Central Bank of Nigeria (CBN) said it has uncovered a new wave of economic crime where some Nigerians buy the United States Dollars in Nigeria and take them to Dubai (in the United Arab Emirates) and Saudi Arabi for sale for profit.
Sanusi Lamido Sanusi, governor of the bank, said that a careful study of the economic crime, he said, showed that the culprits are from Kano, in Nigeria’s North West.
Sanusi who spoke at the side-lines of the 2013 annual World Bank and International Monetary Fund (IMF) meetings in Washington DC, said that “from Kano who just buy dollars and go to Dubai, Saudi Arabia to trade them, he said: “If they want to trade dollars, let them go to Saudi arabia to get the dollars and not buy in the market. It is money laundering because we sold dollars to them on the condition that these dollars were to be used to purchase goods and services that are approved by ministry of finance. If they use it for any other purpose, it is money laundering.”
“We must always remember that we are a regulator in the foreign exchange market. The actions we take are not necessarily tied to what the exchange rate is, it is tied to other things. Money laundering hurts the economy, it hurts our reputation and image. When people walk out of Nigeria with $5million,,our law allows it, imagine walking into holland or France and showing a declaration that you declared it in Nigeria and you purchased it from a BDC, people will wonder what kind of country it is that feeds into all this image we are trying to protect. These are aimed at addressing money laundering.”
Continuing, the CBN said findings also showed that “people are holding dollars because they believe that the Naira is going to depreciate, or people are trying to cover an audit trail, and do some form of money laundering or like has been discovered in some cases, people are actually buying dollars and going to other countries to dominated BDC business and we have to stop that.”
The CBN Governor also said the Retail Dutch Auction System (RDAS) is to help curb speculation, and that the forex “market is really just 30 percent of total forex market, 70 percent is interbank, we have not stopped them from buying interbank. We are simply saying ‘if you want to buy from us, show us evidence that there is a demand from your customers,’ that’s all. It then stops people from buying in the hope that they can force a depreciation and then make a profit,” Sanusi stressed.