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CBN’s cash withdrawal policy is illegal – Falana

It is embarrassing that the Central Bank of Nigeria has been making announcements without any regard to the Constitution and other relevant laws on the national economy

Human rights lawyer, Femi Falana has described the new cash withdrawal policy of the Central Bank of Nigeria where individual and corporate entities are limited to weekly withdrawals of N100,000 and N500,000 weekly is not only illegal, but unconstitutional.

Falana insists that the Nigerian constitution makes provision of a limit of  five milion for individuals and N10 million for corporate entities in the Money Laundering Act. He said the announcement by the CBN in embarrasing as the apex bank did not consult the constitution before it made the new policy announcement. He therefore called on President Muhammadu Buhari to direct CBN  withdraw the illegal policy.

The statement reads:

MAXIMUM WITHDRAWAL LIMIT IS N5 MILLION IN NIGERIA

The Central Bank of Nigeria (CBN) has ordered Deposit Money Banks (DMOs) and other financial institutions to ensure that weekly over-the-counter (OTC) cash withdrawals by individuals and corporate entities do not exceed N100,000 and N500,000, respectively. The regulatory directives will take effect nationwide from January 9, 2023 has limited the maximum cash withdrawal per week via Automatic Teller Machine (ATM) to N100,000 subject to a maximum of N20,000 cash withdrawal per day.

It is embarrassing that the Central Bank of Nigeria has been making announcements without any regard to the Constitution and other relevant laws on the national economy. It is particularly worrisome that the Governor of the Central Bank of Nigeria has purportedly placed a limitation on cash withdrawals in Nigeria in complete defiance of section 2 of the Money Laundering Act, 2022 which provides as follows:

“2.(1) No person or body corporate shall, except in a transaction through a financial institution, make or accept cash payment of a sum exceeding (a)5,000,000 or its equivalent, in the case of an individual ; or (b) N10,000,000 or its equivalent, in the case of a body corporate.

(2) A person shall not conduct two or more transactions separately with one or more financial institutions or designated non-financial businesses and professions with intent to (a) avoid the duty to report a transaction which should be reported under this Act ; and (b) breach the duty to disclose information under this act by any other means.”

Since the Money Laundering Act 2022 (which has fixed maximum cash withdrawal to N5 million) has not been amended the limitation of cash withdrawal of not more than N20,000 per day and N100,000 per week fixed by the Central Bank of Nigeria is illegal, null and void in every material. We urge the Nigerian people to ignore the illegal announcement.

Femi Falana SAN

However, we are compelled to call on President Muhammadu Buhari to direct the management of the CBN to withdraw the illegal guideline and stop announcing more policies that are designed to sentence poor citizens to more excruciating economic hardship.

FEMI FALANA SAN,
The Chair,
Alliance on Surviving Covid 19 and Beyond (ASCAB)

December 12, 2022

 

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