E-Financial
Reps Say Banks Evade Taxes in Billions
House of Representatives Committee on Finance, probing tax remittances, tax assessments and payments by banks, has accused some Nigerian banks of inflating their operating costs to reduce their taxes.
The lawmakers said that the banks are making false declarations and distorting information in attempt to mislead or confuse the Committee as balances reported in the published audited accounts of some of them showed huge variation with the figures submitted to the committee.
Abdulmumin Jibrin, Committee chairman said that his committee found out that data submitted to the CBN in the banks’ monthly returns on the same issues were different from what they presented the Committee for investigation.
According to Jibrin Committee was not making unsubstantiated comments, as the documents submitted by the banks were analysed with capacity support from the United Kingdom’s Department for International and Development (DFID), National Assembly Budget and Research Office (NABRO) and reputable professionals in the industry in conducting the investigations.
“Preliminary findings show a poor quality of returns by the banks, discrepancies in data submitted, outright refusal to present documentary evidence, blanket violations of existing laws, self exemption from existing rules, false declaration, manipulation and distortion of information among others” Jibrin added
The Committee chairman said that “These despicable acts of gross misconduct clearly depict the unscrupulous and roguish character of some banks and their Chief Executive Officers. For the Committee on Finance, this is unacceptable.
“For instance, balances reported in the published audited accounts of some banks show huge variance with the figures submitted to the Committee. The data submitted to the CBN in their monthly returns on the same issues were found to be different from what was tendered before the Committee.
“Even more embarrassing are the inconsistencies and huge variances in some data provided in different pages of documents submitted, thus leaving the committee to conclude that many banks blatantly engage in the creative accounting technique of inflating their operating costs to reduce their exposure to taxes.
“Furthermore, some banks have also created exemption rules for themselves in total disregard for the provisions of extant tax laws, particularly violations of the stamp duty, withholding tax and VAT acts.
“Some chief executives deliberately refused to sign the templates, obviously evading presentation of the documents under oath, in line with legislative procedure. Similarly, key information and data were omitted.
“Such data include details of staff PAYE and utilities with tax implications, etc. There are also many cases of late remittances or outright failure to remit money collected on behalf of government.
“Generally, returns made so far by the banks are incomplete, as the order of presentation was contrary to the guidelines provided in the template. Clearly, this is aimed at misleading the committee.
“Documentary evidence requested was also provided in a haphazard manner.”
According to the committee Chairman, of the 21 banks under scrutiny, only six have supplied information requested, though with certain queries to answer.
On the other hand, he said against banks’ tradition of attention to details, 15 banks suddenly found it convenient to provide poor and incomplete documentation.
“It is obvious that over the years, government has lost billions of naira in fraudulent and underhand dealings corruptly designed by some banks to evade tax.
“This is in addition to being massively and callously shortchanged by banks saddled with the responsibility of collecting and remitting taxes,” he noted.
The committee chairman said it should be of concern to Nigerians that the government continues the yearly ritual of domestic borrowing to balance its budget deficit while the deposit banks continue to manipulate the situation to the detriment of the private and real sectors.
His words: “This domestic borrowing has become a bazaar for many banks, which provide such funds at outrageous interest rates and care less about the implication to the private and real sector, both of which continue to struggle to get the crumbs at a very high cost.
“Domestic borrowing by government has denied the private sector access to affordable funds to grow their businesses and in the process generate employment and create wealth.
“Yet again, some reprobate banks are involved in the criminal act of converting the huge funds in dormant accounts into profits, even with known and accessible next of kin.
“Why should they not pay their taxes in full and remit in full and promptly what they collect on behalf of government?”.
Jibrin said at the end of the investigation, the committee intends to examine various extant tax laws, introduce new clauses or make amendments where necessary to strengthen the country’s tax system and block leakages.
“Chief executives of such Banks must sign the templates and complete their outstanding checklists within 48 hours to set the stage for the last round of engagement between the Committee and the banks,” he said, adding: Between September 23 and 27, the chief executive o fficers of the banks must appear in person to defend their templates in a technical session before the committee.”
The global adoption of cryptocurrency has reached a historic milestone, with over 562 million people now owning digital assets, according to a new industry report.
This figure represents a significant increase from previous years, underscoring the growing popularity of cryptocurrencies across diverse demographics and regions.
The report, published by a leading blockchain analytics firm, attributes the growth to several key factors:
Increased Accessibility: Advancements in blockchain technology and user-friendly platforms have made it easier for individuals to buy, store, and trade cryptocurrencies.
Institutional Support: Major financial institutions have embraced digital assets, offering cryptocurrency investment products and payment solutions, thereby legitimizing the market.
Inflation Hedging: In countries experiencing economic instability and currency devaluation, cryptocurrencies have become a preferred alternative for preserving wealth.
Younger Generations: Millennials and Gen Z are leading the charge, viewing cryptocurrencies as a way to participate in decentralized finance and break away from traditional banking systems.
Regional Breakdown
The report highlights varying adoption rates across different regions:
Asia: Leading the charge with over 200 million cryptocurrency owners, driven by strong participation from countries like India, China, and Vietnam.
North America: Approximately 90 million owners, fueled by widespread institutional adoption and regulatory clarity in the United States and Canada.
Europe: Close to 80 million owners, with a focus on Bitcoin and Ethereum as popular investment assets.
Africa and Latin America: Rapid adoption in nations such as Nigeria, Argentina, and Brazil, where cryptocurrencies are seen as a hedge against hyperinflation and unstable local currencies.
Broader Implications
The rise in cryptocurrency ownership reflects shifting attitudes toward digital finance. Experts note that this growing user base enhances the utility and value of cryptocurrencies in everyday transactions and investments
“The increasing adoption of digital assets signals a new financial paradigm where individuals have greater control over their wealth,” said a senior economist from a major financial think tank.
“It also highlights the urgent need for governments and institutions to establish comprehensive regulatory frameworks.”
Challenges and Opportunities
Despite its growth, the cryptocurrency market faces challenges, including regulatory uncertainty, environmental concerns, and security issues. However, the potential for financial inclusion and innovation remains immense.
Companies and governments are responding to this trend by developing blockchain-based solutions, from decentralized finance (DeFi) platforms to central bank digital currencies (CBDCs). Additionally, crypto education initiatives are helping new users navigate the complexities of digital assets.
The Road Ahead
As cryptocurrencies become more integrated into mainstream finance, experts predict that ownership numbers will continue to rise.
Innovations in blockchain technology and increasing acceptance of digital assets in global commerce are likely to drive further growth.
The milestone of 562 million cryptocurrency owners marks a turning point in the evolution of finance.
With more people embracing the opportunities offered by digital currencies, the future of money is becoming increasingly decentralized and digital.
Securities and Exchange Commission (SEC) has reminded capital market operators (CMOs) to ensure that they renew their registration on or before January 31, 2025.
The Commission said this in a circular issued to ask the operators to begin their annual renewal of registration from January 1 to January 31, 2025.
The annual registration renewal of capital market operators aims to ensure that only fit and proper persons operate in the Nigerian capital market.
SEC in the secular stated: “This is to inform all Capital Market Operators (CMOs) and the general public that the annual renewal of registration of CMOs for the year 2025 will commence from January 1, 2025.
“All CMOs applying for renewal must include their 2025 annual subscription receipt from their respective trade groups as part of their application.
“In line with the Commission’s Rules & Regulations, all CMOs are to complete the process of renewal of registration for 2025 on or before January 31, 2025, via the renewal of registration portal, www.eportal.sec.gov.ng. For enquiries or support in completing the process, please contact [email protected]”
The Commission emphasised that CMOs without valid registration will be penalised and may be excluded from carrying out capital market activities.
The SEC had in 2021 re-introduced periodic renewal of registration by capital market operators, which was premised on the need to have a reliable data bank of all CMOs registered and active in the Nigerian capital market.
The aim was to provide updated information on operators in the Nigerian capital market for reference and other official purposes by local and foreign investors, other regulatory agencies, and the public.
The renewal was also introduced to increasingly reduce incidences of unethical practices by CMOs, such as those that may affect investors’ confidence and impact negatively on the Nigerian capital market, as well as strengthen supervision and monitoring of CMOs by the commission.
Consequently, the SEC amended its rules and reintroduced the requirement for yearly renewal of registration by all CMOs, which is carried out electronically to ensure efficiency.
National Information Technology Development Agency (NITDA) has been mandated by President Bola Tinubu to lead the implementation of the Anti-Money Laundering (AML), Combating the Financing of Terrorism (CFT) and Counter-Proliferation Financing (CPF) Data Management Platform project.
The project is aimed at removing Nigeria from the Financial Action Task Force (FATF) Grey List by 2025.
Nigeria was included in the FATF Grey List in February 2023.
NITDA is expected to build better systems to manage financial data and compliance in Nigeria in collaboration with the Nigerian Financial Intelligence Unit (NFIU).
Nigeria’s goal is to be taken off the Financial Action Task Force’s (FATF) Grey List by 2025.
During the project implementation’s first meeting, Malam Kashifu Inuwa, director-general, NITDA stated that the project will rectify the shortcomings noted in Nigeria’s Mutual Evaluation Report (MER).
According to Inuwa, FATF put Nigeria on the grey list due to seven problems, including the country’s incapacity to stop arms financing, growing cash inflows, and inadequacies in fighting money laundering.
“We had shortcomings in combating terrorism financing, anti-money laundering regime, counter-terrorism financing regime, and deficiency in our counter-proliferation financing regime.
“The main objective of building a better system is to help us with global compliance; to help Nigeria position itself as a key player in the global effort to combat financial terrorism and other crimes.
“This will help us to create visibility in Nigeria, as well as improve our global reputation and relationship in the financial market,” he said.
He claimed that by strengthening law enforcement, the economy, and investment, the project will enhance national security by enabling the tracking of illicit financial flows and the disruption of financial sector criminal networks.
Inuwa underlined Tinubu’s dedication to using innovation and technology to fight financial crime and corruption.
Nigeria deserves to be at the forefront of cutting-edge technologies, according to Rep. Stanley Adedeji, chairman of the House of Representatives Committee on ICT and Cybersecurity, who emphasised the importance of technology.
Adedeji promised that the National Assembly would see to it that projects received the money they were due.
“We are going to make sure that the right funding is put in place for this project without any doubt.
“We are also going to make sure that if there are any laws today that are going to impede or be a stumbling block to what this project stands to achieve, we have to go and amend those laws.
“If there are things that require executive orders so that we can quickly move forward, we will do whatever needs to be done,” he said.
Hajiya Hafsat Bakari, director-general, NFIU, called for more collaboration among stakeholders to sustain the gains of exiting the grey list.
According to Bakari, the grey list is not just a one-off project but a continuous project.
“The next cycle of evaluation will be done in 2027, and we do not want a situation where, after exiting the grey list, we still find ourselves in the next evaluation.
“This is why we have decided that the use of technology will give credibility to every statistic that we have, not just to our domestic stakeholders but also to our international partners.
“Everything should be done in real-time—accessible, credible, and factual; that is the project that we are doing today,” she said.
Subscribers Reject Tariff Hike, Say FG Cannot Speak for Them
Nigeria’s Electricity Exports Hit $112m amid Persistent Power Outage
Over 562m People Own Cryptocurrency Globally
SERAP Petitions Trump, Urges Recovery of Stolen Nigerian Assets, Barring Corrupt Officials from US
SEC Sets January 31 Deadline for CMOs Registration Renewals
FG Says NINs will Facilitate Cash Transfers to 18.1m People
NERC Discloses $5.7 Million Debt Owed by International Customers for Q3 2024 Electricity Supply
MTN Nigeria Renews Spectrum Lease Agreement with NTEL
A beginner’s guide to Temu: Your ultimate shopping companion
CBN, SEC Approve FCMB Group’s N147bn Rights Offer
E-Financial3 days agoFG Mandates NITDA to Remove Nigeria from FATF Grey List
Telecom3 days agoNigerians Consume N5 Trillion Worth of Data in One Year
General News3 days agoFidelity Bank Announces New Board Members to Strengthen Leadership
General News3 days agoMultiChoice Nigeria Unveils Annual Step-Up Offer for DStv and GOtv Subscribers
E-Business3 days agoUS Supreme Court Upholds Law Banning TikTok
General News3 days agoAMCON Debt Recovery: Sir Johnson, Arik, Rockson, and Ojemai Owe Over N455 Billion
News3 days agoEXIM Bank of the United States, NEXIM Bank Sign MoU to Strengthen Economic Cooperation
E-Financial3 days agoDangote Cement, FBNHoldings, Others Lift Equity Market by N53Bn