The Central Bank of Nigeria, CBN, has announced a fine of N150 million per branch on Deposit Money Banks (DMBs) and financial institutions found guilty of facilitating the illegal flow of mint naira notes to currency hawkers.
The apex bank stated this in a circular issued late on Friday, which was signed by the Acting Director of its Currency Operations Department, Solaja Mohammed Olayemi.
In the circular, the CBN said it was concerned about, “ the prevalence of illicit flow of mint naira notes to currency hawkers and other unscrupulous economic agents that commodify naira banknotes, thus impeding efficient and effective cash distribution to banks’ customers and general public.”
The regulator, which stressed that it would continue to intensify periodic spot checks to banking halls and Automated Teller Machines (ATMs) while deploying mystery shoppers to all identified cash hawking spots across the country, said that any branch of a financial institution found culpable will face a penalty of N150 million for the first violation.
Subsequent infractions, the CBN warned, would attract stricter sanctions under the provisions of the Banks and Other Financial Institutions Act (BOFIA) 2020.
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 penalised 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 also 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.
