Financial institutions in the country may be fined N5 million for hoarding the new naira notes. This was as enshrined in the Central Bank of Nigeria Act of 2007 and the Banks and other Financial Institutions Act of 2020.
As stated in the Banks and other Financial Institutions Act, 2020, the CBN governor may propose to alter, rescind or enforce fresh or more conditions on a licensed bank or financial institution after notifying the banks involved.
The Act noted that any bank that fails to comply with conditions is liable to a fine of at least N5 million and an extra N100,000 for each day of the compliance failure.
“Where the governor proposes to vary, revoke or impose fresh or additional conditions on a licence, the Governor shall, before exercising such power, give notice of his intention to the bank concerned and give the bank an opportunity to make representation to him thereon.
“Any bank which fails to comply with any fresh or additional condition imposed in relation to its licence is liable to (a) a penalty of not less than N5,000,000, and (b) an additional penalty of N100,000 for each day during which the fresh or additional condition is not complied with,” Section 5(4,5) of the Act read in part.
The document further notes that any bank director, manager, or officer who fails to ensure that compliance is observed is also guilty and is liable to at least three years imprisonment, or N2 million, or both.
Section 5(6) of the Act read, “Any person who, being a director, manager or officer of a bank fails to take reasonable steps to secure compliance with any of the conditions of the licence of the bank commits an offence and is liable on conviction to imprisonment for a term of not less than three years or a fine of not less than N2,000,000 or both.”
In the CBN Act 2007, it is an offence to hawk, sell or otherwise trade in naira notes, and anyone found guilty can face imprisonment for a term not less than six months or a fine of at least N50,000. Violators face both fines and imprisonment, according to the document.
Section 21(4) of the Act read, “It shall also be an offence punishable under Sub-section (1) of this section for any person to hawk, sell or otherwise trade in the Naira notes, coins or any other note issued by the Bank.”
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