CBN probes 12 firms for forex infractions, freeze bank accounts
* Court grants permission to freeze accounts
* Allegations of illegal importations
The Central Bank of Nigeria (CBN) is investigating the activities of 12 companies discovered to have engaged in foreign exchange manipulations and causing negative impacts on the domestic forex market.
The regulatory bank said the companies have been engaging in the importations of some items excepted from official foreign exchange allocations and were found to be involved in the manipulation of the foreign exchange market.
“The activities of the defendants/respondents being investigated are the cause of the current volatility and imbalance in the foreign exchange regime in Nigeria with the attendant negative impact on the economy,” the regulatory bank said in a court paper. Nigeria detains Angola Airlines for illegal entry into airspace
Already, a Federal High Court in Abuja has granted the CBN power to freeze the bank accounts linked to the 12 firms and its owners to enable the regulatory bank to conduct investigations into the activities of the companies.
The CBN in a court paper said the activities of the firms and an individual identified as Adekunle Olusola Alonge, are “the cause of the current volatility and imbalance in the foreign exchange regime in Nigeria with the attendant negative impact on the economy.”
“The investigation being carried out concerns what has been discovered to be serious infractions by the defendants/respondents in connection with some transactions, and non-documentation by the defendants/respondent in violation of the CBN circular TED/FEM/GEN/01/010 on “Inclusion of some imported goods and services on the list of items not valid for foreign exchange in Nigeria’s Foreign Exchange Market” of June 23, 2015,” a deputy manager in the CBN governor office, Innocent Okocha said in the court paper.
“More specifically, there is a grave allegation that the defendants//respondents are engaged in accessing/procuring of foreign exchange from the Nigerian Foreign Exchange Market in furtherance of the smuggling/importation of goods which fall under goods and services prohibited under the circular referenced in paragraph (b) above.
“The aforesaid transactions undertaken by the defendants/respondents using their bank accounts can cause significant financial loss to members of the public if Ieft unchecked,” the regulatory bank claimed.
“A freezing order of this honourable court in respect of the defendants/respondents’ aforesaid accounts would also enable the CBN to investigate the activities of the defendants/respondents to a logical conclusion.
Listed in the motion as the owners of the affected accounts are: Adekunle Olusola Alonge, Armadillo Integrated Services, FTM Capital Management Limited, Sonora Asset Management Limited, Sonora Capital & Inv Ltd, Sonora Capital Investment Limited, Sonora Capital & Investment Limited and Sonora Capital and Investment Limited.
Others are Sonora Capital Investment Limited, Sonora Consult, Sonora Energy & Allied Services Limited, Sonora Energy and Allied. Services Limited, VIP Impress Hollywood Limited and Vlisco Nigeria Limited.
he CBN had twice this year adjusted the exchange rate downward in a bid to conserve available dollar and curb pressure on the foreign exchange reserves.
However, in spite of the two devaluations of the naira at the official market this year, the CBN had been unable to meet domestic demand for the dollars from importers and even the offshore portfolio investors wanting to take out their money from the country.
The Director-General of the Lagos Chamber of Commerce and Industry, Muda Yusuf said that the dollar shortage is hitting most of its 2,000 members hard.
“If the situation persists it will lead to lay-offs, If you are not producing, there will be a shortage of goods in the market, prices will go up,” Yusuf told a news agency in the week.
Many companies are now resorting to sourcing their dollar needs from the black market, where the naira trades at around 20 percent below the official rate, making dollar purchases even more expensive.
The naira closed at N477 to the dollar on the parallel market on Friday and N386 per dollar on the investors’ and exporters’ (I&E) window.