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EFCC Probes $347 Billion Forex Allocations to Local and Foreign Companies in Nigeria

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EFCC

The Economic and Financial Crimes Commission (EFCC) has launched an extensive investigation into the allocation of at least $347 billion to various companies operating in Nigeria between January 2014 and June 2023.

Recent revelations indicate that the EFCC’s scrutiny has now extended to encompass certain foreign firms conducting business within Nigeria.

Upon analyzing data obtained from the Central Bank of Nigeria, it has been disclosed that both local and foreign entities received a cumulative total of $347.49 billion from the apex bank.

This allocation was intended to facilitate their foreign exchange needs and meet financial obligations over the past decade.

The breakdown of this information delves into the sectoral utilization of the Central Bank of Nigeria’s forex data, providing insights into how foreign exchange was allocated and utilized across various sectors and industries within the nation’s economy.

This development unfolds against the backdrop of the EFCC’s ongoing investigation into forex allocations, particularly those directed towards Dangote Group and 51 other companies during the tenure of the immediate past Governor of the Central Bank of Nigeria, Godwin Emefiele.

Dangote Industries, a conglomerate implicated in alleged forex malpractices amounting to $3.4 billion, has vehemently denied these allegations.

In November 2023, the conglomerate refuted claims that the funds were funneled to its non-Nigerian subsidiaries, resulting in illicit financial flows and round-tripping.

Dangote pointed to Central Bank of Nigeria approvals from 2010 to 2018, permitting $3.76 billion forex for African projects, of which 47.70 percent was utilized, sourced from the interbank market with Letters of Credit.

In response to the ongoing investigation, Dangote Group has pledged to collaborate with the anti-graft agency, stating, “We remain committed to providing the EFCC with all necessary information and cooperation.”

Numerous companies affected by the EFCC’s directive have reportedly complied, while others have requested additional time to gather the necessary documents.

Following the raid on Dangote Group, the EFCC has issued summonses to senior officials of the entities, seeking detailed foreign exchange transaction documents spanning the last 10 years.

The investigation has expanded to include foreign firms like Crane Currency Limited, Gleseck+Deverint GmbH, De La Rue Ltd, Oberthur Fiduciaire SAS, and Orelll Fussli.

This development arises amidst the ongoing forex scarcity impacting Nigeria’s economy, and unconfirmed reports suggest that Godwin Emefiele may face amended charges based on the ongoing discoveries.

The EFCC, through an internal memorandum, has officially sought information from relevant entities as it intensifies efforts to unravel potential forex irregularities.

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Naira

Naira Falls Across Multiple FX Windows as Trump Emergence Boost Dollar Value

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Naira Exchange Rates - Investors King

The Naira weakened to N1,681 per Dollar on Wednesday, November 6 in the official foreign exchange market, the Nigerian Autonomous Foreign Exchange Market (NAFEX) as the American Dollar strengthened in the global market following the emergence of Donald Trump as the US president.

The local currency fell by N10.33 or 0.61 percent to close at N1,681.65/$1 compared with Tuesday’s closing rate of N1,671.32/$1.

The daily supply of FX as measured by secondary data from FMDQ Securities Exchange Limited indicated that turnover slumped by $21.99 million or 10.1 percent to $196.78 million from $218.77 million.

The decline in supply comes as the Central Bank of Nigeria (CBN) limited the sale of forex in order to regulate cash sales in the FX market to ensure stability and compliance.

Also, the emergence of Donald Trump as the next US president made the Dollar stronger and weakened a host of other currencies, like the Naira.

The market will be looking forward to Trump’s potential policies and what it would mean for the global economy.

However, the Naira weakened in its value against the Pound Sterling in the official market by N8.74 to sell at N2,169.37/£1 compared with the preceding session’s N2,160.63/£1.

It closed flat against the Euro in the midweek to trade at the rate of N1,819.86/€1.

The local currency also weakened across the Dollar, Pound Sterling, and the Canadian Dollar in the black market.

The Naira lost N7.38 against the greenback to close at N1,715.73 to the US Dollar compared to N1,708.35/$1 it closed on Tuesday.

The Naira lost N3.33 to sell at N2,219.79/£1 compared with the preceding session’s N2,216.46/£1 and against the Canadian Dollar as it depreciated further by N6.61 to close at N1,231.23 per Canadian Dollar, compared to Tuesday’s N1,224.62 per CAD.

However, it followed a different pattern against the Euro as it appreciated N4.48 to quote at N1,860.09/€1 versus the previous day’s rate of N1,864.57/€1 and it extended losses

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Forex

Iran’s Currency Plummets to Historic Low Amid Trump’s Return to the White House

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Iran’s currency fell on Wednesday to an all-time low as Donald Trump clinched the U.S. presidency again, signaling new challenges ahead for Tehran as it remains locked in the wars raging in the Middle East.

The rial traded at 703,000 rials to the dollar, traders in Tehran said. The rate could still change throughout the day. Iran’s Central Bank could flood the market with more hard currencies as an attempt to improve the rate, as it has done in the past.

The slide comes as the rial already faces considerable woes over its sharp slide in value — and as the mood on the streets of Tehran among some darkened.

“One-hundred percent he will intensify the sanctions,” said Amir Aghaeian, a 22-year-old student. “Things that are not in our favor will be worse. Our economy and social situation will surely get worse.”

He added: “I feel the country is going to blow up.”

In 2015, at the time of Iran’s nuclear deal with world powers, the rial was at 32,000 to $1. On July 30, the day that Iran’s reformist President Masoud Pezeshkian was sworn in and started his term, the rate was 584,000 to $1.

Trump unilaterally withdrew America from the accord in 2018, sparking years of tensions between the countries that persist today.

Iran’s economy has struggled for years under crippling international sanctions over its rapidly advancing nuclear program, which now enriches uranium at near weapons-grade levels.

Pezeshkian, elected after a helicopter crash killed hard-line President Ebrahim Raisi in May, came to power on a promise to reach a deal to ease Western sanctions.

Iran downplays US election impact amid tensions

However, Iran’s government has for weeks been trying to downplay the effect on Tehran of whoever won Tuesday’s election in the United States. That stance continued on Wednesday with a brief comment from Fatemeh Mohajerani, a spokeswoman for Pezeshkian’s administration.

”The election of the U.S. president doesn’t have anything specifically to do with us,” she said. “The major policies of America and the Islamic Republic are fixed, and they won’t heavily change by people replacing others. We have already made necessary preparations in advance.”

By midday Wednesday in the Middle East, Donald Trump was elected the 47th president of the United States in a remarkable political comeback.

Tensions still remain high between the nations, 45 years after the 1979 U.S. Embassy takeover and 444-day hostage crisis that followed.

Iran remains locked in the Mideast wars roiling the region, with its allies battered — militant groups and fighters of its self-described “Axis of Resistance,” including the militant Palestinian Hamas, lebanon’s Hezbollah and Yemen’s Houthi rebels.

Israel is pressing its war in the Gaza Strip targeting Hamas and its invasion of Lebanon amid devastating attacks against Hezbollah. At the same time, Iran still appears to be assessing damage from Israel’s strikes on the Islamic Republic on Oct. 26 in response to two Iranian ballistic missile attacks.

Iran has threatened to retaliate against Israel — where U.S. troops now man a missile defense battery.

Mahmoud Parvari, a 71-year-old taxi driver in Tehran, did not mince his words when discussing Trump.

“I feel like I’m seeing the devil,” he said. “He looks like Satan, his eyes are like Satan and his behavior is like a mad man.”

But another taxi driver, who only gave his last name as Hosseini, offered a more pragmatic view.

“If it helps my country I would definitely” make a deal with Trump, he said. “It doesn’t matter if it’s Trump or anyone else. After all he is a human being.”

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Naira

Naira Rises on Dollar at NAFEM, Black Market as American Currency Weakens Globally

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NAIRA - Investors King

The Naira rose at the official market, the Nigerian Autonomous Foreign Exchange Market (NAFEM) as well as at the unofficial parallel market on Tuesday, giving a lifeline to the local currency which latched on to a weaker US Dollar in the global market.

The local currency gained 0.33 percent on the US Dollar at the official market to exchange at N1,671.32 /$1 on Tuesday, November 5 amid an improvement in supply at the official market.

The local currency rose on the American currency by N5.58 versus N1,676.90/$1 which it closed at the previous session on Monday.

Data showed a jump in supply as the turnover published on the FMDQ Group website stood at $218.77 million. This indicated that the session’s turnover fell by 175.3 percent, indicating an appreciation of $139.30 million compared to the $79.47 million published in the last trading session.

In the black market, the Naira added 52 Kobo against the greenback to close at N1,708.35 to the US Dollar compared to N1,708.87/$1 it closed on Monday.

Traders had adjusted their position, leading to a weaker position for the Dollar as voters went to the polls to choose the 47th president of the US.

There was a flat outcome for the Naira against the Pound Sterling but it depreciated against the Euro in the official market. The domestic currency closed on the British currency at N2,160.63/£1.

Meanwhile, against the Euro, the Nigerian currency closed at N1,819.86/€1 versus N1,816.40/€1, indicating an N3.46 depreciation.

The Naira gained against the British currency in the black market as it added by 93 Kobo to sell at N2,216.46/£1 compared with the preceding session’s N2,217.39/£1.

However, it followed a different pattern against the Euro as it depreciated N1.65 to quote at N1,864.57/€1 versus the previous day’s rate of N1,862.98/€1 and it extended losses against the Canadian Dollar as it depreciated further by N2.29 to close at N1,224.62 per Canadian Dollar, compared to Monday’s N1,222.33 per CAD.

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