CBN Writes MTN To Refund $8.13bn Repatriated Via Forged Papers

• Fines StanChart, Stanbic IBTC, Citi, Diamond Banks N5.87bn

Even before paying the fines for its last infraction (sale of pre-registered sim cards in the country), telecommunications giant, MTN Nigeria, is in yet another troubled waters (READ).

This time, with the Central Bank of Nigeria (CBN), which at the midweek said it has written the subsidiary of the South African giant to refund a total of $8,134,312,397.63 repatriated using ‘fake’ Certificates of Capital Importation (CCIs) between 2007 and 2015.
The company, which continues to delay the listing of its local arm on the Nigerian Stock Exchange (NSE) (READ MORE), being a condition for relaxing the previous fine, is accused of ‘flagrant violation of extant laws and regulations of the Federal Republic of Nigeria.”
Specifically, MTN Nigeria is accused of violating “the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act, 1995 of the Federal Republic of Nigeria and the Foreign Exchange Manual, 2006.”

The CBN also imposed fines totaling N5.68bn fine on: Standard Chartered Bank, Stanbic-IBTC, Citibank, and Diamond Bank, whose managements were, along with that of MTN directed “to immediately refund the sum of $8,134,312,397.63, illegally repatriated by the company to the coffers of the (CBN).”

A statement by the CBN on Wednesday, August 29, 2018, quoted its Director, Corporate Communications, Isaac Okorafor, as saying the regulatory sanctions 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.”

A breakdown of the fines by the CBN showed that while a fine of N2,470,604,767.13 was slammed on Standard Chartered Bank; Stanbic IBTC Nigeria is to pay N1,885,852,847.45. On its part, Citibank Nigeria was directed to N1,265,541,562.31 penalty, and Diamond Bank, N250m for violating extant rules.
Investigations by the CBN into 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, showed that a total of $3,448,119,321.72 was repatriated by Standard Chartered Bank on the basis of the illegally issued CCIs.

Another $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. Accordingly, he said the CBN had directed the affected banks to immediately refund the respective sums to the CBN.

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.

While disclosing that the investigations by the CBN took a while in order to carry out thorough inquiry and give fair hearing to all parties involved, Okorafor advised all banks and multinational companies in Nigeria to adhere strictly to the provisions of all extant laws and regulations of Nigeria in their foreign exchange transactions. 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.

https://investdata.com.ng/2018/08/cbn-writes-mtn-to-refund-8-13bn-repatriated-via-forged-ccis/