Deposit Money Banks (DMBs) that were found to have distributed illegal mint naira notes to currency hawkers throughout the nation have been fined ₦150 million by the Central Bank of Nigeria (CBN).
Following CBN’s efforts to rectify recent disinformation about the legitimacy of the old banknotes—specifically, the N1000, N500, and N200—that are still in use, this move was taken. The bank confirmed in a statement written by Sidi Ali Hakama, acting Head of Corporate Communications, that these denominations are still recognized as legal money in line with a November 29, 2023, Supreme Court decision.
Additionally, the warning cautioned against keeping these notes.
Following the explanation, CBN expressed alarm about the growing number of mint naira notes being sold by hawkers in a circular signed by Mohammed Olayemi, Acting Director of the Currency Operations Department, on Friday. The practice, according to CBN, impedes the efficient and effective distribution of cash to consumers and the general public. The circular emphasized the apex bank’s resolve to address the naira’s commodification and referred to a previous order dated November 13, 2024.
Any financial institution branch found to be at fault under the directive will be fined N150 million for the first infraction. The CBN cautioned that subsequent violations would result in harsher penalties under the Banks and Other Financial Institutions Act (BOFIA) 2020.
Continuing, CBN announced that it would boost the frequency of spot checks in ATMs and banking halls and use mystery shoppers to find illegal cash hawking locations nationwide to ensure compliance.
According to the circular available to BrandSpur banking and finance news desk: “The CBN has noted with dismay the prevalence of illicit flow of mint banknotes to currency hawkers and other unscrupulous economic agents that commodify Naira banknotes, thus impeding efficient and effective cash distribution to banks’ customers and the general public.
“CBN will continue to intensify the periodic spot checks to the banking halls/ATMs to review cash payouts to banks’ customers, as well as mystery shopping to all identified cash hawking spots across the country.
“In this regard, any erring deposit money banks or financial institutions that are culpable of facilitating, aiding, or abetting, by direct actions or inactions, the illicit flow of mint banknotes to currency hawkers and unscrupulous economic agents that commodify Naira banknotes shall be penalised at first instance N150,000,000.00 (One hundred and fifty million Naira) only, per erring branch, and at later instances, apply the full weight of relevant provisions of BOFIA 2020,” it added.
However, to stop their systems from being used for illicit transactions, the CBN also advised DMBs to improve the controls, protocols, and processes around their Cash Management Centers, branches, and teller operations.
