People & Money

CBN Expands Forex Abuse Investigations from Betting Firms to 55 Companies

The Central Bank of Nigeria (CBN) has teed off a forex probe into the activities of 55 firms and persons in the currency market, after an initial scrutiny pointed in the way of probable breach of extant foreign exchange laws.

The suspected foreign exchange transactions infractions largely have occurred outside the over-the-counter spot market alternatively known as Investors and Exporters (I&E) forex window. The window serves formal sector operators who meet certain requirements, mainly centered around buying forex for purposes approved by the CBN.

In August 2020, the apex bank got a court order to freeze the firms’ accounts, which are said to have been responsible for volatility in forex exchange. The CBN alleges that the firms and individuals 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 betting firms under the CBN radar for possible forex regulations infractions have purchased and transferred foreign exchange to purported foreign technology partners after being refused the approval of the National Office for Technology Acquisition and Promotion (NOTAP) which is required to buy forex from official-recognized (CBN) sources.

Industry watchers think there is a suspicion that the betting firms may be involved in money laundering. The usual forex regulations infraction has for more than four decades been to purchase foreign exchange at cheap official rates and sell for higher amounts in the parallel or black market, a very lucrative practice known as “arrangee” in the 1970s and as “round tripping” from the mid 1980s. Firms that handle large volumes of cash are thought to be ideal vehicles for money laundering.

Also Read: Despite CBN Interventionist Strategies, Naira Exchanges for N462

Given the experience of over 40 years, it is very unlikely that the CBN’s hawkish approach would have a significant impact on dissuading people from abusing the regulations that govern foreign exchange transactions. The incentives to abuse the system is very high precisely because of the multiple exchange rates the CBN maintains. The opportunity for arbitrage i.e. buying dollars at official rates and selling in the black market at high rates, seems the real source of “volatility” of the naira’s value rather than the activities of those who have always sought to capture the massive administratively created rents.

 

The companies and individuals under scrutiny are:

  1. Stallion Nigeria Limited
  2. Solem Agro Limited
  3. Deekay & Sons Limited
  4. Hana Nigeria Limited
  5. Emel Nigeria Limited
  6. Sonnex Nigeria Limited
  7. Montana Nigeria Limited
  8. Daraju Nigeria Limited
  9. Dasco Nigeria Limited
  10. Savvy Corps Limited
  11. Pan-Cat Nigeria Limited
  12. Mustafa-Multipurpose Services
  13. Olayfis Global Resources Limited
  14. Pals Interchange Concept Limited
  15. 2015 Petroleum & Investments Limited
  16. Manann Nigeria Limited
  17. Brollo Pipe & Profile Ind. Limited
  18. Altrunk Nigeria Limited
  19. Dartford Energy Services Limited
  20. Global Links Ventures Limited
  21. Elemental Integrated Associates
  22. New Home Distribution (Africa)
  23. ACCI Ventures (Nig) Limited
  24. Dover Engineering Limited
  25. John Kell & Associate Nigeria
  26. Maaway Ventures Limited
  27. Good Metal Enterprises
  28. Medlog Logistics Services Limited
  29. Interswitch Nigeria Limited (Dollar Acct)
  30. Beirut Hill Construction Limited
  31. CMA CGM Nigeria Shipping Limited
  32. Agrinexus International Limited
  33. Sylvangel Maritime Resources Limited
  34. Unimer SRL Limited
  35. SCIB Nigeria & Company Limited
  36. Domenik LLC
  37. Petro-Afrique Energy Services
  38. Silver Dome Enterprises Limited
  39. Ajibola Bankole Adebutu
  40. Petro-Afrique Energy Services Limited
  41. Steel Force Far East Limited
  42. Stemcor London Trading Limited
  43. Fix Nigeria Limited
  44. SA Turutu International Ent
  45. New Brand Metals Global Limited Ventures
  46. Auto Petroleum Company Limited
  47. Cavendish Mechanicals Limited
  48. Aquashield Oil & Marine Limited
  49. Haitch & Elf Integrated Services Limited
  50. Fenog Nigeria Limited
  51. Promasidor Nigeria Limited
  52. Hatford Resources Nigeria Limited
  53. Don & Chyke Nigeria Limited
  54. BCL Trading Services Limited
  55. Omniworx Export Enterprises
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