Cardoso: Law enforcement agencies probing $2.4bn unverified FX claims

Olayemi Cardoso, governor of the Central Bank of Nigeria (CBN), says law enforcement agencies are investigating $2.4 billion unverified foreign exchange (FX) claims.

Cardoso spoke during a press conference on Tuesday after the 294th meeting of the monetary policy committee (MPC) in Abuja.

On February 5, Olayemi Cardoso, CBN governor, said he inherited a $7 billion FX backlog when he became the head of the apex bank in September 2023, however, it was discovered that $2.4 billion of the sum was invalid following an inquiry into the transactions.

Subsequently, the apex bank said all outstanding FX obligations had successfully been settled.

Providing clarification on the unverified claims, the CBN governor highlighted various irregularities, such as the disbursement of large sums of FX for requests that were never submitted and allocations made without the necessary naira backing. 

He said there was an absence of legal validity and adequate documentation in these transactions.

Cardoso also stressed the gravity of these irregularities, labelling numerous transactions under investigation as “clearly unlawful”.

“We brought in Deloitte management consultants who took time and this really did take months. This is not something that happened overnight and a lot of this work was going on and people didn’t know but they took months painstakingly to go through all the documents, all the documents and to ensure that you know, they would have a report, which we could rely on,” he said.

“In the course of that, of course, we determined that a number of these transactions did not qualify. In some cases, you had some allocations that were made in millions of dollars, which were never requested for.

“We also had somewhere they had no naira and they were also allocated, you know, huge sums of foreign exchange and the list goes on. It was for that reason that we refused to validate those particular transactions.

“We refused to validate them because apart from the fact that documentation was not satisfactory, in many cases, they were outright illegal. And the law enforcement agencies, of course, are now looking into those transactions that are, as far as we’re concerned, not valid to be paid. 

“I would emphasise that if there’s any information to the contrary, we would in due course consider that but as of today, that is exactly where it stands and the law enforcement agencies are taking a very, very hard look at those transactions.

“Other transactions, we have settled and as of today, as I have said before, I will say it again, that the valid transactions as far as the Central Bank of Nigeria is concerned, have been taken care of.”

‘FX MARKET IS AS OPEN, TRANSPARENT AS POSSIBLE’

Speaking further, Cardoso addressed the issue of stakeholders who may not be satisfied with the FX official market.

According to Cardoso, all verified claims have been settled, adding that anyone is free to access the market.

“We are also not mindful of the fact that there may be some stakeholders who over a period of time may have had backlogs in one form or the other,” he said.

“We are not unmindful that that could be the case. That some of those may go back, you know, years, a long period of time.

“We have done what we can to make the market as open and transparent and liquid as possible. So those particular stakeholders are free to access those markets and take care of the backlogs. We have met the verified backlogs of contractual obligations as we deem them forward transactions.”

Meanwhile, on March 21, foreign airlines in Nigeria said they do not support patronising the investors and exporters (I&E) window for foreign exchange (FX) transactions.