CBN, SEC Fine Stanbic IBTC N227million over Misuse of Forex, Operational Abuse

CBN, SEC Fine Stanbic IBTC N227million over Misuse of Forex, Operational Abuse

- Stanbic IBTC was fined N277 million by CBN and SEC, as the company was penalised for various misconduct

- N273.96 million was paid to the financial regulator, while N3.38 billion went to the capital market authority

- Stanbic IBTC was fined for misuse of forex, failure to report suspicious transactions done with the bank

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Stanbic IBTC lost N277 million to ten penalties last year after several operational abuses drew the wrath of the Central Bank of Nigeria (CBN) and Securities and Exchange Commission (SEC).

The CBN fined Stanbic IBTC eight times, costing the lender N273.96 million, while SEC sanctioned the bank twice, resulting in an N3.38 million loss on the part of Atedo Peterside's company, analysis of the company's FY 2020 financials showed.

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The N277 million paid by the lender in 2020, is significantly higher than the N102 million fine paid during the corresponding period of 2019.

What is Stanbic IBTC's offense?

Part of its activities that contravened the apex bank's directive included the use of forex to import textiles, which is on the list of items banned from receiving forex in the Nigerian market or banks.

Aside from offering forex against CBN's directive, Stanbic IBTC also failed to report some alleged suspicious transactions. It also contravened the extant rules on cash evacuation while transferring to its offshore account through Messrs.

It was learnt that the lender also failed to obtain approval from the financial regulator for validation of non-valid for the foreign exchange transaction. Also, it didn't fully comply with the directive on linking BVN with signatures, directors and beneficial owners to their respective entity accounts (Incorporated and Non-Incorporated).

Key points from CBN sanction

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"Penalty on Involvement in Textile Importation Using FX Sourced from the Nigerian Market. The CBN imposed a penalty of N152 million on the bank following the investigation which was conducted on foreign exchange used to import textiles for the period of 02 & 15 October 2019.
"Penalty on Involvement in Textile Importation Using FX Sourced from the Nigerian Market. The CBN imposed a penalty of N10 million on the bank following the investigation which was conducted on foreign exchange used to import textiles for the period of 16 October - 30 November 2019.
CBN, SEC Fine Stanbic IBTC N227million over Misuse of Forex, Operational Abuse
Atedo Peterside and CBN governor, Godwin Emefiele. Photo: Twitter (R)/PHILIP OJISUA/AFP (L)
Source: Getty Images
"Penalties arising from the AML/CFT examination of the Bank. The CBN imposed a penalty of NGN20 million on the Bank for failing to report some alleged suspicious transactions.
"Cash evacuation penalty. The CBN imposed a penalty of NGN32million on the bank for contravening the extant rules on cash evacuation to the bank’s offshore account through Messrs.
"Penalty of N2 miliion for failure to obtain CBN approval in the validation of non-valid for foreign exchange transaction.

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"Penalty of N2 miliion by CBN for not fully complying with the directive on Linking BVN Details with Signatures, Directors and Beneficial Owners to their Respective Entity Accounts (Incorporated and Non-Incorporated).
"The CBN penalized the Bank for the sum of N43,200,000 in respect of an alleged contravention of the provision of memorandum 25(5)(b) of the CBN’s FX Manual in processing FX transfers.
"Underpayment of Industrial Training Fund (ITF) contribution- The ITF imposed a penalty on SISL amounting to N12.76 million for its underpayment of ITF contribution over a 5 year period (2013 to 2018)."

Key points from SEC sanction

"The SEC imposed a total penalty sum of N3,000,000.00 against SIAML for maintaining its mutual funds collection bank accounts with a non-custodian.
"Breach of SEC rules- The SEC imposed a penalty sum of N386,000 on SINL for breaching the SEC rules as well as the Fund's Trust Fund with respect to the Vantage Equity Fund."

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Meanwhile, Legit.ng had previously reported that Aliko Dangote and Folorunsho Alakija both recorded a significant decline in their wealth, according to a six years Forbes billionaire report tracked by Legit.ng.

Both billionaires recorded an $18.2 billion wiped off their fortune between 2015 to 2020. The decline cost Alakija a spot on the billionaire watch list, as she was dropped, while Dangote remained Africa's richest, but with a reduced networth.

Source: Legit.ng News

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