Regulators sanction 5 Nigerian banks for Forex infractions, money laundering, others: Report

*The Central Bank of Nigeria (CBN) and Securities and Exchange Commission (SEC) have sanctioned five leading commercial banks in the country for committing over 20 various infractions, including Forex market irregularities and anti-money laundering guidelines

Isola Moses | ConsumerConnect

In line with the banking and finance market regulatory rules, the Central Bank of Nigeria (CBN) and Securities and Exchange Commission (SEC) have sanctioned five major banks for committing over 20 various infractions.

ConsumerConnect gathered such irregularities include the violation of Foreign Exchange (Forex) market and anti-money laundering regulations.

The banks are Guaranty Trust Holding Company (GTCO) Plc, United Bank for Africa (UBA) Plc, Access Bank Plc, Stanbic IBTC Holdings (IBTC) Plc and Fidelity Bank Plc.

The five lenders reported a combined fine of N1.46billion, according to the half-year 2021 financial results filed with the SEC.

In accordance with extant regulatory rules, Nigerian banks are required to include sanctions and fines imposed on them by regulatory agencies in their audited financial reports to the regulators.

Among the five lenders, GTCO got the highest fine, running to over N500million.

Specifically, the CBN fined GTCO N692million for violating its rules on certain Forex transactions carried out by some betting and gaming companies, The Punch report said.

The tier-1 lender was also fined N2million for non-refund of interest on debit of non-interest-related charges imposed on non-funded accounts.

Likewise, UBA Plc also was fined the sum of N273million for only two market infractions. It was fined N260million for Forex documentation lapses in respect of some customers’ accounts.

The Nigerian banking regulator also asked the lender to pay N13million for non-verification of a customer identity and delay in filing the related transaction report

Both CBN and SEC imposed the sum of N233million on Stanbic IBTC Holdings in the period under the review, according to the filing.

The commercial bank was fined N230million for an alleged contravention of extant forex regulations from January 2013 to July 2020.

The financial institution was also fined N1million for administrative infractions in the Retirement Savings Account (RSA) transfer during the fourth quarter of 2020.

Stanbic IBTC, in its audited half-year ended June 30, 2021 results, said, “Penalty imposed by the CBN following an alleged unfair termination of employment of former employee:

“The CBN imposed a penalty of N2million on the bank following an alleged unfair termination of employment of a former employee, whose employment was terminated for being unable to meet the performance criteria required to confirm his employment in line with policy.”

Access Bank reported N189.65million fine in the period under review. The CBN imposed N100million fine on the bank in respect of failure to comply with its guidelines on Diaspora remittances.

Other fines imposed on Access Bank by the CBN and SEC include the sum of N2.9million in respect of delayed response to the queries of the SEC on cases with two customers and N2million in respect of the violation of CBN’s directive on migration of some accounts to a specified product.

The lender was further fined N80million for contravening the CBN’s Forex regulations between January 1, 2013 and July 31, 2020.

It was also fined N0.5million by SEC for contravening the regulator rule for receiving bank.

The apex capital market regulating body SEC further asked Access Bank to pay N0.5million as fine in respect of a shareholder’s complaint on dividend.

The CBN also imposed N2million on the lender in respect of a consumer protection report for the period from July to December 2020.

Besides, Access Bank was fined N2.25million for allegedly failing to comply with the CBN’s Anti-Money Laundering and Counter-Terrorism Financing regulations and Know-Your-Customer policies in respect of a customer’s account.

Fidelity Bank recorded a fine of N65.15million during the first half of 2021 for committing five market infractions.

The CBN fined the lender N60million for committing forex trade infraction and N2million for another forex infraction as well as penalty for risk-based supervision for the period 2018/2019.

SEC also fined Fidelity Bank the sum of N1.13million for late filing of its December 31, 2020 audited financial statements.

The lender was also fined N25,000 for filing its returns late with the CBN.

The lender was also fined the sum of N414.5million in the previous half year for committing four infractions, including Forex, trade and Open Market Operations (OMO) violations.

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