How Femi Falana Fought CBN To Stop Unjustified Foreign Currency Regime

Femi Falana (SAN)
Femi Falana (SAN)

The Central Bank of Nigeria on Monday introduced a new rule that allows beneficiaries of diaspora remittance to receive their money in foreign currencies, months after court action by human rights lawyer, Femi Falana.

Before now, beneficiaries of diaspora remittance could only receive in cash the naira equivalent of the amount transferred. In addition, foreign currencies’ cash withdrawal from domiciliary accounts was restricted to only cash deposit.

Femi Falana (SAN)

Falana had in a petition dated October 21, 2019 and addressed to former acting chairman of the Economic and Financial Crimes Commission, Ibrahim Magu, asked for an investigation of banks, Western Union and MoneyGram for substituting naira for dollar remittances.

He referred to a remark by Boss Mustapha, the Secretary to the Government of the Federation at the 2019 National Diaspora Day celebration in July 2019, where the SGF was quoted as saying the remittances received from Nigerians stood at $19.6 billion, $22 billion and $25 billion in 2016, 2017 and 2018 respectively.

Falana argued that it was a contravention of the Foreign Exchange Act and the Money Laundering Act that the CBN granted banks, Western Union and MoneyGram the authority to pay beneficiaries of remittances in naira while retaining the dollar.

As a follow-up on his request for a probe, Falana, through his chambers, wrote to the CBN on February 10, 2020, demanding to know the accurate remittances for 2016, 2017 and 2018 respectively.

The request, according to the law firm, became necessary after it was discovered that the CBN had quoted a misleading figure in order to downplay the volume of money sent home by Nigerians living abroad.

For instance, in February 2019, the Nigerian government disclosed that the remittances received in the country in 2016, 2017 and 2018 were $19.6bn, $22bn and $25bn respectively.

However, the management of the Central Bank of Nigeria faulted the figures, going ahead to claim before the House of Representatives’ Committee on Diaspora that contrary to the World Bank’s report, the official financial inflow was $2.6bn for 2018.

To clear the air on the matter, Falana’s chambers in the letter to the CBN  pointed out that, “At the 2019 National Diaspora Day held at Abuja in July 2019, the Secretary to the Government of the Federation, Boss Mustapha, revealed that the remittances received by Nigeria stood at $19.6bn, $22bn and $25bn in 2016, 2017 and 2018.

“According to Mr Mustapha, the money is currently utilised as social security funds to families (school fees, feeding allowances, hospital bills and so on). Some of it is invested in housing and estate development, hospital projects, schools and commercial enterprises but are not properly documented and analysed for impact.

“Springing from the above statement from the Secretary to the Government of the Federation, we request to be furnished with the official figures of remittances received by Nigeria from the Diaspora for 2016, 2017 and 2018. Please be informed that this request is anchored on the Freedom of Information Act, 2010.”

In a response to the request on June 29, 2020, more than four months after the seven days required by law for FOI requests to be responded to, the CBN in a letter signed by its director of corporate secretariat, C.E Olonta, said it could not respond because the information sought was already on its website.

Further findings, however, revealed that even though all remittances are recorded by the CBN on a daily basis, the management has refused to disclose the real figures.

Falana then proceeded to the Federal High Court, Abuja, where his chamber instituted a court action against the CBN for its refusal to release the requested information on foreign remittances.

In a suit dated July 28, Falana requested an order of mandamus compelling the respondent (CBN) to provide the official figures as requested.

He argued that the information was needed to provide clarity on Nigeria’s foreign remittances as figures provided by some newspapers and credited to Mustapha were contradictory.

The suit reads: “The failure of the Respondent to furnish the Applicant with the details of her request is unlawful and in contravention of the provision of the Freedom of Information Act.

“That the information requested by the Applicant was never published by the Respondent on its websites claimed in the letter dated 29th June 2020.

“That a prerogative writ of mandamus can be issued or ordered by the court to secure or compel the Respondent to furnish the Applicant with the official figures of Diaspora remittances received by Nigeria for the years: 2016, 2017, and 2018 respectively under Section 20 of the Freedom of Information Act 2010.”

With the new directive by the CBN, Nigerians who receive foreign currencies through money transfer operators like Western Union or Moneygram can withdraw in dollars. 




Original Author

SaharaReporters, New York

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