Nigeria central bank slaps $16m fine on banks for MTN capital repatriation

Nigeria’s central bank on Wednesday announced that it had slapped a fine of 5.8 billion naira on four banks for their roles in MTN illegal fund repatriation.

The banks involved are Standard Chartered Bank, Stanbic IBTC, Citibank and Diamond Bank, all are to pay different sums in fines imposed.

The central bank added that the banks are to refund the full amount of $8.134 billion involved in the said transaction which it said was in breach of Nigeria’s forex regulations.

#CBN Slams N2.4bn fine on Standard Chartered, N1.8bn on Stanbic IBTC, N1.2bn on Citibank, N0.25bn on Diamond Bank. All to also refund a total of $8.134bn for breaching Nigeria’s forex regulations on MTN’s illegal capital repatriation.

— Central Bank of Nigeria (@cenbank) August 29, 2018

MTN’s headache in Nigeria has made news headlines for better part of 2016 and 2017. They were initially hit with a $5.2 bn fine in October 2015 by the Nigerian regulator for failure to cut off 5.1 million unregistered SIM cards as requested by the government.

Security was cited as being behind the move, over fears that Boko Haram insurgents were using unregistered SIMs to plan and execute attacks in the remote northeast.

In December 2015, the fine was reduced to $3.4 billion, then cut further in June last year to $1.7 billion, which at the time was equivalent to 330 billion naira. The payment is staggered over three years.

In March 2017, MTN said it had paid nearly $100m of the $1.7 bn fine. “MTN has paid N30bn ($98m, 92 million euros) as part of the fine,” Tony Ojobo, spokesman for Nigeria Communication Commission (NCC) told AFP at the time.

“The payment is in furtherance of the agreed timetable for payment of the total fine.” He said MTN had already paid N80bn of the total fine of N330bn. Ojobo said MTN was expected to pay the next tranche of the fine “based on the payment schedule agreed by the two parties.”

MTN is the largest mobile phone operator in Nigeria, which accounts for around one-third of the company’s revenues. The company had at a point threatened to pull out of Nigeria during the dispute over unregistered SIM cards.