• Sunday, April 14, 2024
businessday logo

BusinessDay

Senate probes $2.4bn ‘invalid’ FX transactions

Akpabio’s 10th Senate breaks tradition, operates without legislative agenda

The Senate on Tuesday opened an investigation into the alleged $2.4 billion foreign exchange transactions pronounced invalid by the Central Bank of Nigeria (CBN) from the outstanding $7 billion obligations.

The move by the Senate is to identify the culprits and bring them to justice to serve as a deterrent.

The upper chamber resolved to probe the forex transaction after considering and approving the report of its joint committees on banking, insurance and other financial institutions, finance, national planning, agriculture and appropriation on the state of the economy which contained various recommendations.

Read also: Uproar over N30tn ways and means loan as Senate launches probe

Olayemi Cardoso, the CBN governor earlier this month, said that a forensic audit of $7 billion of overdue foreign exchange transactions the bank had been trying to clear, uncovered irregularities around $2.4 billion transactions.

The Senate said the probe would enthrone transparency, boost confidence in the foreign exchange market and also strengthen the naira.

The report also recommended that the government should prioritise liquidating the N30 trillion Ways and Means obligation of the Federal Government through a quicker resolution mechanism than the current securitisation arrangement over 40 years.

In addition, the Senate called on the CBN to put in place measures to ensure the repayment of various intervention programmes by the beneficiaries after a thorough evaluation of their performance, to reduce the money supply.

The Senate further asked the joint committee to interrogate the sudden revision of the rate calculation methodology by the FMDQ on Monday, January 29, 2024, and the resultant sharp increase in the NAFEM rate from N891/5 to N1,348.63.

The lawmakers observed that the revision adversely impacted the value of dollar-denominated obligations, stressing that the probe was necessary to safeguard investments, and protect jobs and economic agents in Nigeria with foreign currency exposure.

Read also: Senate seeks suspension of tax waivers, as Nigeria loses N17 tn in five years

“We are convinced that the implementation of the recommendations contained in this report will go a long way in bringing down inflation, strengthening the naira and stabilising the economy. Indeed, the gravity of the situation demands a collective commitment to implementing these recommendations and forging a path towards economic stability”, the report stated.