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Nigerian Senate withdraws report exonerating MTN

Nigeria's Senate has withdrawn a report that largely exonerated South African telecoms giant MTN of accusations of illegally repatriating $14 billion and rebuked the Nigerian central bank for regulatory failures.

The report, presented to the Senate on Thursday and reviewed by Reuters, was almost immediately sent back for further work because it did not capture possible infractions by all stakeholders, two people familiar with the matter said.

Parliament's upper house agreed in September to investigate whether Africa's biggest telecoms firm unlawfully repatriated $13.92 billion from Nigeria - its most lucrative market which generates a third of its revenue - between 2006 and 2016.

MTN, which has denied any wrongdoing, could not immediately be reached for comment.

The crux of the allegation is that MTN did not obtain certificates declaring it had invested foreign currency in Nigeria within a 24-hour deadline stipulated in a 1995 law, making the repatriation of returns on the investments illegal.

The Senate formed a committee to investigate the allegations against the South African company, the Central Bank of Nigeria (CBN) and commercial lenders such as Nigeria's Stanbic IBTC Bank PLC.

The committee's report did not recommend any punitive measures against MTN.

Instead, the report rebuked Nigeria's central bank for its failure to monitor fund transfers to and from the country, calling its oversight of banks "inadequate".

The report recommended that the Senate "condemn the Central Bank of Nigeria for failing in its duty" to address problems with monitoring foreign exchange transfers.

 

Findings Dismay

The CBN's duty is to correct and, if needed, sanction banks and their customers for any wrongdoing, which it never did, said the report, adding that the central bank never testified to the committee that there had been any infractions.

By never applying sanctions, the CBN had lent credence to the commercial banks' argument that they were not breaking any rules by transferring foreign currency, the report said.

A CBN spokesman was not immediately available for comment.

However, the report also urged the central bank to "sanction Stanbic IBTC for improper documentations in respect of capital repatriation and loan repayments amounting to $388,195,183 and $199,440,952 respectively".

Stanbic IBTC is "waiting for the formal communication from the Senate committee on the matter, so that we can obtain clarity on this issue," said a spokesman for the bank.

The report findings were met with dismay by some Senators.

They did not understand why the report largely condemned the central bank while MTN and commercial banks that transferred money overseas were barely reprimanded, said one of the people familiar with the investigation.

The document was a poorly investigated report full of holes, the person said, speaking on condition of anonymity.

It has now been withdrawn for consultations and further legislative work, said the other person with knowledge of the investigation.

The currency transfer row is just the latest regulatory issue to affect MTN in Nigeria.

MTN paid the government 30 billion naira ($98 million) in part settlement of a 330 billion naira fine for not disconnecting unregistered SIM cards, an MTN source told Reuters in March.

 

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Cameroon Concord  is an online publication covering and reporting on  local and world news, sports, entertainment, politics, business, and religious news. Serving Cameroonians .

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