Emefiele May Be Charged To Court This Week

…To be arraigned for money laundering, round tripping * Naira falls to 6-year low

Barring any change in government’s plans, the suspended governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, will be charged to court this week.

LEADERSHIP Sunday reports that Emefiele was arrested while making his way out of Nigeria by land borders and flown into Abuja yesterday where he was kept in the custody of the Department of State Services (DSS). Security sources who spoke to LEADERSHIP yesterday, said the case against Emefiele is a simple one since he has been in running battle with the DSS over some terrorism financing for some time now.

The sources said now that President Bola Ahmed Tinubu has suspended the governor, the coast is clear for the DSS to bring him in for questioning and possible prosecution. Some of the charges that may be brought against Emefiele include  terrorism financing, fraudulent activities and involvement in economic crimes of national security dimension including mismanaging the CBN subsidiary, NISRAL and the central bank’s Anchor Borrowers Programme.

The DSS also accused Emefiele of fraud, money laundering, round tripping and conferment of financial benefits to self and others. Other corruption issues such as the “ways and means” is still hanging around the suspended governor’s head.

According to human rights activist, Sesugh Akume, under the administration of  Emefiele, the bank never followed the principles of “ways and means” loans and the loans moved from N789.6billion in May 2015 to N22.7trillion in May 2023.

In a press release by Akume in reaction to Emefiele’s suspension, he said this policy gaffe and others were responsible for “distortions in the economy, including inflation (the rising cost of goods and services) which the CBN itself admits” under Emefiele.

The activist, however, faulted the unilateral suspension of Emefiele by President Bola Tinubu without recourse to the Nigerian senate as stated in the CBN Act 2007, adding that the act “needs to be strengthened to protect the institution of the CBN from abuses, both internal and external.”

He said; “I have been opposed to the rank incompetence, maladministration, and abuses by Godwin Emefiele as CBN governor and had in the past instituted two lawsuits against him and the CBN, and others at the Federal High Court Abuja.

 “The harm Godwin Emefiele has done to Nigeria, its monetary system, the CBN as an institution, and Nigerians is incalculable, and he needs to end up in prison someday, hopefully in the near future.” The DSS had earlier in the day said Emefiele had been brought in for questioning.

That came after the initial reaction by the DSS spokesman, Dr Peter Afunanya that Emefiele was not in their custody earlier Saturday morning. But in a statement at about 2:18pm yesterday, the spokesman confirmed that he was in their custody for some investigative reasons.

Part of the DSS statement read; “The Department of State Services (DSS), hereby confirms that Mr Godwin Emefiele, the suspended governor of the Central Bank of Nigeria is now in its custody for some investigative reasons. “The public, particularly the media, is enjoined to apply utmost caution in the reportage and narratives concerning this.”

The DSS earlier in the year accused Emefiele of terrorism financing. LEADERSHIP reported that Emefiele fraternised with a well-known terror financier whose name was not disclosed. The DSS said the CBN governor was involved in the financing of terrorism and must answer for the alleged crime.

It said preliminary investigation revealed various acts of terrorism financing, fraudulent activities perpetrated by Emefiele and his involvement in economic crimes of national security dimension. In the heat of the case, the DSS had tried to arrest Emefiele but a  Federal High Court in Maitama, Federal Capital Territory (FCT), Abuja issued an order restraining it from arresting Emefiele.

This ruling, delivered by Justice M.A. Hassan also applies to the Inspector-General of Police (IGP), the Attorney-General of the Federation (AGF), the Economic and Financial Crimes Commission (EFCC), and the CBN, who are listed as defendants.

Earlier, a Federal High Court sitting in Abuja declined an application filed by the DSS to arrest and detain Emefiele over the grave allegations against him. In declining the motion ex parte filed by the secret police, Justice J. T. Tsoho, the Chief Judge, said the DSS did not provide any concrete evidence to substantiate its claims that Emefiele was involved in terrorism financing and economic crimes.

When Emefiele returned to Nigeria after spending several weeks away, military personnel and intelligence officers were deployed to ensure that he was not arrested by the DSS. The then CBN governor headed to his office after his return with massive security, specifically military protection.

Naira Falls To 6-year Low

Investors’ sentiment towards the country may be turning positive with the suspension of the Godwin Emefiele from the position of the helmsman at the Central Bank of Nigeria (CBN), as analysts say they expect a turn towards the policies of the new administration.

President Bola Ahmed Tinubu’s government had on Friday announced the suspension of the CBN governor to allow for investigations into policies by the apex bank, leaving the deputy governor, Operation, Folashodun Shonubi in charge of the CBN.

However, the naira on Friday fell to N472.50, against the dollar, lowest ever recorded at the Investors and Exporters (I&E) since it was created in 2017. This represents 0.63 per cent (N3) when compared to N469.50/$1 quoted on Thursday at the official foreign exchange market.

Speaking with LEADERSHIP, the head, Financial Institutions Ratings at Agusto& Co, Ayokunle Olubunmi, noted that while the removal of Emefiele from the top job at the CBN could be described as temporary, it signals the willingness of the new administration to follow through with the policy direction in the inaugural speech of the president.

Tinubu in his inaugural speech had stressed the need to harmonise foreign exchange in the country as well as cut interest rate in the country. These are contrary to the stance of the CBN under Emefiele as the Monetary Policy Committee had at its last meeting raised benchmark interest rate to 18.5 per cent maintaining its stance that it will continue to tighten monetary policy as inflation rises. The CBN has also defended its decision to continue to defend the naira leading to the spread of over N230 between the offical and parallel market rates.

Olubunmi noted that “some investors will be neutral until a replacement is announced. In Nigeria at times, we feel something is bad, but will move to a worse position. “Some will see it as positive with the expectation that the President will appoint someone that can implement his plan. Recall that the President said all the right things about monetary policy in his inauguration speech.

 “We can only hope for the best. I doubt if it will give any negative vibe to investors. Recall that he was also suspended and not sacked. The court has also established that the President has the power to suspend the CBN governor.” Meanwhile, most currency traders who participated at the foreign exchange auction on Friday maintained bids between N460/$1, lower and N477.00/$1, higher bid.

Traders at the parallel market, popularly called black market, were confused on Saturday and could not establish any rate because of the suspension of Nigeria’s Central Bank governor. President Bola Ahmed Tinubu, on Friday suspended Godwin Emefiele, governor of the Central Bank of Nigeria (CBN) following the ongoing investigation of his office and the planned reforms in the financial sector of the economy.

 “There is no rate today. People are not buying because they said the rate might go down as the CBN governor has been suspended. I was even begging one of my customers to buy at N750, he refused, ” one trader told BusinessDay. At the close of business on Friday naira closed at the rate of N760 per dollar, stronger than N765 traded during the intraday trading of that same day.

Tinubu had in his inaugural speech on May 29, 2023 signaled plans for a single exchange rate. He said monetary policy needs thorough house cleaning and that the Central Bank must work towards a unified exchange rate.

This will direct funds away from arbitrage into meaningful investment in the plant, equipment and jobs that power the real economy. Brent crude oil price extended its prior week’s decline, down 0.3 percent week-on-week (w/w) to settle at $75.89/bbl. On the domestic front, Nigeria’s foreign reserves declined mildly by 60bps w/w to $34.9ban as of June 7, 2023, a report by Afrinvest Securities Limited noted.

 “We expect the naira to trade relatively around the N470 band across the official market segment barring any market distortion and current market information driving demand. Also, as the CBN continues its weekly FX market intervention to defend the value of the naira at the retail FX auction and secondary windows, we anticipate movement in rates in tandem with market realities,” analysts at Cowry Asset Management Limited said.