Diamond Bank, 3 others indicted in MTN’s $14bn scandal

0
481

By Odunewu Segun

Four banks have been indicted for aiding telecom giant, MTN Group, in illegally moved almost $14 billion out of Nigeria over a 10-year period, beginning from 2006.

Senator Dino Melaye who made the accusation indicted Standard Chartered Plc, Citigroup Inc, Stanbic IBTC Holdings Plc and Diamond Bank.

MTN shares also slumped, falling as much as 4.4 per cent, what would be the biggest fall on a closing basis since June 27, and traded 3.4 percent lower at 119.77 rand as of 1:32 p.m. in Johannesburg. That values the company at 221 billion rand ($16.3 billion).

The accusation comes a little over three months after MTN agreed to pay a N330bn  ($1 billion) fine in cash to the Federal Government and list its local unit on the country’s stock exchange after about eight months of negotiations.

ALSO SEE: MTN NCC declines MTN request on Visafone

The penalty was levied for missing a deadline to disconnect 5.1 million customers unregistered in the country. The stock has fallen more than 37 percent since the fine was first reported in October, allowing crosstown rival Vodacom Group Ltd. to overtake the company in terms of market valuation.

“It’s not a good thing for MTN that there is a lot of noise being made again around corporate governance,” Sasha Naryshkine, an analyst at Johannesburg-based money manager Vestact Ltd., said by phone. “It’s difficult to move money out of the country illegally as it has to be moved through the central bank.”

MTN shares had fallen earlier on Tuesday after the Nigerian telecommunications regulator blocked the carrier’s attempt to take over internet spectrum owned by closely held Visafone, which it had agreed to buy in January. MTN is trying to add capacity to extend internet access in Nigeria and South Africa as revenue from voice services declines.

The Nigerian Communication Commission (NCC) had earlier blocked MTN’s Nigeria request to acquire the spectrum being used by Visafone even though it approved the acquisition of 100 per cent shareholding in Visafone.

According to the NCC, the acquisition of Visafone frequency could perpetuate MTN’s dominant position in the Nigerian telecommunication market.

 

 

Leave a Comment

Leave a comment

NO COMMENTS

LEAVE A REPLY