The raid of bureau de change (BDC) operators continued on Wednesday with the operatives of the Economic and Financial Crimes Commission (EFCC) storming major hubs in Lagos, Abuja, Ibadan, Kano and Aba.
Consequently, the NAFEX rate depreciated by 2.89% to close at N1,621.41/USD, while the BDC rate depreciated by 0.82% to close at N1,840/USD. Findings by our correspondent revealed that the operatives stormed the Allen Avenue hub around 12 pm on Wednesday and arrested no fewer than 10 people.
In Ilorin, a BDC operator at Kwara Hotel confirmed to our correspondent that all the operators closed shops on hearing the news of the raid in Lagos, Abuja, and Kano. Similarly, operators in the famous Kano currency exchange market, WAPA, are said to have been apprehended by men of the EFCC on Wednesday afternoon.
According to an eyewitness, Malam Isma’ila Zico, officials of the EFCC were at the market in earlier hours of Wednesday in plain clothes, adding that it was after the market had filled up with activities that the men of the commission struck and apprehended some currency exchange operators.
When contacted, WAPA currency exchange market chairman, Alhaji Sani Salisu Dada, confirmed the raid, adding that the operatives of the EFCC were in the market to address the issue of dollar hoarding and operators that have not registered as certified bureau de change operators. In Abuja, the security operatives arrested over 50 operators at the Zone 4 area of the FCT.
Investigation also revealed that the Nigerian government is considering blocking the online platforms of Binance and other crypto firms to avert what it considers continuous manipulation of the forex market and illicit movement of funds, officials with knowledge of the policy option.
The move follows reports that currency speculators and money launderers were using them to execute criminal activities. It is strongly believed that what goes on the Binance platform gives the dollar a fake value against the naira which then sets a frenzy and misleads the market.
“This fake price is then often quoted by BDCs who raise their prices to meet the Binance benchmark even without any corresponding demand in that segment,” a source said. A senior executive at the Central Bank of Nigeria (CBN) described as “troubling” the bearish downward trade of the naira against the dollar in the last 10 days, attributing it to artificial devaluation caused by the speculative sites.
Binance has had similar accusations of currency manipulation and unethical conduct leading to sanctions in many countries and an ongoing lawsuit in the United States. If the government decides to invoke a ban on the digital asset trading site, it would be treading the path of countries like Malaysia, France, and Malta, among others.
The Office of the National Security Adviser (ONSA) had announced Tuesday that it was joining forces with the Central Bank of Nigeria to clamp down on currency speculators and economic saboteurs. Binance explains actions on trading by Nigerians
Binance in its reaction to the latest development says it has taken some actions to adjust trading on its platform by Nigerians to address what it described as an unusual currency movement. While many Nigerians have been complaining of facing restrictions with buying and selling USDT on the platform since Tuesday, Binance said its action was “to protect users and prevent any abuse.”
The company also distances itself from the forex debacle in Nigeria, saying its platform is “market-driven and not intended to be a proxy for currency pricing in Nigeria.”
ABCON throws weight behind CBN. The president of the Association of Bureau de change of Nigeria (ABCON), Aminu Gwadabe in his reaction to the raid said: “We support any sanitization that can remove street trading. There is no place on earth where you see rampant street trading of FX, so we’re in support of it.”
Gwadabe said the association is also putting reforms in place and is asking the CBN to support its process. “We are revolutionising the entire retail exchange market because so many things affect us licensed Bureau de ‘Change Operators.
“In three weeks, we will automate the system. We already have the automation system in place just for the CBN to give us the request for “No Objection” that is all we are asking. We already built the automation platform. We have sent it to them, let them give us approval for no objection, that’s all we need, then we go live.
Source: Daily Trust
