Nigeria: CBN Directs Banks to Reveal Names, BVN of Forex Defaulters

The Central Bank of Nigeria (CBN) has directed banks to publish names of customers who try to break the rules on Forex acquisition on their website.

The apex bank on Monday, August 30th issued a circular (BSD/DIR/PUB/LAB/14/059) to all banks lamenting that it has “received and noted with concern reports of sharp practices by some unscrupulous customers to circumvent the new CBN policy on the sale of forex for overseas personal and business travel.”

Some of the unwholesome practices, the CBN said: “include the use of fake visas and cancellation of air tickets after purchase of PTA/BTA.”

According to the Director Banking Supervision Department of the CBN, Haruna Mustafa, who signed the circular, noted: “this trend, if not curbed, portends risk to the integrity and stability of the forex market”.

To curb this threat, he ordered all banks “to publish on their websites the names and BVN of defaulting customers who present fake travel documents or cancel their tickets and fail to return the purchased PTA/BTA within two (weeks) as stipulated in the customer declaration form signed by them”.

Prior to this order, most banks had written to their customers of their commitment to provide customers with foreign exchange for their Personal and Business Travel as well as payment for overseas Education, Medical and other eligible invisible transactions.

The rules that customers have to follow before they can access forex the bank said are: FX shall be sold for Legitimate Travel Purpose Only.

Bank customers are required to provide a valid Nigerian passport and a valid visa to an international destination.
Only valid travel documents like tickets to an international destination outside of West Africa and Cameroon will be accepted.

The international return ticket must have a travel date not more than 14 days from the date of PTA/BTA purchase.

Bank customers can only apply for PTA/BTA once in a quarter: PTA and BTA requests are limited to a maximum of $4,000 and $5,000 per quarter per applicant respectively.

Customers are required to return purchased PTA/BTA to their bank within two (2) weeks from the date of purchase if not utilized for the intended purpose or if for any reason the scheduled trip is cancelled.

Those wishing to buy Forex are also not allowed to apply for Forex on behalf of a third party.
FX will only be sold directly to applicants who shall be Nigerians who are 18 years and above and have a valid Bank Verification Number (BVN).

False application and use of fake documents to purchase PTA/BTA is prohibited and is now considered a financial crime punishable under the applicable laws in Nigeria.

Defaulters of the CBN’s new FOREX policy “may face sanctions that include being barred from accessing FX from the official FX market in the future, restrictions on their bank accounts for such periods as may be determined by the CBN as well as possible criminal prosecution”.

Omotayo Araoye

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