The Central Bank of Nigeria (CBN) has issued a firm warning to banks against the illegal diversion of newly printed naira notes to unauthorized individuals, including currency hawkers.
According to the circular, any financial institution involved will face an initial penalty of ₦150 million per offending branch.
For repeat offenders, the CBN will enforce stricter actions under the provisions of the Banking and Other Financial Institutions Act (BOFIA) 2020.
This warning was contained in a circular signed by Solaja Olayemi, the acting director of the CBN’s Currency Operations Department.
The CBN expressed serious concern over the increasing trend of freshly minted naira notes being diverted to unauthorized agents. It disrupts the efficient distribution of cash to the public.
This practice undermines the efforts to ensure that new naira notes are available to customers and the broader economy.
“In this regard, any deposit money bank or financial institution found guilty of facilitating, aiding, or abetting the diversion of mint naira notes to currency hawkers or other unscrupulous agents shall be penalized ₦150,000,000 for each offending branch.”
To curb this malpractice, the CBN announced that it will intensify monitoring measures.
- These include surprise checks at banking halls, ATMs, and locations where currency hawking is suspected.
- Additionally, the CBN will use “mystery shopping” techniques. To identify banks or branches involved in disbursing new naira notes to unauthorized individuals.
- Furthermore, the apex bank warned that banks engaged in cash hoarding, diversion, or any actions that obstruct the proper flow of currency will face severe penalties.
- It reminded financial institutions of its earlier directive issued on November 15, prioritizing ATM withdrawals for cash disbursement.
- This includes violations of the Clean Note Policy, which mandates that banks ensure clean and proper currency circulation.
The CBN also called on banks to strengthen their internal controls. Particularly in cash management at branches and during teller operations. The CBN emphasized its commitment to ensuring an efficient and transparent cash distribution system, urging all financial institutions to comply strictly with its guidelines.
