFORM THE PUBLIC WHAT PUNISHMENTS ARE METED OUT TO THEM TO TEACH AN OBJECT LESSON TO OTHERS SO AS NOT TO INDULGE IN ECONOMIC SABOTAGE OF THE NATION.

  • Akatikpo

    All noise no substance. I will, I will. We are tired of empty threats. This government lacks vision and intellectual sagacity. This Attorney General is very infantile and talks like a tout. He is a disgrace to the rank of SANs. The greatest threat to the stability of the forex market is the utterances of the President. They should coach him on how to talk. The CBN will make one policy statement only to be countered by the President. I don’t believe that round tripping is the cause of the present forex brouhaha. We have always had round tripping yet we’ve not had the market implode on us. The AG should look for another excuse. Always blaming one thing or another for their naivety and cluelessness.

    • The Analyst

      For once I see a smart person in this forum. My Brother God will bless you.
      So far in this govt, there has been no Plan.
      Smart govts have their cabinet b4 swearing in and hit the ground rolling.
      Smart govts have their budget “PLAN” ready for implementation by 1st of the Annual year.
      We have a govt with Head quarters at the Federal High Court Abuja and Branch at Federal High Court Lagos!
      They are wasting their time chasing all sorts of irrelevant shadows while all other sectors are at standstill. Not a stone lifted in Agriculture, Health, Transport, Petroleum, etc…Nothing!
      Most annoying part is even the common Forex that the private sector manages to keep employment in the country is now being messed up…
      and what do we get in return? Excuses!
      They have finally run out of “Jonathan” excuses, now they turn the blame on every other person!