Financial experts on Monday said the
Federal Government’s move to freeze all accounts not covered by Bank
Verification Number (BVN) would check money laundering.
The financial experts told Newsmen
in Lagos while reacting to the court order by the Federal Government mandating
banks to freeze all individual and corporate accounts not covered by BVN. BVN
is a unique identification number that can be verified and used to transact
business across all the banking platforms in Nigeria.
A Federal High Court in Abuja
ordered the Central Bank of Nigeria (CBN) and the 19 commercial banks in the
country to disclose all accounts in their custody and the balances in such
accounts.
The court ordered the banks to
disclose the details of all such accounts, their owners and their proceeds in
their affidavit of compliance deposed to by their Chief Compliance Officers.
It also made an interim order
directing the banks to freeze all the said accounts by stopping “all outward
payments, operations or transactions’’ pending the hearing of the substantive
application seeking the forfeiture of the balances in the accounts to the
Federal Government. The banks were also directed to disclose “any investments
made with funds from these accounts without BVN in any products’’. Such
investments to be disclosed by the banks as directed by the court include
“fixed/term deposits and their liquidation and interest incurred, bank acceptances,
commercial papers and any other relevant information related to the transaction
made on the accounts’’.
Dr Uche Uwaleke, Head of Banking and
Finance Department, Nasarawa State University Keffi, said that compliance with
the court order would help to check fraudulent practices, including money
laundering. “I’m totally in support of the court order to freeze all individual
and corporate accounts in commercial banks not covered by the BVN. “It should
have even been made long before now considering that the deadline issued by the
CBN expired long ago,’’ Uwaleke said. He said that operating an account without
BVN violated the “know your customer’’ directive by the CBN as well as the
money laundering Act.
“Why should a bank operate a non-BVN
account except for fraudulent reasons? “So, compliance with the court order
will help to check fraudulent practices including money laundering,’’ Uwaleke
added. He said that it would also help to expose questionable sources of wealth
such as ones from crime like kidnapping and theft of public funds. “It will
boost the government’s fight against corruption, improve the country’s image
and promote investor confidence in Nigeria,’
’ he stated. Prof. SheriffdeenTella,
Professor of Economics, Department of Economics, Olabisi Onabanjo University,
Ago-Iwoye, Ogun, said that all accounts by now should have BVN unless an
illegal account. Tella said that it was wrong for banks to allow transactions
in such accounts within the last 18 months.
“If transactions have been taking place in
such accounts within the last 18 months, the bank itself will be in trouble,’’
Tella said. He said that it was right to execute the order to allow for
forfeiture of the illegal funds.
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