CBN seeks powers to freeze accounts linked to criminals

The Central Bank of Nigeria is seeking statutory powers to freeze accounts linked to criminals in the country.

The CBN disclosed this in a presentation at a public hearing organised by the Senate on a Bill for an Act to Repeal the Banks and Other Financial Institutions Act (BOFIA) 2004 and re-enact the Banks and Other Financial Institutions Act 2020 on Wednesday.

The apex bank is also demanding the creation of a Credit Tribunal to strengthen credit recovery processes and enforcement of collateral rights in the country.

CBN’s Director Legal Services, Mr. Kofo Salam-Alada, in the presentation, said the 2004 BOFIA provided for the CBN governor “to apply to the court for orders to freeze accounts, which are deemed to be linked with criminal and other civil infractions.”

However, he noted that in the new bill, which has passed through the First and Second Readings, that provision was omitted entirely.

“This omission erodes the powers of the CBN and creates a huge gap in the regulatory and resolution framework.

“Therefore, we propose that the extant provisions should be reinstated,” he said.

Salam-Alada added that the creation of a Credit Tribunal would greatly enhance loan recovery in the nation’s banking industry.

“As part of measures to address the role of non-performing loans, we propose the creation of a Credit Tribunal.

“The overarching objective is to create an efficient regime for the recovery of eligible loans of banks and Other Financial Institutions (OFls) and enforcement of rights over collateral securities,” he said.