•••Says Defaulters To Face Three Years Jail Term
The Nigerian Financial and Intelligence Unit (NFIU), has set March 1, as the date for the effective commencement of the cashless policy of the Central Bank of Nigeria.
The NFIU said that all government transactions would be automated on adherence to the current monetary policy.
The Director and Chief Executive Officer, NFIU, Modibbo Tukur, made the disclosure at a press briefing in Abuja on Friday.
He said that violators of the policy risk three years imprisonment.
According to him the Nigeria Financial Intelligence Unit (NFIU), Economic and Financial Crimes Commission (EFCC) and Independent Corrupt Practices Commission (ICPC) would embark on collaborative investigation defaulters who withdraw cash from public accounts.
He described the rate of violation of the withdrawal limit in spite of the introduction of the cash withdrawal limits as alarming,
He pointed out that state governments withdraw a total of N701 billion cash above the N225 billion withdrawn by the federal government and N156 billion withdrawn by the local government areas between 2015 to date.
However, he observed that the new guidelines, grants the President the a waiver for any cash above the approved daily threshold to be withdrawn for any urgent or emergency reasons.
The NFIU boss, stated also that the President is empowered to grant waivers to government officials based on considerations.
The NFIU urged the three tiers of government to put the requisite measures in place to ensure the smooth operationalization of the new policy.
“With the implementation of this guideline, Nigeria has been taken into a non-cash economy with effect from March 1, 2023.
“The rate of withdrawals above the threshold from public accounts has been alarming, over N701 billion has been withdrawn in cash from 2015 till date.
“The NFIU had told banks and government agencies at all levels to go fully digital by moving online, as all transactions involving public money must be routed through the banks for the purpose of accountability and transparency.
“This is not reversible as we are only enforcing the law. As far as we are concerned, Nigeria will become a full non-cash economy by March 1, 2023 this year. As a consequence, any government official that withdraws even one naira cash from any public account from March 1 will be investigated and prosecuted in collaboration with relevant agencies like EFCC, ICPC and the NPF.
“For government exigencies, only the President has the power to grant any waiver to any government official considering the importance of the situation; either for national security, health, or other important reasons.
We found within the operation of the financial system, and legislative amendments from the National Assembly, which was appended to by the President, for reasons to discontinue completely cash transactions from public accounts.
“And the reasons are the provisions of the money laundering Prohibition Act, particularly section two created threshold limits and withdraws of cash from all corporate body accounts and put them at N10 million.
“But again, section 13 of the same Act, advise that in a situation where you run into new developments, that making the operationalizing of certain provisions difficult that’s section 13, you have to make recourse to development of new products and response to new technologies to address the issues.
“Then we have Section 26 of the Proceeds of Crime Act. So the provisions of all of them, one, section two, provided that the withdrawal of cash above those thresholds should be punished with imprisonment of up to three years or fine of three times or twice the amount of the money that was being withdrawn.
“So you are all aware of the inflation in the economy, public servants traveling this and that. So the mark of withdrawing above the threshold is becoming very frequent. So when we compiled the cash withdrawals over a period of time, precisely from 2015 to date, we discovered the state governments have withdrawn over N701 billion in cash, with some states withdrawing up to N24 billion.
“And then we also discovered that the Federal Government withdrew in cash up to N225 billion while the local governments withdrew up to N156 billion.
“So if we are to apply the law here, all the public servants involved in this withdraws are entitled to three years imprisonment. That’s what the law said. And then Section 26 of the Proceeds of crime, I had said that wherever that cash is seen, it should be seized. So, there is provision for seizure of cash.
“So, now, having looked at the principles of the law, and the provisions of that law, it became necessary for us to direct and order the financial institutions to stop completely cash withdrawal from public accounts at federal, state and local government level henceforth.
“This is for the protection of the system for the protection of the public servants and the chief accounting officers of state and for the protection of the elected public officials who are running the finances, there is no option to that. So, what we are advising on the guidelines is that they should make a recourse to technology as the law requested, and they should also make recourse to training and we are not stopping there because you as you know this, the Central Bank of Nigeria is also changing the new currency notes.
“From what we are seeing there is also need for the new currency provision to adjust to the market operation. And the way it will adjust is to go by the withdrawal limits imposed by the Central Bank, there is no doubt about it. These are not our own issues, they are issues of Prudential management of the central bank, they are issues having to do with liquidity management in the financial system.”
However, Modibo did not attribute the violation of the withdrawal threshold to corruption.
“So, far, there is no threat of corruption from the statistics we have that we run over this period that the new banknotes was introduced. Still, withdrawals are higher than deposits.
“So, which means that the statistics shows that withdrawals are still slightly higher than deposits, and is an indication that the market is not rushing to return the old notes. Rather the market is only interested in getting liquidity to finance market operation.
“So, there is no imminent threat if the reverse was the case, for example, there is rush to return the money back to the financial system in form of deposit. That is when we are going to suspect there are people who are seriously stuffing cash in their own houses.
“So as far as corruption or money laundering are concerned. And we have the records, there is no imminent suspicion or threat from the financial system. And this is statistically proven. So if you have questions on the liquidity side of it, I think you can approach the central bank. So these are the issues.”
