CBN Raises Alarm Over Illicit Naira Transactions, Urges Strict Measures

The Central Bank of Nigeria (CBN) has expressed concerns over the growing trend of illicit transactions involving banknotes, warning that this practice threatens the stability of the financial system.

The CBN Governor, Dr. Olayemi Cardoso, disclosed this at the bank’s security workshop in Abuja on Thursday, attended by the the National Security Adviser (NSA), Mr. Nuhu Ribadu, and security and law enforcement agencies.

Cardoso revealed that mystery shopping exercises conducted in major commercial hubs uncovered disturbing instances of naira commoditization and abuse.

“A critical concern that arises from these transactions is an illegal act and a premium charged on banknotes ranging from 20 percent to 40 percent per transaction,” he said.

He cited a recent case where banknotes amounting to N2.3 million were acquired at a total payment of N3.2 million due to inflated pricing by illicit cash traders.

The CBN governor warned that this practice distorts the value of the naira and undermines public confidence in the financial system.

He also expressed concerns over the abuse of the naira on social media, where individuals are seen mishandling, spraying, and even stepping on banknotes at social events.

“When we talk about credibility and trust, we don’t build it this way,” Cardoso said.

“The blatant disregard for our nation’s legal tender not only weakens the value of the Naira but also erodes respect for our national identity.”

Cardoso called for strict measures to deter perpetrators, stressing the role of law enforcement agencies in identifying and prosecuting individuals engaged in illicit currency dealings.

He pointed out the need for stronger collaboration to combat illicit currency trading activities.

The NSA Nuhu Ribadu, also noted the need for law enforcement agencies to take stronger action against offenders.

“Impunity is the mother of all the problems we have. Nobody is punished for bad behavior, and they don’t even see it as a bad thing until they are held accountable,” Ribadu said.

Ribadu raised concerns over the unregulated transportation of cash, citing instances where commercial aircraft are used to transport large sums of cash.

He called for stricter regulations and oversight to address the movement of cash within the country.

The CBN governor and Ribadu urged financial institutions to strengthen their internal security measures and called on law enforcement agencies to be proactive in tackling emerging threats.