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Tag: deposits

  • Banks reject deposits from Politically Exposed Persons

    Banks reject deposits from Politically Exposed Persons

    Many commercial banks no longer accept deposits from Politically Exposed Persons (PEPs), it was leant yesterday.

    A PEP, who is entrusted with a prominent public function, generally presents a higher risk for potential involvement in bribery and corruption by virtue of his position and the influence that he may hold.

    Banks’ stoppage of taking hard-sought deposits from PEPs followed the rising regulatory surveillance and high risks involved with such transactions. Lenders had, in many cases, suffered huge monetary losses whenever illicit funds are traced to them.

    The Group Chief Conduct and Compliance Officer of Access Bank Plc and President, Compliance Institute of Nigeria (CIN), Pattison Boleigha, who confirmed the development during a meeting with reporters in Lagos, said banks, had adopted global best practices against money laundering and corruption.

    “We have placed ourselves on the pedestal of compliance. If you want to do business with international community today, you must ensure you are compliant in fighting corruption and money laundering. Each bank operates a defined structure. So, when these foreign investors come to Nigeria, they know the structure each bank has put in place,” he said.

    “We want to ensure that foreign investors realise that when they come to Nigeria, it is a very good ground for professionalism. When they do that, they have the assurance that when they do business in Nigeria, they are dealing with credible organisations.”

    Also speaking, a Bank Examiner with the Central Bank of Nigeria (CBN), Buhari Isa, said many banks mortgage compliance issues by setting unrealistic targets for their staff .

    He said there was need to look at why bank staff bring in bad deposits into lenders’ vaults. “For example, we are talking about integrity. If you see someone that does not have integrity, there is nothing you can do about it. But you can make sure there are controls that discourage such behaviours in an organisation. For example, you can conduct research on how some staff, connive with high net-worth individuals to bring in deposits without carrying out due diligence,” he said.

    Isa, who is also the  Vice President of CIN, said a bank staff will provide reasons why he is conniving with a PEP to bring in huge deposits. That, he said, may arise from the bank’s dysfunctional policy.

    “For example, you set unrealistic target for bank staff insisting that within the next one week such staff should bring N1 billion deposit. A PEP who collected bribe of N100 million comes to the bank staff, such target will make the staff to quickly take the money without doing proper Know Your Customer for the depositor,” he said.

    In Isa’s view, addressing the high deposit target set for bank staff will help boost compliance.

    Boleigha disagreed. The Access Bank Group Chief Compliance Officer spoke of the challenges faced by lenders. He said that banks do not commit crime but the people within the bank commit crime.

    “The targets were not set so that people will go and commit crimes. Unfortunately, whether you like it or not, financial institutions will receive good money, and they will also receive bad money. There is really nothing you can do about it because that’s where the money should pass through. In fact, if this bad money is not kept in the banks, it will be more difficult for government authorities to track  people that are committing these crimes,” he said.

    To Boleigha, it is good to have all Nigerian financial transactions pass through the financial system so as to have financial record of all bad monies. He said that although bank staff have targets, that should not stop them from complying with set rules. “So, if you know that you are bringing a customer that is high risk, of course you should know, the first thing to do is to conduct a risk assessment of the customer.

    There are some banks that even said they will not bank PEPs. So, if you decide you are going to bank PEPs, you must have risk management structure that will enable you manage those PEPs,” he said.

    “And those risk management structures are crafted from the rules and regulations of the CBN. There are CBN’s guidelines on how to manage PEPs. If you follow the rules, it means that when bad money comes, account officers of the banks should be able to know that it is bad money.

  • Barclays Bank sets limit to expatriates’ minimum deposits

    Barclays Bank has asked expatriates, including Nigerians, with less than £100,000 deposit to close their accounts.

    In a letter dated June 12, 2017, the bank informed the customers that would be affected by the policy of its decision to raise the minimum client balance requirement for international banking service.

    “The new minimum level will now be £100,000. Top up your savings and investments to £100,000 or more before 1 August 2017, to continue with the service, or close your account and transfer your monies to another provider without charge,” the letter read.

    “We understand that you may be disappointed by this and we will aim to offer you as much assistance as possible during this transition period.”

    As far back as 2013, the bank announced that it would focus on 70 countries globally and customers in those that are not considered as core as others.

    In recent times, high-security measures have made it more difficult for foreigners to open accounts with high street banks in the UK.

    Revelations made in the Panama Papers leak, which showed how Panamanian law firm, Mossack Fonseca, helped clients evade tax through the use of offshore accounts and various cases of money laundering have also contributed to this.

    The London-based bank had posted a net loss in the second quarter of 2017 and reduced its stake in Barclays Africa Group to 15 per cent from 51 per cent through a share sale, which allowed the firm to free up capital.

    The bank did not disclose how many people will be affected by the new regulation.

  • EFCC probes N4b deposits in ex-minister’s account

    EFCC probes N4b deposits in ex-minister’s account

    Agency to retrieve $400,000 paid in bid to change poll’s results

    Economic and Financial Crimes Commission (EFCC) investigators have discovered that about N4billion was channeled through the account which former Finance Minister Mrs. Nenadi Usman operated for  campaign funds purposes, it was learnt at the weekend.

    The account is titled “Joint Trust Dimension Nigeria Limited”. A substantial part of the funds was disbursed to Peoples Democratic Party (PDP) chieftains ahead of last year’s general elections.

    Mrs Usman, who has been detained since last Thursday,  is being interrogated by operatives of the anti-graft agency in Lagos.

    An EFCC source said: “Mrs Usman was asked to report in our Lagos office so as to be able to secure a remand warrant which will assist us to interact with her.

    “There are many issues which she ought to respond to but there is a subsisting directive given to FCT courts to stop granting remand warrant to EFCC. If the anti-graft agency does not detain for  a while, the ongoing investigation will be disrupted.

    “The EFCC is not after perpetual detention but it needs time to dig into facts available to it. For instance, the account provided by Nenadi Usman had over N4billion from different depositors, including individuals and organisations.  The list of those who made funds available ought to be screened by the EFCC.”

    On the fate of Mr. Azibaola Roberts (former President Goodluck Jonathan’s cousin) who has been detained over $40million(N12.7b) obtained from the Office of the National Security Adviser(ONSA), the source said: “He was also moved to Lagos to be able to complete ongoing investigation.”

    “You know he was arrested in respect of payment of $40million by ONSA for a contract which was tagged as purchase of tactical equipment for Special Forces.

    “But the cash was actually disbursed by ONSA to pacify militants in the Niger Delta.”

    The EFCC is investigating a former Minister for allegedly collecting $400,000 (over N120million) from the Office of the National Security Adviser(ONSA) to alter the results of the presidential election from Yobe, Borno, Bauchi, Adamawa, Gombe and Kano. The cash is believed to have been allocated to bribe election officials.l

    But the ex-minister diverted the cash into personal commitments instead of using it to bribe officials of the Independent National Electoral Commission (INEC) to falsify the results.

    All attempts by the administration of former President Goodluck Jonathan to retrieve the money from the former minister before the May 29, 2015 handover date failed.

    The ex-minister is believed to have obtained the over N120million from ONSA without any “justifiable” purpose.

    The former minister was said to have been jittery on March 29, last year on the outcome of the presidential election. She rushed down to the Presidential Villa for what she regarded as an “urgent electoral rescue matter.”

    It was learnt that she demanded for the $400,000 (over N120million) from the Presidency to bribe electoral officers in the Northeast and Northwest to “alter the presidential poll’s results in favour of ex-President Goodluck Jonathan”.

    Although some top Presidency officials had reservations on the agenda of the ex-Minister because of the ethical disposition of ex-INEC chairman Prof. Atahiru Jega, she secured the cash from ONSA.

    It was gathered that she told the Presidency that she had done a good homework which will lead to the alteration of results from the Northeast and Northwest.

    Investigators believe the ex-minister diverted the cash to personal use.

    When it was obvious she was only being smart, Jonathan telephoned the then All Progressives Congress (APC) candidate Muhammadu Buhari on March 31, last year to accept defeat.

    A source said: “The more we dig into the mismanagement of the $2.1billion arms deals, the more fresh facts are revealed. You can see an individual collecting N120million to bribe INEC officers.

    “Moves by the government of Jonathan to retrieve the cash from the ex-minister before the handover date failed. When the pressure was much, she said she had used it to assist a governorship candidate in the APC who was in need.

    “Besides the N120million, the ex-minister was also involved in the misuse of public funds for campaign. She is being investigated by the EFCC.

    “But she has to cough out this N120million before we move into how public funds were diverted to campaign.”

    About a fortnight ago, the EFCC arrested the Resident Electoral Commissioner (REC) of the Independent National Electoral Commission( INEC) in Cross River State, Gesila Khan and four others over a N650.9million 2015 bribery.

    The other suspects  and the cash against their names are Fidelia Omoile (Electoral Officer in Isoko-South Local Government Area of Delta State)—N112,480,000 ;

    Uluochi Obi Brown (INEC’s Administrative Secretary in Delta State)—N111,500,000; a former Deputy Director  of INEC in Cross River State, Edem Okon Effanga—N241,127,000 and the Head of Voter Education in INEC in Akwa Ibom, Immaculata Asuquo—N214,127,000.

    Materials for the presidential and senatorial polls were retrieved from the home of some of the suspects.

    EFCC operatives recovered also many documents on financial and landed properties from the suspects.

    Some of the documents include receipts of payments made into their accounts.

    The suspects allegedly committed the fraud in Rivers, Akwa Ibom and Cross River states.

    There were indications that many INEC staff and ad hoc workers got bribe.

  • CBN to refund mandatory caution deposits to all BDCs

    CBN to refund mandatory caution deposits to all BDCs

    The Central Bank of Nigeria (CBN) Friday opted to refund the N35 million Mandatory Caution Deposits to the Bureaux De Changes (BDCs) as part of the strategy to curb the excesses of the BDCs  and stop the free fall of the Naira

    But the apex bank will retain the N1 million licensing fee collected from the BDCs.

    The  CBN in a circular  signed by Mr Kevin N Amugo, Director, Financial Policy and Regulation Department said:  “given the recent development in the operations of BDCs in the economy, the CBN has decided as follows: The refund of mandatory caution deposit of N35 million to all BDC operators and the retention of N1 million licensing fee.”

    The CBN asked all eligible BDCs “to apply for refund of their caution deposits, attaching evidence of payment and bank transfer details.”

    What this means is that patrons of BDCs from now on will be at the mercy of the operators and where there is an infraction, the CBN may not step in to intervene on behalf of the customers.

    On January 11, CBN governor Godwin Emefiele while rolling out new forex policies had lamented that “it is almost impossible for the CBN to monitor over 2700 BDCs with its limited number of examiners.

    “It is almost practically impossible and because of inadequate foreign exchange, the BDCs have to source their foreign exchange autonomously. We do not have the resources to cope with over 2,000 BDCs in the country right now.

    “BDCs not happy with this decision are free to return their license and get a refund of the N35 million cautionary fees besides we need more people to go into other forms of businesses like agriculture where we believe there is a lot of scope at this time.”

    Emefiele said that stakeholders in some of the subsectors “have not been helpful in this direction. In particular, we have noted with grave concern that Bureaux De Change (BDC) operators have abandoned the original objective of their establishment, which was to serve retail end users who need US$5,000 or less. Instead, they have become wholesale dealers in foreign exchange to the tune of millions of dollars per transaction. Thereafter, they use fake documentations like passport numbers, BVNs, boarding passes, and flight tickets to render weekly returns to the CBN.”

    Emefiele noted that “despite the fact that Nigeria is the only country in the world where the Central Bank sells dollars directly to BDCs, operators in this segment have not reciprocated the Bank’s gesture to help maintain stability in the market.”

    According to him, “whereas the CBN has continued to sell US Dollars at about N197 per dollar to these operators, they have in turned become greedy in their sales to ordinary Nigerians, with selling rates of as high as N250 per dollar.”

    Given this rent-seeking behaviour, Emefiele said “it is not surprising that since the CBN began to sell foreign exchange to BDCs, the number of operators have risen from a mere 74 in 2005 to 2,786 BDCs today. In addition, the CBN receives close to 150 new applications for BDC licenses every month.”

    The CBN, he said, noted  the following unintended outcomes: Avalanche of rent-seeking operators only interested in widening margins and profits from the foreign exchange market, regardless of prevailing official and interbank rates; Potential financing of unauthorized transactions with foreign exchange procured from the CBN; Gradual dollarization of the Nigerian economy with attendant adverse consequences on the conduct of monetary policy and subtle subversion of cashless policy initiative; and Prevailing ownership of several BDCs by the same promoters in order to illegally buy foreign currencies multiple times from the CBN.

    More disturbing to the CBN the governor said was the financial burden being placed on the Bank and the country’s limited foreign exchange.

    The CBN, Emefiele explained, “sells US$60,000 to each BDC per week. This amount translates to US$167 million per week, and about US$8.6 billion per year. In order to curtail this reserve depletion, we have reduced the amount of weekly sales to US$10,000 per BDC, which translates into US$28.4 million depletion of the foreign reserve per week and US$1.476 billion per annum.”

     

  • Nsukka residents seek exploration of gas, crude deposits

    Nsukka residents seek exploration of gas, crude deposits

    A natural gas and oil well discovered about 50 years ago at Ehalumona in Nsukka Local Government Area of Enugu State has remained untapped since its discovery.

    The residents have expressed the desire to see exploration activities at the site.

    The natural gas and oil deposit in the area is said to be in large commercial quantity and estimated to last for over 50 years.

    An indigenous oil and gas company, Seveen Energy was said to have acquired the site for exploration but abandoned it for what insiders called political interference.

    The vast gas site was first discovered by CGG Company prior to the Nigerian Civil War in 1966. It has been overgrown with weeds and left in a deplorable state.

    The untapped crude deposit found in abundance in the area has traces of the same deposits in other communities in Nsukka and also cut across local governments in the area.

    The areas that have traces of the crude deposits include Obollo Ekeh, Ezebinagu, Isi Uzo, amomg others.

    The major base of the oil is in Ehalumona and it has about 30% petrol and 70% natural gas deposits.

    The residents of the oil rich communities   have expressed worry over the inability of the indigenous company, Seveen Energy to carry on further explorative activities since the Federal Government awarded it since 2013.

    The residents dislosed that the Seveen Energy company had carried out a siesmic operation they termed environmental impact assessment in February 2014 at the abandoned oil zone.

    In  2008 the huge natural gas deposit attracted Geokinetic Gas and Oil Plc, for further exploration of the site but failed to continue.

    A community leader, Cletus Akor disclosed that prior to the Nigerian civil war in 1966, the oil and gas deposits had earlier attracted CGG company where they carried it’s first seismic exploration but couldn’t continue as a result of the severity of the civil war.

    The community youth leader, Oji Uzo expressed his dissatisfaction over the abandoned oil-rich zone, describing it as a waste of both human and capital resources.

    He said: “This type of thing should not be joked with. Look at an endowment being overlooked, something that would have been a source of employment opportunities for jobless Nigerian youths is overgrown by grasses. When this company first came here, our youth were employed as labourers and some worked in other lucrative positions, but look at how delapidated it is, a treasure of a nation.

    “They told us that they would test the natural gas which they did and carried a half tanker of the crude gas for test, but we have not heard from them again.”

    Also, Mr. Jonathan Ugwuanyi disclosed that apart from the Natural gas located in the area that there are untapped natural resources like Gold, Coal, among other resources located in the area.

    The traditional ruler of Ezebinagu /Ehandiagu communities,  Igwe Daniel Ugwuanyi expressed his belief that the company may begin exploration of the natural gas soon.

    He said: “If this gas deposit is explored, it will create job opportunities for the people as well as a source of revenue for the Federal and State government.”

    He said that the gas deposit would likely foster the construction of the much neglected Nsukka, Ehalumona, Ehandiagu, Mbu-Ikem road,” he said.

    He therefore apealed to the State and Federal government to react positively to the abandoned huge gas deposit located in Ezebinagu/ Ehandiagu communities.

     

  • Bank barred from accepting foreign currency deposits

    Bank barred from accepting foreign currency deposits

    The Central Bank of Nigeria (CBN) yesterday stopped banks from accepting foreign currency cash deposits into customers’ accounts.

    A circular to all authorised dealers and general public titled: ‘Developments in the Foreign Exchange Market- Re: Cash Deposit Into Domiciliary Accounts’ said the regulator has considered the recent statements by Deposit Money Banks (DMBs) concerning the large volume of foreign currencies in their vaults and the decision to stop accepting foreign currency cash deposits into customers’ accounts as a welcome development.

    Its Director Trade and Exchange Department, Olakanmi I. Gbadamosi who signed the circular, said the policy shift is in line with its continued efforts to stop illicit financial flows in the Nigerian banking system which aligns with the anti-money laundering stance of the Federal Government.

    He explained that for foreign currency cash lodgments made before yesterday, the account holder has the option to either withdraw his or her foreign currency cash or the naira  equivalent.

    “For the avoidance of doubt, only wire transfers to and from Domiciliary Accounts are henceforth permissible,” he said.

    The CBN urged individuals that wish to source foreign currency for eligible and legitimate purposes such as Business Travel Allowances, Personal Travel Allowances medical, mortgage, school fees, goods among others to do so through recognized channels with the use of Form ‘A’ for “invisible” and Form ‘M’ for “visible” transactions.

  • Experts to banks: Avoid desperation for deposits

    Experts to banks: Avoid desperation for deposits

    WORRIED by what it described as the ‘craze for deposits’ by some money deposit banks operating in the country, some economic and financial experts have warned that such tendencies should be discouraged as it could plunge the nation’s banking sector into further recession in no distant time.

    Giving this warning was Chief Isaac Olusola Dada, Managing Director/Chief Executive, Anchoria Investment & Securities Limited, a frontline securities and investment company in Nigeria.

    Dada who spoke at a public forum organised by the Institute of Credit Administration in Lagos, recently, said it was disheartening to note that the circumstances that led to the stock market bust in mid 2009 was already rearing its ugly head.

    According to him, “You will recall that in the build up to the stock market bust in 2009, many money deposit banks in the country in their quest for deposit were practically dangling ‘carrots’ in form of margin loans to prospective investors. I got quite a handful of such offers. But what happened at the end is better imagined that, explained.”

    The former president, Institute of Directors (IoD) and erstwhile national president, Nigerian-American Chamber of Commerce, said it is worrisome that many banks are hell-bent in getting deposits at all cost rather than concentrate more on other banking operations with less risks.

    “What is, however, worrisome is that we don’t seem to have learnt much from that sad episode because many banks are already showing similar tendencies. Banking is supposed to be conservative and should be devoid of the unprecedented level of crass materialism being flaunted by these money deposit banks,” he stressed.

    Echoing similar sentiments, Dr. Makilolo Isaac Goddey, an economist, said unless concrete steps are taken the nation’s banking sub-sector may suffer the worse kind of recession in history.

    While noting that the Assets Management Corporation of Nigeria (AMCON) was packaged to take care of the toxic assets of the distressed banks during the aftermath of the 2009 credit crunch, he lamented that. “We see the same thing replaying itself again because nothing has changed in the terrain of the banking industry.”

    Going down memory lane, Goddey recalled that back then, bankers were just pressurising businessmen to come and take margin loans.

    Raising a poser, he asked: “What do you think was driving that tendency? The answer is, of course, profitability. Today the same thing has not changed.”

    Expatiating, he said: “Two things that were driving the banking sub-sector then profitability and balance sheet size are still very paramount. Everybody’s concern is how much profit does my bank make? The more profit your bank make they use it as a marketing tool to say oh, my bank is doing very well. But that shouldn’t be the focus of banking. Banking is conservative exercise.

    “The question is, what value have you been able to add to the real sector of the economies? How much of new business have we been able to bring up and entrench within the system? From what I have observed, in the next three-four years, AMCON would have to do another work. So the question that the initial lifespan of AMCON is 10 years is not going to be. Because there are some risk assets now that would still bubble in another five years.”

  • Housing: Deposits safe, NLC assures workers

    The Nigeria Labour Congress (NLC) has assured workers and subscribers of the security of their deposits for the NLC-Kristone-Lally Housing Project in Abuja.

    In a statement, the  NLC President, Comrade Abdulwaheed Omar, said the congress is doing everything possible to protect and secure the interests of the subscribers despite  alleged of a scam in the housing project.

    Omar said: “In its bid to promote workers’ welfare, the congress went into understanding with a number of developers to provide affordable housing for workers, one of such understandings was with Kristone –Lally with whom congress signed a memorandum of understanding (MoU).

    ”Based on this MoU and subsequent advertisement, a large number of workers subscribed to the project under the MoU, Kristone-Lally was to build specified housing types at agreed prices. The funding of the project was to be provided by financiers from abroad whom Kristone-Lally had identified.”

    The President said NLC was on its part to ensure that there were off-taken of the housing units by mobilizing workers to subscribe by paying some per centage of the price of desired house type stressing that NLC was happy with the overwhelming response of Nigerian workers to the advertisement of subscription to the housing project.

    He said that on the 4th of October 2013, NLC decided that further subscription and collection of money be stopped to enable the project consolidate and deliver the first phase of houses to those who had subscribed within the agreed timeframe of December 2014, adding that the congress’ decision was served on and acknowledged by Kristone-Lally.

    Omar said: “Congress became worried as the take –off of the project kept on being delayed. Due to the delay, a number of subscribers applied for a refund of their deposits.”

    He explained that in the process of processing the application for refunds, the officials of NLC encountered a bank teller which showed that a subscriber had paid the initial deposit into an account other than the advertised NLC-Kristone-Lally EPC account.

  • NAGAFF to protest non-refund of container deposits

    The National Association of Government Approved Freight Forwarders (NAGAFF) has warned that unless urgent steps are taken to correct the anomalies being perpetuated against them, the nation risks industrial disharmony and unrest in the maritime sector.

    Its Secretary-General,Increase Uche, said the group’s grouse is the refund of container deposits to importers by shipping companies instead of paying to them who made the deposits.

    The group said it has written to the Registrar, Council for the Regulation of Freight Forwarding in Nigeria (CRFFN) of the likely implication to the nation if the issue was not sorted out soon.

    Uche said: “We have drawn the attention of the Registrar to the seeming unprofessional conduct and disregard to the relevance of freight agents whose names appeared in the register of Freight Forwarders of Nigeria by the shipping companies. It is a fact that CRFFN under Act 16 of 2007 of the National Assembly has the mandate to regulate and control the freight forwarding agents in Nigeria.

    “It is also a fact that the statutory responsibility of the Act is to protect and enhance professional conduct and practices of the members whose names appeared in the register. It is also a fact that under common contract law the freight forwarders act on behalf of the principals and that explains why non-negotiable import documents are endorsed and entrusted to registered members to act on behalf of the principal.”