Nigerian News from Leadership News

Reps Summon CBN Governor, Petroleum Minister over Forex Fraud

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The House of Representatives has summoned the governor, Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, Minister of State for Petroleum Resources Ibe Kachikwu, and the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Maikanti Baro over irregularities discovered in the foreign exchange  to oil marketers.

Baro alongside top management staff of  NNPC and it’s affiliates companies are expected to appear before the ad-hoc committee of the House investigating petroleum  pump price today.

The committee resolved to summon Emefiele and others so as to explain the intermediary role played by the CBN in the sale of forex to oil marketers, as well as to justify the rationale behind the role of the IOCs to engage in trading of legal tender.

The committee during its investigative hearing yesterday discovered that out of the total sum of $34.941 billion worth of foreign exchange sold by CBN, the sum of $10 billion was sold to oil marketers for the importation of petroleum products between 2015 and January 2017.

Chairman of the committee, Hon. Rapheal  Nnana Igbokwe, who requested for list of beneficiaries of forex sold between January 2015 to date and the banks through which the forex pass through, also demanded  legal framework which authorised the International Oil Companies to operate as financial institutions to sell forex to petroleum organisations and individuals as well as CBN.

The CBN is also expected to produce criteria for eligibility to obtain forex and all necessary records to support the transactions and sales to the organisations.

Director of Financial Market Department  at CBN, Mr. Alvan Ikoku had disclosed to the committee that the apex bank had an agreement with the International Oil Companies to sell forex directly to oil marketers between June and November 2016.

He also noted that the apex bank resolved to buy forex directly from the IOCs since the oil marketers could not afford it, and  it was no longer economical for the oil marketers to buy because of the hike in the price of crude oil.

He added  that the arrangement had stopped formally.

Ikoku who confirmed that the apex bank sold forex directly to deposit banks who later distribute to oil marketers, noted that most of the fraud and malpractices are committed at the point of forex collection.

He explained that the IOCs now sell directly to CBN which in return distribute to the oil marketers at between N304.50/$1 and N305/$1 at inter-bank rate and one percent commission.

Ikoku also argued that “foreign exchange can be traded under certain circumstances,” however noted that there was need for him to consult with the CBN Legal Department to clarify the issue.

He maintained that there CBN’s Financial Market Department was not fully informed of the transactions, “we are just being informed.”

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