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BY NKECHI NAECHE–-Citibank Nigeria Limited (Citi) on Wednesday said it has responded to the Central Bank of Nigeria (CBN) in relation to sanctions imposed on it on alleged breaches of foreign exchange regulations regarding remittances done on behalf of a customer, MTN Nigeria Communications Limited
According to statement released by the bank’s Country Public Affairs Officer Nigeria and Ghana, Lola Oyeka, said that “Citibank Nigeria Limited (Citi) recently received a letter from the Central Bank of Nigeria (CBN) imposing sanctions on Citi for alleged breaches of foreign exchange regulations in respect of foreign exchange remittances done on behalf of a customer, MTN Nigeria Communications Limited. Citibank Nigeria Limited has sent a detailed response to the CBN addressing the serious allegations made in the CBN letter.
The statement added that “Citibank Nigeria Limited remains committed to complying with all extant foreign exchange rules and regulations of the Federal Republic of Nigeria.”
CBN had last week imposed heavy fines totalling N5.87bn on four banks under its regulatory purview for alleged illegal funds repatriation.
The four banks that came under the sledge hammer of the CBN for the violations are Standard Chartered Bank, Stanbic-IBTC, Citibank and Diamond Bank.
Figures obtained from the CBN indicated that the highest fine of N2.47bn was slammed on Standard Chartered Bank, while Stanbic IBTC Nigeria was fined N1.885bn.
Citibank Nigeria was penalised to the tune of N1.265bn, just as Diamond Bank was directed to pay N250m for violating extant rules.
According to CBN investigations revealed that the sum of $3.448bn was repatriated by Standard Chartered Bank on the basis of the illegally issued CCIs.
Similarly, the sums of $2.632bn, $1.766bn and $348.914m were repatriated by Stanbic IBTC Nigeria, Citibank Nigeria and Diamond Bank Plc, respectively between 2007 and 2015.
CBN’s letter to CitiBank this reads: “Our investigation also revealed the following, among others:
i. The shareholders of MTN Nigeria Communications Limited invested the sum of $402,590,261.03 in the company from 2001 to 2006;
ii. The investment was carried out through the inflow of foreign currency cash transfer and equipment importation evidenced by the CCIs issued by your bank, Standard Chartered Bank and Diamond Bank;
iii. The CCIs issued by your bank along with the other banks in respect of the $402,590,261.03 showed that $59,436,923.44 was recorded/invested as shareholders’ loan and $343,153,339.56 as equity at the time of the investment. This position was, however, contrary to the position in the financial statements of MTN Nigeria Communications Limited for the year ended December 31, 2007, which showed that $399,594,146.00 was invested as shareholders’ loan and $2,996,117.00 as equity investment, in accordance with the shareholder’s agreement but contrary to the CCIs issued by your bank, Standard Chartered Bank (SCB) and Diamond Bank (DB). Your action in this regard constituted a rendition of false returns to the Central Bank of Nigeria…
“Your bank failed to comply with extant regulations on the issuance of letter of indemnity to the CBN in addition to forwarding the transaction history of the CCIs to the CBN, as provided in Memorandum 24(5)(ii)(b) of the Foreign Exchange Manual in respect of the CCIs received by your bank from Standard Chartered Bank.”
