14th December 2024
By Idris Buba
Deposit Money Banks found guilty of aiding the illegal flow of mint naira notes to currency hawkers and dubious agents, will henceforth risk a fine of N150 per branch by the central bank of Nigeria CBN.
CBN revealed it new stand on illegal distribution of mint naira note in a circular signed by the Acting Director of the Currency Operations Department, Mohammed Olayemi, issued on Friday, December 13, 2024,
The apex bank through the circular expressed it concern about the increasing prevalence of mint naira notes being traded by hawkers, which has negatively affected efficient and effective cash distribution to genuine end users.
The circular, is sequel to an earlier directive dated November 13, 2024, highlighted the apex bank’s determination to address the commodification of the naira.
Under the CBN directive, any branch of a financial institution found culpable will pay a penalty of N150m for the first violation while subsequent infractions would attract stricter sanctions as provided in the Banks and Other Financial Institutions Act, BOFIA, 2020.
The CBN said it has put machinery in place to ensure compliance by deposit banks..
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The circular read, “The CBN has noted with dismay the prevalence of illicit flow of mint banknotes to currency hawkers and other unscrupulous economic agents that commodify Naira banknotes, thus impeding efficient and effective cash distribution to banks’ customers and the general public.
“CBN will continue to intensify the periodic spot checks to the banking halls/ATMs to review cash payouts to banks’ customers, as well as mystery shopping to all identified cash hawking spots across the country.
“In this regard, any erring deposit money banks or financial institutions that are culpable of facilitating, aiding, or abetting, by direct actions or inactions, the illicit flow of mint banknotes to currency hawkers and unscrupulous economic agents that commodify Naira banknotes shall be penalized at first instance N150,000,000.00 (One hundred and fifty million Naira) only, per erring branch, and at later instances, apply the full weight of relevant provisions of BOFIA 2020.”
The CBN further urged DMBs to strengthen controls, processes, and procedures around their Cash Management Centres, branches, and teller operations to prevent their systems from being exploited for illegal transactions.
