Stoppage of forex sale to BDC: HEDA tells FG to sanction defaulters

Human and Environmental Development Agenda (HEDA) has called on the Central Bank of Nigeria (CBN) to sanction Deposit Money Banks (DMBs) and to Bureau de Change (BDC) operators that fraudulently engage in the foreign exchange transactions.

The CBN Governor, Godwin Emefiele, had, at the end of the Monetary Policy Committee (MPC) meeting in July 2021, announced the stoppage of Forex sale to BDC operators.

HEDA, in a statement by its Chairman, Olanrewaju Suraju, recalled that only the CBN was supposed to sell Forex to DMBs for onward sale to the public for Personal Travel Allowance (PTA), Business Travel Allowance (BTA), tuition fees, medical payments, Small and Mdium-sized Enterprises (SMEs) transactions among others.

CBN had adduced rent-seeking and involvement in money laundering as reasons for its decision to discontinue the sale of foreign currencies to BDCs.

The civil society group also noted the CBN had reported sharp practices by some unscrupulous customers to circumvent its new policy on the sale of Forex.

Suraju lamented: It appears the measure is insufficient as a deterrent for defaulters, as this act of economic sabotage is still perpetrated non-stop by unscrupulous members of the society.

“Those who fraudulently collect foreign currencies and sell to BDCs or black market vendors are clearly causing economic adversity to the Federal Republic of Nigeria. Their action is not only fraudulent, it is clearly a financial crime and economic sabotage.”

He recommended that, in addition to the above measure, the CBN should direct all DMBs to report such law-breakers to the Economic and Financial Crimes Commission (EFCC) for investigation of possible money laundering offences and illicit financial flow and onward prosecution, if found culpable.

The CSO affirmed that in February 2022, commercial banks revealed identities of over 1,226 defaulters accused of purchasing the dollar at official rates without embarking on that trip, which afforded them the advantage of getting the foreign currency.

“We strongly believe that adopting our recommendation will fortify this CBN policy on Forex transaction for the benefit of the Nigerian economy and help to stabilise the naira against other foreign currencies. HEDA Resource Centre shall continue to support and collaborate with CBN in the fight against corruption and illicit financial flow in Nigeria,” he added.