The Central Bank of Nigeria, CBN, is seeking power to criminalize possession of foreign currency for more than 30 days, without depositing it in a bank.
This is contained in a document called the ‘Working Paper’, where the apex bank is proposing new amendments to the Foreign Exchange, Monitoring and Miscellaneous Exchange Act (FEMM).
Signed in 2014, the law liberalized the foreign exchange market in the country, allowing foreign investors to import and repatriate money freely.
CBN believes this is deeply flawed, especially in the current recession Nigeria is facing.
The Working Paper has been shared to members of the Chartered Institute of Bankers of Nigeria (CIBN) and has also been uploaded to the website of the Nigerian Law Reform Commission.
According to Naira metrics, the act allows for “foreign currency purchased from the market to be repatriated without restrictions”.
The act “prohibits the seizure, forfeiture or expropriation of imported money by the government without providing exceptions.”
But CBN now wants to have powers to seize any such foreign currency if the source is questionable.
The CBN is unhappy that the law “allows foreign currency in excess of five thousand dollars imported or exported subject to declaration of statistics reason only.”
The apex bank is recommending that it be granted powers to restrict or prohibit the exportation of foreign currency when and where necessary to “protect the economy”.
The CBN also wants an amendment that allows it have the powers to “prevent monopoly and hoarding and a time limit for deposit of foreign currency in the bank”