Godwin Emefiele, the governor of the Central Bank of Nigeria, has cautioned politicians who want to withdraw their naira in exchange for dollar speculations for electoral purposes, saying that doing so is unlawful.
Journalists challenged Mr. Emefiele on the expected effect of election spending on the value of the naira in relation to the dollar, and he was replying to their inquiries.
The Governor insisted that the central bank was keeping an eye on the situation and would keep using its tools for monetary policy (discretionary powers) to remove excess liquidity from the system when it thought banks might be trying to facilitate election spending or engage in foreign exchange speculation.
Speaking specifically about the use of forex for election purposes he warned those who might be considering this to avoid doing so as it was illegal.
“As for those who want to buy sic take naira from their account to buy dollars because of the election. I want to warn not advice that it is illegal to do so. Whereas it will sound more convenient to carry dollar because you could carry little dollars but with a lot of value in your pocket, but if the security agencies hold you, you know the implication of that’s.”
Additionally, he issued a warning, claiming that the CBN is in possession of monitoring technologies that it can use to follow any questionable forex transfers between accounts.
“We will continue from our own side to use our own apparatus through which we monitor movement of funds between customers or between banks and customers or from one bank to the other bank and any bank that we find in those form of transactions will be considered to be unauthorized or we considered to be illegal you can consider that your account will be placed on PND (Post No Debit).
Post no Debit (PnD) is a punitive tool used by the CBN to restrict the transfer of funds from any bank account in the country suspicious of being used illegally. When the restriction is placed, the account can not have any money transfered or withdrawn out of it for the duration it is under “PnD”.
Emefiele also cautioned potential allies that the CBN is a monster and will not think twice about using the PND to prevent account holders from accessing their funds for any banking transactions within the nation.
“You can see CBN has turned itself into a monster that uses an injurious tool to stop you from conducting illegal flows whether domestic or foreign currency. So, I will advice you not to get involved in unauthorized and illegal movement of money from your bank to your account or from one account to another account, or a currency conversion. When you do that and you are caught in that practice your account will be placed on PND.”
During routine banking exams, CBN Examiners frequently list suspect accounts on PND. When proven to be lacking, banks are also subject to significant fines. Court orders are also used to lift some PND accounts in the owners’ favor.