No evidence shows MTN laundered $13bn – Senate

MTN fine

The Senate has said it found no proof that telecommunications company, MTN laundered large sums of money out of the country.

Background:

  • Senator Dino Melaye in 2016 had accused MTN of illegally taking $13.9 billion to its parent company in South Africa.
  • He also alleged that the money was transferred through some commercial banks.
  • He said they were transferred through Stanbic IBTC, $4.87bn; Standard Chartered Bank, $5.72bn; Citi Bank, $2.98bn; and Diamond Bank, $0.35bn.

What is happening:

The Senate said it can’t conclude that a crime was committed merely through evidences of cash transfers.

“No doubt there is a disturbing evidence of foreign exchange haemorrhage in Nigeria especially in the period of recession. MTN, for instance, repatriated over $1.3 billion annually since 2006 or $13.92 billion between 2006 and 2016,” the report approved by the senate read.

“Just for one company, the phenomenon constitutes a huge outflow that could pose challenges for foreign exchange and national monetary stability.

“The committee did not receive proofs of collusion to contravene the foreign exchange laws. There was evidence of massive capital outflow, but that alone is not conclusive that a crime has been committed.

“This was relied on by banks, which claimed that despite regular audit by CBN, the CBN did not apply any sanction that a crime has been committed.”

The senate unanimously approved the recommendation of the investigation panel which are:

“Condemn the CBN for failing in its duty to bring forth those observed deficiencies of FEMMA for amendment rather than granting extensions and exemptions, which became prone to abuses.

“Mandate the CBN to sanction Stanbic IBTC for improper documentations in respect of capital repatriation and loan repayments amounting to $388,195,183 and $199,440,952:07, respectively.

“Mandate the CBN to sanction the activities of Stanbic IBTC nominees in the matter of shares transfer and splitting for the purpose of dividend repatriation.

“Mandate the CBN to come up with a proposal for the amendment to FEMMA, with a view to ensuring the growth of the economy through massive foreign capital inflow and greater retention of foreign exchange. The amendment is still ongoing in the senate.

“Direct the CBN to forthwith render periodic status reports to senate on the performance of foreign investments inflows and outflows.”

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