Stella Dimoko Korkus.com: FG Proposes Gaol Term For Dollar Hoarders

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Monday, November 21, 2016

FG Proposes Gaol Term For Dollar Hoarders

The Federal Government has proposed an amendment to the Foreign-Exchange Act to enable the imprisonment of anyone who holds foreign currencies, especially the dollar, for more than 30 days.


This is the latest measure the government and the Central Bank of Nigeria are considering to stem the volatility in the exchange rate and bolster the ailing naira, according to a Bloomberg report.

In the new proposals, which were published on the website of the Nigerian Law Reform Commission last week, the CBN is seeking the power to control capital flows and stop people from taking forex out of the country.

According to the draft amendment of the Foreign Exchange Act, anybody holding dollars in cash for more than 30 days risk a jail term for as long as two years or a fine of 20 per cent of the amount.


Regulators should also be able to prevent money being repatriated “in accordance with the terms and conditions as may be prescribed by the central bank from time to time,” the draft states.

The existing law is “narrow in scope and prohibits the seizure, forfeiture or expropriation of imported money by the government without providing for exceptions,” it adds.

The amendments, according to the document, are necessary “for effective monitoring and control, and to ensure probity in foreign exchange transactions in Nigeria.”

The CBN has increased capital controls since the price of oil, Nigeria’s main foreign exchange earner, started crashing in the second half of 2014.

It had pegged the naira for 15 months until June this year, a move analysts blamed for causing investors to flee the country, the economy to contract in the first half of the year and the inflation rate to rise to an 11-year high.

The latest move will further worry foreign investors, according to a Lagos-based research and investment advisory firm, SBM Intelligence.

The Department of State Security officials had last week arrested some black market forex dealers for exchanging the naira at a rate weaker than 400 per dollar, compared with the existing street rate of around 460.

The naira-dollar official exchange rate, which analysts accused the CBN of still manipulating, is 315 against the greenback.

“The CBN wants to take its regulatory onus to frightening proportions,” analysts at SBM said in an e-mailed note in response to the new draft law.

“The move smacks of desperation and can only result in negative investor perception and capital flight,” they added.

The Acting Director, Corporate Communications, CBN, Mr. Isaac Okorafor, said the apex bank did not introduce the bill in a text message response to Bloomberg. He did not elaborate.

The Chief Executive Officer, Cowry Asset Management Limited, Mr. Johnson Chukwu, while reacting to the development said, “If it did not emanate from the CBN as claimed by its spokesman, it may have emanated from the Presidency or other sources. But the fact is that when you compel people not to hold dollars after stopping the use of naira debit cards abroad, you are discouraging people to bring in money into the country.

“You also push more people to the parallel market and create further gap between the official and black market exchange rates.”

FROM Financialwatch



21 comments:

  1. Replies
    1. Don't understand this whole dollar thing.

      Your comment will be visible after approval.

      Delete
    2. Will that really work? I do not think so!

      Delete
    3. SPELL CHECK OOO. WETIN BE GOAL
      OLODO Olodo OlODO oLodO
      OLODO Olodo OlODO oLodO
      OLODO Olodo OlODO oLodO
      OLODO Olodo OlODO oLodO

      Delete
    4. Anonymous Master Olodo. What is all this nonsense. I got time to comment on your bullshit today.
      Next time enrol in a programme,not school oh and educate yourself a bit. In your bid to insult your generation you floored yourself. Now consult google cos your mb is just wasted on your bitter life.
      I can help you out a bit.

      GAOL: a place for the confinement of people accused or convicted
      of a crime. (Google definition)

      That's where you are headed to in no distant time.

      Aturu muru ebule gba aka nwa. Na so your life be.

      Delete
    5. I don't understand. It's their money and they can do whatever. If someone decides to hoard their $$ for years. Who's business should it be?

      Delete
  2. This CBN governor I don't even know what to tell you? Waste of space at the CBN.

    ReplyDelete
  3. If i hear?
    Kam nukwa na echi aburo skul

    ReplyDelete
  4. Where do they get these shitty ideas from??? They should start arresting themselves and their cronies first. Instead of looking for ways to promote exports, particularly removing the bottlenecks at Customs so as to generate inflow of forex.... Oshikoshi! Arrant nonsense!

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  5. So in other words it is a crime to hold dollars for more than 30 days. Like real jail term? Ok all I can say is that there is fire on the mountain.

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  6. These people don't know what the are doing

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  7. What i find truly tragic is our government's insistence that the best way ( and perhaps only way) to kill a tree is by cutting off its branches. This government will easily win a global award for its characteristic and almost juvenile preoccupation with going around a problem rather than directly confronting it. While i do not endorse the practice of hoarding dollars, I completely detest the incompetency and moral infirmity of this government in fighting the root cause(s) of corruption.
    Hi guys!
    You only have one shot at life. If you’re interested in improving the quality of your life and fulfilling your destiny, let me recommend www.kayceeokuma.com to you. You’ll love it!

    ReplyDelete
  8. What i find truly tragic is our government's insistence that the best way ( and perhaps only way) to kill a tree is by cutting off its branches. This government will easily win a global award for its characteristic and almost juvenile preoccupation with going around a problem rather than directly confronting it. While i do not endorse the practice of hoarding dollars, I completely detest the incompetency and moral infirmity of this government in fighting the root cause(s) of corruption.
    Hi guys!
    You only have one shot at life. If you’re interested in improving the quality of your life and fulfilling your destiny, let me recommend www.kayceeokuma.com to you. You’ll love it!

    ReplyDelete
  9. Let this CBN governor start with himself. Let him swear he doeant have safe in his house that he keeps his own dollars. Oh, I forget, they move theirs at night and cant keep in the bank. What nonsense are they talking about?At least the banks I believe trade with the money in the bank which is normal. Where do they want people to keep their money now? Under the bed? They can as well mandate all the banks to stop domicilliary accounts cos this doesnt make any sense at all.

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  10. They should have a limit of amount that should be left in the bank. If I take out all which mean sey bank go close. Can someone please sack this CBN governor?

    ReplyDelete
  11. a.k.a EDWIN CHINEDU AZUBUKO said...
    .
    Gud to knw....
    .
    .
    ***CURRENTLY IN JUPITER***

    ReplyDelete
  12. The rule actually applies to those who operate a bureau de change. Not the common man.

    ReplyDelete

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