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The House of Representatives’ Ad Hoc Committee on Unclaimed Funds in the Nigerian Commercial Banks and Infractions by the Central Bank of Nigeria has begun investigation of funds stuck in the Deposit Money Banks, also known as commercial banks, due to the failure to link the account holding them to a Bank Verification Number and the Treasury Single Account policy of the Federal Government.
The committee is particularly probing into the over 45 million accounts said to be holding funds amounting to over N1.2tn.
The House had on January 26, 2022, resolved to set up the committee to investigate the “suspicious and unclaimed funds” sitting with various accounts.
The House had mandated the committee to also investigate the unremitted funds collected on behalf of ministries, departments and agencies of the Federal Government by the banks.
The House had further mandated the committee to look into the alleged “several infractions by the Central Bank of Nigeria against the provisions of the enabling Act and Laws of the Federal Republic of Nigeria and the good people of Nigeria, especially in the area of intervention projects and programs.”
The committee is to report back within eight weeks for further legislative action.
These resolutions were based on a motion moved by a member, Dachung Bagos, titled ‘Need to Investigate Unclaimed Funds in Nigerian Commercial Banks and the Infractions by the Central Bank of Nigeria,’ which the lawmakers unanimously adopted.
Moving the motion, Bagos noted that the Bank Verification Number was introduced by the CBN in 2014 to the Nigerian banking system as a way of checking and combating money laundering, illicit financing and duplicitous ownership of bank accounts used for fraud.
He also noted that about seven years after the introduction of the BVN, about 45.85 million bank accounts across Nigeria are yet to be linked to BVNs, as data released by the Nigerian Inter–Bank Settlement Systems on June 23, 2021, disclosed that the total number of bank accounts in Nigeria, as of May 2019, was pegged at 122.071 million and the active accounts, as of May, 2020 stood at 72.936 million.
On Monday, the committee was inaugurated with several invited ministries, departments and agencies of the Federal Government as well as banks in attendance.
Chairman of the committee, Unyime Idem, after representatives of the MDAs made their remarks, said, “For commercial banks, this resolution stipulates that you submit documents that would help us recover unclaimed funds in about 45 million accounts that are not linked to the BVN.
“About 45 million accounts are what the House has been able to discover through the recent reports. Those accounts are not linked to BVN. So, money in those accounts, we want to know the positions, whether you have refunded the FG or what happened to the funds. You are going to give us documents to back these investigations.”
According to Idem, the committee’s assignment is “enormous, crucial and sensitive, given what the country is facing economically.”
He said, “We believe that the outcome of it (probe) would help the country to recover a very substantial part of the unclaimed funds that have been hanging in some of the Nigerian commercial banks and other unauthorized hands.
“Money meant for the Federal Government is not supposed to sit with unauthorized hands for a very long time. Any money that was disbursed or meant for the Federation Account, if the contract has failed or was not executed, the proper thing is for the money to be refunded to the same source it came from.
“But unfortunately, whether out of oversight or deliberate; for whatever reason, so much money, based on the recent discovery, has been tied down somewhere. That is what informed the National Assembly, precisely the House of Reps, to commence this investigative hearing.”
The lawmaker also read a riot act to the stakeholders, saying, “For commercial banks and other agencies that are sitting on these funds that belong to the Federal Government, that are not willing show cooperation and not willing to refund; for banks that are collecting funds on behalf of the government, I think this House would not have a choice but to stop you from collecting funds on behalf of the government if you don’t show cooperation.
“But if you do, it would be a win-win. When we look at your books and then you check the one that belongs to the government and refund it appropriately, there would not be any issue.”
Earlier while declaring the event open, Deputy Speaker of the House, Ahmed Wase, noted that the motion stated that about N1.2tn was not paid into the Consolidated Revenue Fund. He said the probe was necessary “so that we can improve the infrastructure deficit and other challenges in our nation.”
In his remarks, Director-General of the Budget Office, Ben Akabueze, who represented the Minister of Finance, Budget and National Planning, Zainab Ahmed, noted that over years, there had been circulars from government authorities to those concerned to enforce the TSA and BVN policies.
Akabueze said, “When we received this invitation that talked about unclaimed funds in Nigerian commercial banks, basically, my initial reading of this was that it was related to inactive accounts, dormant accounts; because the extant regulation guiding the management of these issued by the CBN, in October 2015, provides guidelines for the management of inactive accounts dormant accounts and unclaimed funds.
“Those guidelines obligate any bank to have notified the Federal Government of the existence of any such funds belonging to it. If they had I am sure that those funds would not be there. I hope, without prejudice to the work of this committee, that the CBN would also do the job of enforcing its own guidelines.
“As the work of the committee progresses, whatever other specific information required of us as a ministry, we would be able to provide.”
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