United Bank for Africa (UBA) and four other top banks in Nigeria paid a total of N1.4bn as penalties to financial regulatory bodies such as the Central Bank of Nigeria, Security Exchange Council and Financial Reporting Council of Nigeria, in the first half of the year.
The banks involved in the forex infractions include Fidelity Bank, Access Bank, GTBank and First City Monument Bank.
The penalties were as a result of contraventions and infractions of guidelines instituted by the Federal Government through the Banks and Other Financial Institutions Act, relevant CBN circulars and other regulatory requirements.
The president, Muhammadu Buhari, had in November 2020, signed the amended BOFIA Act 2020 which repealed the erstwhile BOFIA 2004. The BOFIA was first enacted in 1997 empowers the CBN to implement its provisions as a regulatory framework to guide the financial industry.
Available information on the banks’ websites shows that during the period under review, GTB paid a total sum of N692m as penalties to regulators for two major infractions bordering on foreign exchange transactions carried out by Betting and Gaming Companies (N690m) and non-refund of interest on debit of non-interest related charges to non-funded accounts (N2m).
Fidelity bank paid the sum of N64.1m to the CBN during the period under review, for forex trade infractions and other forex infractions, risk-based supervision between 2018 and 2019 and late returns.
SEC also sanctioned the bank within the review period to the tune of N1.1m for late filling of its December 31 2020 Audited Financial Statement.
According to the financial reports, Access Bank was fined N184.5m by the CBN while SEC fined the bank N1m during the review period.
The violations committed by the bank include, “contravening the Central Bank’s Foreign Exchange Regulations from January 1, 2013 to July 31, 2020, contravention of rule for receiving bank, a shareholder’s complaint on dividend, CBN’s Consumer Protection report for the period of Jul 2020- Dec 2020, failure to comply with the CBN’s money laundering/combating the financing of terrorism regulations and Know Your Customer policies in respect of a customer’s account and failure to comply with Guidelines on Diaspora remittances.”
FCMB Group’s penalties rose from N150.2m paid to regulatory bodies in H1 2020 to N162.3m during the same period in 2021.