Nigeria: CBN governor Emefiele changes cashless policy after escaping arrest

By Eniola Akinkuotu
Posted on Thursday, 22 December 2022 17:26

Nigeria's Central Bank Governor Godwin Emefiele briefis the media during the MPC meeting in Abuja, Nigeria January 24, 2020. REUTERS

The Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, has changed a policy that would have curbed vote buying in next February’s election after facing one of his biggest battles ever.

On 8 December 2022, the governor in Daura, a sleepy town in Katsina, Northwest Nigeria, went to see President Muhammadu Buhari who was in his country home for a short break.

The purpose of the visit was to brief Buhari about a new policy he had announced a week prior, which would limit the daily withdrawal of money to N20,000 ($44.8), a plan that was quickly rejected by the parliament. Briefing journalists after the meeting, however, Emefiele said the cashless policy must be implemented.

Unknown to Emefiele, however, while he was briefing journalists, Nigeria’s secret police, the Department of State Services (DSS), were trying to convince the Chief Judge of the Federal High Court in Abuja to grant an order to detain him for 60 days for alleged terrorism financing and economic sabotage.

In the ex parte application, the DSS did not reveal Emefiele’s designation to the judge or give further detail about the investigation, but only said it was probing “one Godwin Emefiele”.

Apart from DSS, our intelligence alleges that the head of one of the chambers of the National Assembly is also part of the plot.

Sources within the court tell The Africa Report that upon hearing of the application, a call was put through to the attorney-general who denied knowledge of the development. Calls were also put through to the presidency and it was revealed that President Buhari knew nothing about the probe.

The angry judge subsequently lambasted the DSS for attempting to deceive the court and threw out the application.

With the plot effectively foiled, Emefiele’s supporters took to the streets to inform Nigerians about what had transpired and warned against future attempts to detain the CBN boss.

The protesters said the plan was to detain Emefiele for 60 days and while in custody, he would have been suspended to pave the way for a deputy governor to replace him and then reverse the policy.

Tochukwu Ohazuruike, a supporter of Emefiele, says the entire purpose of the plot to remove him was for political and financial benefits.

“The people in the plot are mighty, they are very, very strong people and they are indeed high and mighty in our government and in our country.

“Apart from DSS, our intelligence alleges that the head of one of the chambers of the National Assembly is also part of the plot. A presidential candidate of a major political party and ministers are [in] on the plot as well,” he says.

However, in a statement, the DSS says that while professionally discharging its mandate, it “pledged to remain focused and unbiased. It will not, by any means, succumb to propaganda, intimidation and the desperation of hirelings to undermine it”.

Vote buying

Emefiele has been in the news since October when he announced plans to redesign the three highest denominations of the naira – N200 ($0.45), N500 and N1,000. He said from 31 January, the notes currently in circulation would cease to be legal tender.

He claimed the rationale behind this was to curb counterfeiting and reduce the huge amount of money outside the banking system which was about 80%. This meant that politicians that had stockpiled money in their homes ahead of the 25 February election would have to return the money to the banks.

While they were still coming to grips with this, Emefiele announced that no individual would be allowed to withdraw more than N20,000 ($44.78) a day in cash from 9 January.

For a country where winners of elections are sometimes determined by the highest bidder, the policy coming just a few weeks to elections – to most discerning minds – was seen as a move to curb vote buying.

Many of our supporters in rural areas have no bank accounts. How will we cope?

“The money we share during elections is not just for vote buying. You know that banks are shut on election day and we have to help our supporters with refreshments, transportation and other things and that is why we need hard cash. Many of our supporters in rural areas have no bank accounts. How will we cope?” a politician tells The Africa Report.

This new policy immediately put Emefiele in the crosshairs of politicians, especially those in the ruling APC who felt as a government appointee, he ought to work for the victory of the ruling party.

Stamp duty allegation

The attacks against Emefiele intensified as a federal lawmaker, Gudaji Kazaure, said N89.09trn ($19.9bn) purportedly released from deductions by banks as stamp duty charges had been diverted by the CBN on Emefiele’s watch.

However, the apex bank quickly rubbished the report. The presidency again came to Emefiele’s defence, describing Kazaure’s allegation as laughable.

“It suffices to say that the entire net worth of the nation’s financial sector, the assets of the banking sector put together are not worth N50trn, not to talk of the kind of money he is talking about,” the presidency said.

Parliament summons Emefiele

The federal parliament also summoned Emefiele to explain the reason for the cashless policy. Both the Senate and the House of Representatives said the policy would affect the informal sector and those living in rural areas that lacked access to banks.

They therefore called on the CBN governor to suspend the policy until he visits the National Assembly to explain his reason for the policy.

On the day he was expected to appear before the federal lawmakers, however, Emefiele sent a letter, explaining that he had accompanied President Buhari on a trip to the US where the Africa Leaders’ Summit was held.

They subsequently asked the CBN boss to appear on a future date, but he again failed to do so, further infuriating the lawmakers.

Is Godwin Emefiele, Governor of [the] Central Bank, above the law? Who does he think he is?

The Speaker of the House, Femi Gbajabiamila, a protégé of Bola Tinubu, also visited President Buhari with a view to ensuring that the policy is stalled.

Tinubu’s men knock Emefiele

While a political solution was being sought, some members of the campaign council of the APC presidential candidate, Bola Tinubu, have gone on the offensive.

Femi Fani-Kayode, who heads the social media arm of the campaign, says Emefiele must surrender himself to the DSS.

“This is my personal opinion. Is Godwin Emefiele, Governor of [the] Central Bank, above the law? Who does he think he is? Can he fight the system? Can he disgrace the service? He was asked to report to the DSS to answer questions on terrorism & he refused to do so. What has he got to hide?” he says.

Earlier, Tinubu’s campaign spokesmen, Dele Alake and Bayo Onanuga, issued a statement lambasting media baron, Nduka Obaigbena, for supporting Emefiele when he was contesting for the presidency back in March.

“Here is a publisher who deployed his media group in aid of the immoral and illegal presidential ambition of a sitting governor of the Central Bank of Nigeria [CBN] even when this flagrantly violated and threatened the integrity of that critical institution,” the statement said.

Atiku campaign hails policy

Despite this, the campaign council of the main opposition Peoples Democratic Party (PDP) and its candidate, Atiku Abubakar, have praised the cashless policy. They insist that it will help to stifle the success of ‘bullion van’ politicians, an indirect jab at Tinubu who had two cash laden bullion vans on his premises on the eve of the 2019 presidential poll.

What is Emefiele’s interest in a free and fair election? He’s just a hypocrite.

“Ambitious politicians that run activities with bullion vans and raw cash are out to destroy the nation’s financial institutions, particularly, the CBN, for their selfish political interests,” Kola Ologbondiyan, a campaign spokesman says.

He further warned the APC against any attempt to arrest Emefiele. 

Emefiele bows to pressure

Amid these threats, Emefiele remained abroad and told lawmakers that he was attending to his health. With little options left, he suddenly announced major adjustments to the policy.

The weekly cash withdrawal limit is now N500,000 ($1,121) as opposed to the N100,000. Further, anyone who wishes to withdraw more than N500,000 from his or her personal account is free to do so provided the bank customer is willing to pay a processing fee.

“In the event of compelling circumstances where cash withdrawal exceeds the limits required for legitimate purposes, such requests will attract a processing fee of 3% and 5% for individuals and corporate organisations, respectively,” the apex bank said.

Omoyele Sowore, a presidential candidate, tells The Africa Report that Emefiele is also part of the rotten system that tried to consume him and thus must not be portrayed as some hero.

Sowore, who is the candidate of the African Action Congress, says politicians who want to buy votes on election day will still find a way to circumvent the system whether Emefiele reverses the policy or not.

The anger is very understandable because Emefiele did them dirty. He obviously wanted to save himself

“What is Emefiele’s interest in a free and fair election? He’s just a hypocrite. For starters, those who want to buy votes know how to circumvent the system. You can buy votes in a lot of ways,” he says.

Activist Deji Adeyanju in a chat with The Africa Report, said the Emefiele must be the most hated man by politicians as the policy would have made it difficult for them to buy votes.

“They had already stockpiled their homes with naira notes. The anger is very understandable because Emefiele did them dirty. He obviously wanted to save himself,” Adeyanju says.

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