TheNewsGuru

Tag: BDC

  • BDC: CBN mandates sellers above $10,000 to declare sources

    BDC: CBN mandates sellers above $10,000 to declare sources

    The Central Bank of Nigeria (CBN) has mandated foreign exchange sellers to Bureau De Change (BDC) of the equivalent of 10,000 dollars and above to declare their forex sources.

    Haruna Mustapha, Director, Financial Policy and Regulation Department of the CBN, said this in a revised regulatory framework to curtail excesses of BDCs and check uncertainty in the foreign exchange market.

    Mustapha said that such sellers would also be required to comply with all Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) regulations.

    He said that the guidelines would significantly enhance the regulatory framework for the operations of BDCs as part of ongoing reforms of the Nigerian foreign exchange market.

    According to him, the guidelines revises the permissible activities, licensing requirements, corporate governance and AML/CFT provisions for BDCs.

    “It also sets out new record-keeping and reporting requirements, among others,” he said.

    The guidelines also specify that no person shall carry on the business of BDC in Nigeria except with the prior authorisation of the CBN.

    It described BDC as a company licensed by the CBN to carry on only retail foreign exchange
    business in Nigeria.

    It banned commercial, merchant, non-interest and payment service banks, other Financial Institutions (OFIs), including holding companies and payment service providers from promoting BDCs.

    It also precluded serving staff of financial services regulatory and supervisory agencies, serving staff of regulated financial services providers, governments at all levels, among others, from promoting BDCs.

    The guidelines permitted BDCs to acquire foreign currency from authorised sources like tourists, returnees from the diaspora and expatriates with foreign exchange inflows from work, travel, investment or their domiciliary accounts.

    Other permissible sources are International Money Transfer Operators (IMTOs), embassies, hotels that are authorised buyers of foreign currencies, the Nigerian Foreign Exchange Market (NFEM) and any other source that the CBN may specify.

    It warned the BDCs not to engage in street-trading, maintaining any type of account for any member of the public, or accepting any asset for safe keeping/custody.

    It said that the BDCs were also not permitted to take deposits from or grant loans to members of the public in any currency and in any form.

    “Retail sale of foreign currencies to non-individuals, except for BTA, international outward transfers, engaging in off-shore business or maintaining foreign correspondent relationship with any foreign establishment are also not permissible,” it said.

  • How to ensure stability of Naira – BDC operator

    How to ensure stability of Naira – BDC operator

    The Managing Director, 313 Bureau de Change, Alhaji Murtala Bashir, has emphasised the need for collective efforts to ensure the stability of the naira at the Foreign Exchange Market in Nigeria.

    Bashir, who made the call in a statement on Friday in Abuja, said the Federal government and the Central Bank of Nigeria (CBN) should as matter of urgency constitute a strong committee to monitor and ensure the stability of the naira against the dollar at the Forex market.

    He said the committee should include representatives of the Federal government, CBN, commercial banks, business men, bureau de change, EFCC and other security agencies.

    According to him, the committee should be saddled with the responsibility of monitoring the Forex market and at the same advise the government on any problem observed and come up with solution.

    Bashir also commended the CBN on its efforts toward stabilising the naira at forex market.

    He added that restoring transparency and engendering investors’ confidence were the next steps to take if Nigeria must unlock dollar flows needed to support the naira.

  • BDC operators ask FG to stop Binance operations in Nigeria

    BDC operators ask FG to stop Binance operations in Nigeria

    Bureau De Change (BDC) operators in Nigeria have advised the Federal Government to use everything within its powers to stop the operation of Binance in the country.

    TheNewsGuru.com (TNG) reports the Association of Bureaux De Change Operators of Nigeria (ABCON) gave the advice in an interview on Tuesday in Lagos State.

    Binance is an online exchange, where users can trade cryptocurrencies. It supports hundreds of the most commonly traded cryptocurrencies.

    Speaking in the interview, Alhaji Aminu Gwadabe, President of ABCON averred that Binance is one of the many factors putting pressure on the naira.

    Recall that the Securities and Exchange Commission (SEC) of Nigeria had in June, issued a statement,  emphasising that Binance Nigeria was not registered or regulated by SEC, making its operations in Nigeria illegal.

    Gwadabe said, “If you know about Binance, you will know that Binance trading is becoming the anchorage of both the investors and exporters window and the parallel market, which is unfortunate.

    “So, we have to do something that can stop  Binance. It’s a competition; we need to ban Binance and the only way to do so is if you have liquidity.

    “As I speak, Binance is the most liquid market; they do 1.2 million transactions per second. So it’s a very liquid market but that is not a scary status, we can break it through our local content and peculiarities.”

    The ABCON president noted that optimism was giving way to pessimism in the present foreign exchange market situation.

    Gwadabe said that when pessimism overrode the psychology of the market, it would lead to loss of confidence by citizens, saying that was key in every currency of every nation.

    “So we are seeing a scenario where optimism is giving way to pessimism; investors are not coming, Nigerians don’t have confidence in the market and we have to look for external finances that are coming in as a quick fix.

    “There is a lot of pressure on the naira, from foreign exchange hoarding by the banks and oil companies.

    ”Is it Nigerians that want to pay school fees, round tripping, speculations, among others. All these galvanised to put pressure on the naira.

    “Spike and volatility did not start now, it’s something the present government inherited and has gone a long way in checkmating illegal behaviours around foreign exchange market and that is the objective of the unification,” he said.

    Gwadabe expressed hope that with petrol subsidy removal, the Central Bank of Nigeria would be able to see remittances from the Nigerian National Petroleum Corporation (NNPC) saying when subsidy began, the remittance to CBN from NNPC was zero.

    This, he said, would also allow the apex bank to have liquidity and inflows that would come in for them to be able to defend the naira.

    He said If we have a friendly, competitive and transparent system, more investors would want to come to the market.

    ”So, for us to succeed,  there must be liquidity. Countries that adopt floating exchange are countries that have heavy reserve and balance of payment to fallback on,” he said.

    The ABCON president urged  the National Assembly to come up with legislation that would protect investors in the market.

    “So, we need legislation now that the market is in tiers so that everybody will follow the law, know his obligation and be protected under the law. Once you meet up with your obligation, you are good to go,” he said.

    On revocation of licences of 2,698 BDCs by CBN, Gwadabe discredited the report saying, “as far as I’m concerned that list was not correct and still not confirmed.

    “The CBN has yet to come out with their comprehensive list. Yes, CBN is reviewing the BDC register with a view to reducing the number but as of now, there is no official list that proscribes or says these are the licensed or unlicensed.

    “So the statuesque remains the same,” he said.”

    The ABCON president said the association had engaged with CBN and had been advised to sensitise its members to know the conditions guiding their operations and their obligations which was to render returns to CBN.

    “We have a different department in CBN that supervises us that we need to be updating our records with them in terms of returns, change of address, change of directors and other issues involving technicality to render returns.

    “So, these are the things that we have appealed to CBN and because of our low business and no activity, a lot of our members have closed shop but that is not an excuse.

    “Nevertheless, the CBN has listened to our difficulty and has given us some months to go and work on these and improve on our returns,’’ he said.

    The CBN had in July, reduced the number of BDC dealers from 5,689 previously approved in 2022 to 2,991.

    The document titled ‘Approved BDCs’ revealed that the licences of 2,698 BDCs had been revoked.

  • Why we are going after BDC operators across Nigeria – EFCC

    Why we are going after BDC operators across Nigeria – EFCC

    The recent arrest of some Bureau De Change operators across the country especially in Lagos and Abuja by the Economic and Financial Crimes Commission (EFCC) is incidental to the Commission’s overall efforts in sanitizing the foreign exchange sector.

    TheNewsGuru.com (TNG) reports EFCC’s Director of Operations, Abdulkarim Chukkol stated this on Monday, November 14, 2022 while fielding questions on Good Morning Nigeria, a breakfast programme on the Network Service of the Nigeria Television Authority (NTA).

    Chukkol who represented the Executive Chairman, Abdulrasheed Bawa, was among eminent personalities invited to discuss the topic ‘’Sanitizing Ungoverned Operators in the Forex Sector”.

    According to him, EFCC’s arrest of BDC operators and currency speculators in the parallel market was not indiscriminate but a product of intelligence.

    “At EFCC, we work with intelligence and with other stakeholders; and when we talk of illegal forex operators you cannot just invite people on the street even though sometimes you could, but generally you do not have a choice but to make arrest”.

    He stressed that the Commission considers foreign exchange malpractice as an economic crime against the Nigerian state, adding that the Commission as far back as 2016 established a full-fledge Section known as Foreign Exchange Malpractices Section and for over ten years maintained visible “presence at all airports in the country to checkmate incidences of bulk cash movement outside Nigeria which is another aspect of this menace.”

    Through the Commission’s presence at the major gateway into the country, many arrests of cash smugglers have been made and humungous sums in foreign currencies recovered.

    “Some were arrested with excess of $6 Million (Six Million United States Dollars), others with $2 Million (Two Million United States Dollars) and we know that these huge sums were not meant to be used in buying goods but stolen monies being laundered out of the country,” he said

    Chukkol further stated that EFCC not only recovered some of these monies, but secured their forfeiture to the federal government, while the culprits were prosecuted.

    He emphasized the need for active inter-agency and stakeholder’s collaboration, pointing out that many of the over 6,000 registered BDCs do not belong to the Association of Bureau De Change Operators of Nigeria and therefore out of the orbit of regulators.

    “The CBN guidelines are clear regarding returns by BDCs, but how many of them do this,” he asked.

    Other discussants in the programme which includes Director of Monitoring Policy Department of Central Bank of Nigeria, CBN Dr. Hassan Mahmud, President, Association of Bureau De Change of Change Operators of Nigeria, Dr. Aminu Gwadebe, a finance and investment analyst, Niyi Akinsuji and a commentator on financial issues and Managing Director of Timeline Consult, Shuabu Idris in their respective contributions identified the issue of Nigeria being an import driven economy, lack of adequate penalty, shortage of trained manpower, and identification of what truly constitutes ‘black market’ beyond the institutional banking system as some of the problems bedeviling the fight against foreign exchange malpractice in Nigeria.

  • EFCC raids BDC operators in Abuja as Naira dips against Dollar

    EFCC raids BDC operators in Abuja as Naira dips against Dollar

    Operatives of the Economic and Financial Crimes Commission (EFCC) on Friday raided Wuse Zone 4, home to most bureaux de change (BDC) operators in Abuja, the federal capital territory (FCT).

    The raid, conducted in other locations across the country, was undertaken days after the CBN blamed currency speculators for exacerbating the crash of the Naira against the Dollar and other foreign currencies.

    An authoritative source at the commission disclosed that the raid was a product of weeks of covert operation, saying: “The idea is to dislodge currency speculators who are massively mopping up all available foreign currencies.

    “The raid was a product of weeks of surveillance where agents of the EFCC monitored the activities of most of the bureaux de change operators in the Wuse 4 axis”.

    According to the source, enough intelligence was gathered that some people with massive naira inflow had mobilised resources and are buying up available foreign currency, especially the dollar.

    “Similar operation has also been carried out at major airports in the country. It’s a nationwide co-ordinated operation and will be extended to major commercial cities of Kano, Lagos and Port Harcourt,’’ the source added.

    Efforts to get official confirmation on the raid from EFCC spokesperson, Mr Wilson Uwujaren were not successful as his phone was switched off.

  • BREAKING: FCTA demolishes shanties occupied by BDC operators in Abuja

    BREAKING: FCTA demolishes shanties occupied by BDC operators in Abuja

    The Federal Capital Territory Administration (FCTA) on Monday carried out the demolition of illegal structures and shanties occupied by operators of Bureau De Change (BDC) in the heart of Abuja city.

    TheNewsGuru.com (TNG) reports the affected structures included some shanties made of roofing sheets, sacks, and wood situated adjacent to Sheraton Hotel, where the BDC operators and other petty traders were operating their businesses.

    Mr Ikharo Attah, the Chairman of FCTA Taskforce on City Sanitation, who led the operation, explained that the exercise was a continuation of the reinvigorated efforts to rid Abuja city and its environs of environmental nuisances.

    The task force has also demolished an illegal cluster of furniture making workshops under the foot of a bridge near the Shehu Musa Yar’adua Centre.

    Attah revealed that the FCT Minister, Malam Muhammad Bello, had about a month ago visited the area.

    “During that visit, the minister was dazed by the high scale of contravention in the heart of the city, where people who deal in currencies operate recklessly.

    “Today, we came out on an operation to clear those persons who are roadside traders, owners of batchers, shanties and furniture markets under the Wuse Zone 4 Bridge.

    “We saw many bleeding points in the city, and the FCT Minister insisted that we must clear them all.

    “He even insisted that BDC operators who are operating on the roadside should not be as they should go back to their shops, and do their businesses.

    “We removed illegal attachments in the area and while we are removing street traders and hawkers, we can’t allow those who deal in currencies to remain on the road,” he said.

    He also disclosed that the FCT Minister had directed the Abuja Environmental Protection Board (AEPB) and other teams to pin down and ensure that the area was cleared.

    Attah said that in the course of the operation, the task force uncovered a stolen manhole cover, which the AEPB team would hand over to the relevant agency of the FCTA.

    Also, the Assistant Director, Monitoring and Enforcement of AEPB, Malam Kaka Bello, decried the high rate of environmental nuisance being constituted by traders and those hawking currencies in the area.

    Bello said, “the area was an eyesore, which was not acceptable and it contributes badly to the quality of the city’s environment.”

    He said that AEPB would ensure that the exercise is continuous, as its personnel would be there on a daily basis.

    According to him, “most of the offices in Zone 4 are owned by BDCs, but unfortunately some of them resolved to be trading outside, which is illegal.”

    He appealed to the members of the public, especially those who patronise BDCs to do so in their offices.

    Bello warned: “Anybody caught operating illegally would be arrested and prosecuted accordingly.”

    Bello revealed that Mobile Courts are already on standby, waiting for people, who indulged in illegal activities to be arrested and arraigned before them.

    “We want to appeal to all these people, who have turned the places into their abodes illegally to please vacate, as places like those ones are not meant for such illegalities.

    “They should take advantage of the markets within the city, where they can go and sell their wares.

    “For the Bureau De Change operators, they should please ensure that they carry out their businesses within their office premises, not on the roads’ corridors.”

    On his part, the Secretary FCTA Command and Control Centre, Peter Olumuji, said illegal activities being conducted in the area posed serious security threats to the lives and property of the residents.

  • Anxiety over Naira’s free fall, now exchanges for N525/$1 at parallel market

    Anxiety over Naira’s free fall, now exchanges for N525/$1 at parallel market

    Following the Central Bank of Nigeria’s decision to ban foreign exchange sales to Bureau De Change (BDC) operators in the country, Nigeria’s naira has continued to experience a sharp loss to the dollar.

    As of yesterday, July 28, black market dealers were selling the naira at ₦525 per dollar up from N505 to $1 on Tuesday, according to abokifx.com.

    But at the importer & exporter (I&E) window, the dollar traded for ₦411.52 per dollar.

    The current rate is the second weakest since February 2017.

    CBN governor Godwin Emefiele Tuesday said the ban was necessary because the parallel market has become a conduit for illicit forex flows and graft.

    “We are concerned that BDCs have allowed themselves to be used for graft,” Emefiele said in a live TV broadcast after the bank has retained its benchmark policy rate.

    “This measure is not punitive on anyone, but it is to ensure the CBN is able to carry out its legitimate mandate of serving all Nigerians.”

    Emefiele stated that commercial banks are mandated to immediately and transparently sell forex to customers who present the required documents, saying all banks are to immediately create dedicated tellers for the same purpose.

    While some economists have praised the CBN’s action to impose the ban, others fear that it may be forced to reverse the ban with internal and external pressures.

    Nigeria’s inflation rate in June dropped further for the second consecutive month to stand at 17.93% in May 2021 from 18.12% recorded in April 2021, according to the Consumer Price Index report released by the National Bureau of Statistics (NBS).

    According to the report, the consumer price index, (CPI) which measures the inflation rate increased by 17.93% (year-on-year) in May 2021. This is 0.19% points lower than the rate recorded in April 2021 (18.12%).

  • BREAKING: CBN bans sale of forex to BDCs

    BREAKING: CBN bans sale of forex to BDCs

    The Central Bank of Nigeria (CBN) on Monday announced immediate discontinuation of sale of Foreign Exchange (forex) to Bureau de Change (BDC) operators in the country.

    Mr Godwin Emefiele, the CBN Governor , made this announcement on Tuesday, while presenting a communique from the apex bank’s Monetary Policy Committee (MPC) meeting in Abuja.

    Emefiele said that the decision was informed by the unwholesome business practices of the BDCs, which he said had continued to put enormous pressure on the Naira.

    He said, henceforth, the apex bank would sell forex to deserving Nigerians through the commercial banks.

    ”The BDCs were regulated to sell a maximum of 5000 dollars per day, but CBN observed that they have since been flouting that regulation and selling millions of dollars per day.

    “The CBN also observed that the BDCs aid illicit financial flows and other financial crimes. The bank has thus, decided to discontinue the sale of forex to the BDCs with immediate effect.

    “We shall, henceforth, channel all forex allocation through the commercial banks,” he said.

    He urged the commercial banks to ensure that every deserving customer got their forex demand, adding that any bank found circumventing the new system would be sanctioned.

    “Once a customer presents all required documentation to purchase forex, the commercial banks should ensure they get the forex.

    “Any customer that is denied should contact the CBN on 0700385526 or through the email- cbd@cbn.gov.ng ” he said.

    Stakeholders have been calling on the CBN and its MPC to take urgent steps to halt unending depreciation of the Naira.

    Recently, a past President of the Chartered Institute of Bankers of Nigeria (CIBN), Mr Okechukwu Unegbu, urged the MPC to focus on policy decisions that would curb rising inflation and stabilise the Naira.

  • Expose 400 BDC operators funding Boko Haram-Ndume to FG

    Expose 400 BDC operators funding Boko Haram-Ndume to FG

    The Chairman, Senate Committee on Army, Senator Ali Ndume, has urged the Federal Government to expose all the over 400 Bureau De Change operators recently arrested for allegedly funding the activities of Boko Haram insurgency in the country.

    Ndume, who is representing Borno South Senatorial District in the National Assembly, made the call in an interview with journalists in Abuja on Sunday.

    TheNewsGuru recalls that the Senior Special Assistant to the President on Media and Publicity, Garba Shehu, had last month, said the Nigerian Government had detained some Bureau De Change operators who were facilitating the transfer of money to Boko Haram terrorists.

    He had said some Nigerians transferring money to the sect from the United Arab Emirates were working with the BDC operators.

    He had said, “Bureaus de change are facilitating money to terrorists. We have already worked with the UAE.

    “Convictions have been achieved of Nigerians who are transferring money to Boko Haram terrorists and this also happens domestically.

    “I tell you that by the time we finish this investigation, the shocking details will surprise many Nigerians,” Shehu had said.

    Ndume, upheld that Nigerians deserve to know what the government was doing concerning the suspects.

    He said, “The Presidency said recently that Nigerians would be shocked if it revealed the identities of those who are sponsoring the Boko Haram insurgents.

    “Can you imagine that 400 Bureau De Change operators are the people funding the Boko Haram?

    “When the BDC operators are arrested now, what will the government do with them. The presidency is already saying their case is confidential. What is confidential about it?

    “The presidency should expose the identities of all the BDC operators so far arrested and carry out their trial in public.

    “If any of them is innocent, he should be allowed to go while those found guilty must be made to face the music.

    “When I was wrongly accused, I was tried publicly and I was vindicated. The trial lasted six years in an open court. If there is any criminal act linked to anybody. No matter how highly placed, let the evidence be placed before the public, there should be no secret trial.

    “Nowadays, criminals are arrested and paraded without further action. Nobody knows what happens to the people who killed 11 soldiers in Benue State recently?

    “What happened to those who beheaded policemen in Cross River State?

    “If everyone is doing what he is supposed to do as defined by our constitution and laws, we would not have these problems. Citizens should expose suspicious movements.”

     

  • CBN Suspends Forex Sale to BDCs Indefinitely

    The Central Bank of Nigeria (CBN) has suspended the sale of foreign exchange to Bureau De Change (BDC) operators nationwide indefinitely.

    This decision followed a request made by the Association of Bureau De Change Operators of Nigeria (ABCON) to the authority to hold off on its members’ weekly bidding.

    The body had made the request to the apex bank through a correspondence titled Letter of recommendation to Declare Market Holiday on Our Weekly Bidding Pending the Reopening of Our Nation’s Borders and the Control of COVID-19.

    The Director, Trade and Exchange, CBN, Mr A.S. Jibrin in a circular on Thursday night explained that the decision was based on recommendations by association members to suspend foreign exchange sales until further notice.

    It was also noted that the operations of BDC operators across locations pose serious health risks due to gatherings.

    The circular further read, “Furthermore, the Government’s directive to restrict gatherings to not more than twenty (20) persons is aimed at reducing a person to person contact and curb the transmission of the Covid-19 virus and that means that the concentration of the BDC encashers at disbursement centres would pose health challenges.”

    ABCON had before now promised that in line with recent challenges facing the economy, it would be transparent in its trading rate and not deal an unfair hand to people who need foreign currency.

    And following the restriction placed on travel in order to curtail spread of the COVID-19 around the world, demand for foreign currency has reduced.