Forex fraud: EFCC summons foreign firms as $347bn funds investigation thickens

According to media reports, the Economic and Financial Crimes Commission is examining at least $347 billion in funds provided to Nigerian corporations between January 2014 and June 2023.

This comes as new evidence suggests that the anti-graft bureau has expanded its forex allocation investigation to include some international corporations operating in Nigeria.

However, The PUNCH analyzed Central Bank of Nigeria statistics on Wednesday and discovered that local and international corporations in Nigeria received at least $347.49 billion from the central bank to meet their foreign exchange demands and obligations over a 10-year period.

The information was included in the sectoral use of the CBN’s FX data. Sectoral utilisation of foreign exchange indicates how foreign exchange is allocated and used across the economy’s various sectors or businesses.

The occurrence occurred against the backdrop of the EFCC’s investigation into forex allocations to the Dangote Group and 51 other companies under the immediate past Governor of the Central Bank of Nigeria, Godwin Emefiele.

According to media reports on Wednesday, the EFCC was focusing its attention on 52 companies because they received the largest portion of the $347 billion throughout the timeframe.

However, until of press time on Wednesday, the amount received by Emefiele’s 52 top FX allocation grantees during the review period was unknown.

Meanwhile, an examination of the CBN’s quarterly data bulletin revealed that the sectors that benefited from forex allocation in the import category were industrial, food items, manufactured products, transportation, agricultural, minerals, and oil.

Other industries included communication, construction and related engineering, distribution, education, the environment, finance, health, and social services, tourism and travel, recreational, cultural, and sporting services.

A breakdown of the allocation per year showed that the bank disbursed $65.99bn in 2014, $44.6bn in 2015, $25.5bn in 2016, $27.64bn in 2017, $40.81bn in 2018, $43.99bn in 2019, $28.24bn in 2020, $16.4bn between January 2021 and September 2021.

Also, $17.38bn was disbursed between October 2021 and March 2022, while $36.88bn was given between April 2022 and June 2023.

Under the imports category, the industrial sector got the most forex allocation, with $69.71bn in the period being reported. Others include food products ($24.88bn), manufactured products ($32.73bn), transport sector ($6.67bn), agricultural sector ($2.83bn), minerals (2.88bn), and oil sector ($37.46bn).

Under the invisible category, financial services ($136.54bn) got the most forex allocation. Others include business services ($13.47bn), communication services ($3.08bn), construction and related engineering services ($147.71m), distribution services ($257.99m), education services ($4.98bn), environmental services ($40,000), health-related and social services ($31.03m), tourism and travel related services ($721.54m), recreational, cultural and sporting services ($3.18m), transport services ($7.32bn), and other services not included elsewhere ($3.79bn).

On January 4, 2023, operatives of the EFCC visited the headquarters of Dangote Industries Limited in Ikoyi, Lagos, as part of the ongoing investigation into the alleged abuse of the foreign exchange allocations by Emefiele.

Emefiele and his activities as the apex bank governor are currently under investigation by a Special Investigator on the CBN and Related Entities, Jim Obazee. In July 2023, the President, Asiwaju Bola Tinubu, appointed a special investigator to probe the Central Bank of Nigeria.

The investigator, Obazee, was tasked with investigating the apex bank and key Government Business Entities.

Obazee submitted the report of the investigation sometime in December 2023.

According to reports, 52 companies have been directed to provide documents supporting the allocation and utilisation of foreign exchange sold to them at official rates in the last 10 years.

The EFCC had demanded that the firms submit their Form A and Form M, which detailed their forex allocations between 2014 and June 2023.

Before now, Dangote Industries had, in November 2023, denied allegations that it was involved in forex malpractices estimated at $3.4bn and allegedly facilitated by Emefiele.

The conglomerate refuted claims that the money was funnelled to its non-Nigerian subsidiaries, prompting illicit financial flows and round-tripping.

In a rebuttal, Dangote Industries referred to past approvals granted by the CBN between 2010 and 2018, which allowed it to purchase forex totalling $3.76bn for the funding of its projects across Africa, of which it said only 47.70 per cent was utilised.

The company stated that forex for its investment undertakings was sourced from the interbank market, with all transactions supported by Letters of Credit in line with international standards.

Dangote Group had since stated that it was cooperating with the EFCC.

The firm said, “We remain committed to providing the EFCC with all necessary information and cooperation.”

According to reports, some companies affected by the EFCC’s directive have complied, while several others asked for time to get the proper documents.

Following its raid on Dangote Group, the EFCC has reportedly written to over 85 entities comprising corporate organisations and individuals over an ongoing investigation into alleged fraudulent foreign exchange allocations under Emefiele.

Unconfirmed reports claimed Emefiele might face an amended charge to include discoveries in the ongoing probe of forex transactions under his probe.

According to reports, the anti-graft agency has summoned senior officials of the affected entities and asked them to provide detailed documents of their foreign exchange transactions covering the last 10 years.

Forex scarcity has plagued the Nigerian economy in recent years, with the Central Bank of Nigeria owing FX backlogs and more.

This has led to the shutting down of many firms. About five multinationals have closed down operations, fully or partially, in the last 10 months. One of the firms, Procter & Gamble, stated that it had become increasingly difficult to operate in Nigeria.

The Chief Financial Officer of the group, Andre Schulten, said, “The other reality that arises in some of these markets is that it gets increasingly difficult to operate and create U.S dollar value. So, when you think about places like Nigeria and Argentina, it is difficult for us to operate because of the macroeconomic environment.”

Foreign firms’ probe

Amidst the ongoing probe, information reaching The PUNCH suggests that the EFCC may have started investigating some foreign firms for import and export violations.

According to The PUNCH’s findings, some of the foreign firms currently under its radar are Crane Currency Limited, Gleseck+Deverint GmbH, De La Rue Ltd, Oberthur Fiduclaire SAS, and Orelll Fussli.

This was contained in an internal memo of the anti-graft agency, which was signed by the Director of Operations, Hadiza Junaidu, and titled ‘Request for Information,’ and with reference number CB:4000/EFCC/DOPS/VOL.28/104, and dated December 21, 2023.

The memo read in part, “I am directed to request that you check the records of cases referred to your respective commands/sections for investigation and confirm whether the under mentioned foreign companies has/is being investigated for import/export violations or any other offence.

“i. Crane Currency Limited ii. Gleseck+Deverint GmbH iii. De La Rue Ltd iv. Oberthur Fiduciaire SAS v. Orelll Fussli”

While directing its recipients to act “urgently” on the memo, the EFCC director listed the distribution list to include zonal commanders and heads of operations.

It is unclear how soon the EFCC will end the forex allocation probe.

Credit: Punchng