Dr. Olayemi Cardoso, the governor of the Central Bank of Nigeria (CBN), revealed that a substantial portion of the $7 billion foreign exchange backlog inherited upon his assumption of office consisted of approximately $2.4 billion linked to non-existing entities, requests lacking import documents, and various other infractions.
Cardoso addressed these matters during a Monday interview on Arise TV, addressing concerns about the recent turbulence in the currency market. He explained that the CBN embarked on the process of settling the obligations with the limited resources available, paying what was deemed valid and due for payment. However, due to the magnitude of the backlog, it was not feasible to address the entire sum in one go.
Recognizing the need for a closer examination of these obligations, the CBN enlisted the services of Deloitte management consultants to conduct a forensic audit. The objective was to determine the validity of each transaction comprehensively.
The results of the forensic audit were, according to Cardoso, startling. Out of the $7 billion, around $2.4 billion raised concerns. The identified issues ranged from lacking valid import documents to instances of non-existent entities. Additionally, some account parties received more foreign exchange than requested, while others who did not request any received funds. These findings pointed to a myriad of infractions.
In response to how the central bank intends to handle these contentious transactions, Cardoso succinctly stated, “We are not paying if you don’t qualify.”
This revelation sheds light on the complexities the CBN faces in navigating the existing foreign exchange challenges and underscores the commitment to rectifying irregularities in the system.