Alleged N500bn fraud: CBN clarifies what happened

The Central Bank Bank of Nigeria, CBN, has described as total false a wide-spreading report which claimed that Governor Godwin Emefiele connived with one of his deputies and other top officials to steal billions of naira from the coffers of the apex bank.

Recall that Sahara Reporters at the weekend had published an exclusive on which it reportedly exposed a N500 billion fraud committed by Governor Emefiele, his Deputy, Edward Lametek Adamu, and some other officials.

The publication contained an audio recording of a conference telephone conversation between Governor Emefiele and the others in which the governor was conversing with the CBN Director for Finance, Dayo M. Arowosegbe.

From the conversation, the online news platform alleged that over N500 billion had been lost, stolen from the CBN in a private investment that went bust.

But in the statement signed by the apex bank’s Director of Corporate Communications, Isaac Okafor, CBN recounted how, in 2015 following the global oil crash, the CBN was approached by the National Economic Management Team and the National Economic Council (NEC), to help State Governments with Conditional Budget Support. This is bearing in mind that the depreciating oil prices had affected FAAC allocations to states, thereby making it nearly impossible for some states to pay workers’ salaries.

According to the statement, the CBN responded by providing a N650 billion loan to 35, out of the 36 states in the Federation.

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“In order to ensure that ordinary Nigerians workers got their salaries, pensions and gratuities, and that the economy continued to recover from recession, the bank provided about N650 billion in loans at 9% with a two-year grace period to 35 states of the federation.”

“Fast-forward to 2018, external auditors classified about N150 billion of the CBN loan to states as bad loans. This is said to have “negatively affected the Bank’s Balance Sheet and shareholders fund.”

The CBN press statement, therefore, clarified that the leaked conference call between Governor Emefiele and his colleagues, was held in a desperate attempt to understand why the auditors categorised the loan as bad debt.

The statement went further to clarify that the misunderstanding was later rectified, thanks in part to the intervention of the Federal Ministry of Finance.