CBN investigates violations of foreign exchange restrictions in the country

Tayo Oladipupo

The apex bank said it would investigate bank accounts of corporates involved in massive importation (dumping) of the 41 items which are “Valid for Foreign Exchange”, into the country.

This was contained in a circular entitled: “Foreign Exchange Restriction on the importation of 42 items”.

The Director of Financial Policy and Regulation Department, Ken Amogu said: “Trade information available to the CBN indicates circumvention of the policy as the restricted items are being dumped in the country.

“The implications are that the growth and employment benefits arising from the policy may be eroded if not checked.”

“The CBN views this development with trepidation. The Economic Intelligence Unit of the bank in collaboration with the Economic and Financial Crimes Commission (EFCC) would commence immediate investigation of the accounts of the corporate and entities engaged in this unwholesome act with a view to visiting severe sanctions on all culprits.

“Such sanctions would among others include blacklisting the corporate and their directors; closure of their bank accounts; and restricting them from maintaining any bank account in any bank under the CBN remit.

“Banks that provided their platforms for such economic abuses would also be appropriately sanctioned.

“Banks are by this notice advised on strict compliance with the Know Your Customer Business (KYC) and Know Your Customer Business (KYB) requirements and to be properly guided”

Recall that CBN had in 2015 issued a directive stopping some imported goods and services from the list of items valid for forex in the Nigerian Foreign Exchange Markets.

This policy implies that, those who import these items can no longer buy foreign currency from the official window to pay the overseas suppliers. Rather, they will have to source forex from the parallel market or Bureau De Change to pay for their imports.

The items include the following: Rice, Cement, Margarine, Palm kernel/Palm oil products/vegetables oils, Meat and processed meat products, Vegetables and processed vegetable products, Poultry chicken, eggs, turkey, Private airplanes/jets, Indian incense, Tinned fish sauce(Geisha/sardines), Cold rolled steel sheets, Galvanized steel sheets, Roofing sheets, Wheelbarrows, Head pans, Metal boxes and containers, Enamelware, Steel drums, Steel pipes.

Others are Wire rods(deformed and not deformed), Iron rods and reinforcing board, Wire mesh,
Steel nails, Security and razor wire, Wood particle boards and panels, Wood Fibre Boards and Panels, Plywood boards and panels, Wooden doors, Toothpicks, Glass and Glassware, Kitchen utensils, Tableware, Tiles-vitrified and ceramic tiles, Woven fabrics, Clothes, Plastic and rubber products, polypropylene granules , cellophane wrappers, Soap and cosmetics, Tomatoes/tomato pastes and Eurobond/foreign currency bond/ share purchases

The government had said that these items are not prohibited or banned. It only means that importers of these items are no longer qualified to get foreign exchange from the official market to import these items.