The Central Bank of Nigeria (CBN) has issued a stern warning to commercial banks over the illegal sale of mint naira notes.
In a circular released on Friday, December 13, 2024, the CBN announced that any bank involved in the unlawful trading of new Naira notes will be fined N150 million.
This move comes after growing concerns about the rise of hawkers selling freshly minted naira notes to the public.
The CBN’s action aims to ensure that the newly issued Naira notes are available to the public in a fair and efficient manner.
The circular was signed by Mohammed Olayemi, Acting Director of the Currency Operations Department at the CBN.
According to the CBN, the illegal trade of mint notes by hawkers is disrupting the normal flow of cash to customers.
“The prevalence of illicit mint banknotes being sold by currency hawkers is disturbing,” said the CBN in the circular.
It is believed that this unlawful practice is preventing regular citizens from accessing their money in a timely and fair way.
The Central Bank stressed that it would impose heavy penalties on banks found to be aiding or enabling the illegal trade.
The fine for the first violation will be N150 million per erring branch.
The CBN made it clear that repeated violations would result in more severe penalties, including the application of stronger measures under the Banks and Other Financial Institutions Act (BOFIA) 2020.
The regulation highlights the seriousness with which the CBN is treating the matter.
The circular also emphasized that spot checks and undercover operations will be carried out across the country to catch violators.
“Periodic spot checks will be intensified at banking halls and ATMs, and mystery shopping will be conducted at known hawking spots across the country,” the CBN added.
The Central Bank expressed its disappointment over how some financial institutions had been complicit in the illegal distribution of mint notes.
Some banks, it seems, have been caught up in enabling these activities by either turning a blind eye or failing to act.
The CBN’s warning is aimed at ensuring that banks adhere to proper protocols and prevent the misuse of the Naira.
In response to this growing problem, the CBN also urged Deposit Money Banks (DMBs) to strengthen their internal controls.
The CBN wants banks to ensure their Cash Management Centres, branches, and teller operations are secure and immune to any form of exploitation by illegal agents.
The measures are designed to restore the integrity of the Naira and stop further exploitation of the new notes.
“The CBN has directed all financial institutions to put in place stronger controls to ensure that their systems are not used for illicit transactions,” the circular read.
This development comes at a time when the Nigerian public is already grappling with the scarcity of naira notes and the pressure on financial systems to meet the needs of citizens.
Many Nigerians have complained about long queues at banks and ATMs, making it harder to access physical cash.
In this atmosphere, hawkers have taken advantage of the situation, selling new Naira notes at inflated prices.
The CBN’s decision to impose such a heavy fine highlights the growing frustration with how the currency system is being handled.
It also reflects the central bank’s determination to clamp down on all forms of corruption within the banking system.
A significant part of the CBN’s role is to ensure that the currency in circulation serves the public fairly and does not end up in the hands of a few individuals exploiting the system.
For those who have been caught up in the illegal trading of new notes, the CBN’s warning should serve as a strong reminder of the consequences of such actions.
The financial penalties are intended not only to penalize those involved but also to deter others from following suit.
