Nigeria News

The many sins of Lamido Sanusi

ABUJA — The Presidency yesterday explained that the suspension of the Governor of Central Bank, Sanusi Lamido Sanusi has nothing to do with his recent appearance at the Senate where he made startling allegations against the Nigerian National Petroleum Corporation.

Special Adviser to the President on Media and Publicity, Reuben Abati said his suspension was in connection with his recklessness and violation of extant laws of the Land.


Dr Abati who addressed state House correspondents to clear the air on the rumour making rounds that the Presidency was not comfortable with Sanusi’s recent utterances noted that “the president has had to take this decision as part of attempt to strengthen the CBN to ensure that the apex bank continues to be symbol for prudence, integrity and accountability”.

According to Abati, “Last year when the CBN submitted its financial statement for the year ended 31st  December 2012, a query was raised about some of the issues in the financial statement and the CBN governor was asked to offer some clarification with regards to these issues.

This was around first week of May 2013. A response came from the CBN which was then forwarded to the Financial Reporting Council of Nigeria. The Financial Reporting Council of Nigeria by its act  is empowered to review the accounts of the CBN and if there is cause for investigation to conduct such investigation. nd if there is need also to invite other bodies to further investigate, the law makes allowance for that and that took place. Some of the outcomes of that process relates to the issues raised about financial recklessness.

“If I may just draw attention to a few of them: the persistent refusal and negligence to comply with public procurement act in the procurement practices of the CBN; unlawful expenditure by the CBN on intervention projects across the country deploying huge sums of money as the CBN did under the watch of Mallam Sanusi without appropriation and outside the CBN’s statutory mandate. It is said that the expenditure of public funds of course by any organ of government must be based on clear legal mandate, prudent constraint and overriding national interest. And then, the financial infraction and act of financial recklessness committed by the CBN and reflected in its audited financial statement for 2012.

“The review by the “Financial Reporting Council of Nigeria rather than allay the fears of government further confirmed concerns about the untidy manner in which the affairs of the CBN were conducted.

“The question has also been raised on whether this has to do with the ongoing appearances in the National Assembly by the suspended CBN governor. I will like to state very clearly that this has nothing to do with that. I have given you the background so that you can see that this is the process.

“And indeed we look forward to a situation whereby Mr. Sanusi will continue to assist the legislature in their investigations and will continue to testify because what government is interested in really is transparency and accountability and anything that will further promote that objective is perfectly welcome,” he said.

Particulars of the infractions against Sanusi

Persistent refusal and/or negligence to comply with the Public Procurement Act in the procurement practices of the Central Bank of Nigeria.

(A) By virtue of Section 15 (1)(a) of the Public Procurement Act, the provisions of the Act are expected to comply to ‘all procurement of goods, works and services carried out by the Federal Government of Nigeria and all procurement entities.’ This definition clearly includes the Central Bank of Nigeria.

(B) it is however regrettable that the Central Bank of Nigeria, under your leadership, has refused and/or neglected to comply with the provisions of the Public Procurement Act (PPA). You will recall that one of the primary reasons for the enactment of the PPA was the need to promote transparency, competitiveness, cost of effectiveness and professionalism in the public sector procurement system.

(C) available information indicates that the Central Bank has over the years engaged in procurement of goods, works and services worth billions of Naira each year without complying with the express provisions of the PPA.

(D) by deliberately refusing to be bound by the provisions of the Act, the CBN has not only decided to act in an unlawful manner, but has also persisted in promoting a governance regime characterised by financial recklessness, waste and impunity, as demonstrated by the contents of its 2012 Financial Statements.

Unlawful expenditure by the Central Bank of Nigeria on ‘Intervention Projects’ across the country

(A) the unacceptable level of financial recklessness displayed by the leadership of the Central Bank of Nigeria is typified by the execution of ‘Intervention Projects’ across the country. From available information, the bank has either executed or is currently executing about 63 such projects across the country and has committed over N163billion on them.

(B) it is inexcusable and patently unlawful for any agency of government to deploy huge sums of money as the CBN has done in this case, without appropriation and outside CBN’s statutory mandate. It is trite that the expenditure of public funds by any organ of government must be based on clear legal mandates, prudent costing and overriding national interest.

Financial infractions and acts of financial recklessness committed by the Central Bank as reflected in its audited financial statements of 2012

(A) pursuant to Section 50 of the CBN Act 2007, a copy of the audited financial statements of the CBN for the year ended 31st December 2012 was sent to Mr. President. Based on the issues raised in the financial statement, a reinsertion was requested from you to enable a proper appreciation of the nation’s economic outlook.

(B) the response to this query was further referred to the Financial Reporting Council of Nigeria.

The review by the council, rather than allay the fears of government, further confirmed concern bout the untidy manner in which you have generally conducted the operations of the CBN.


Some of the salient observations arising from the review are:

(A) in a most ironical manner, it has become obvious that the CBN is not able to prepare its financial statements using applicable International Financial Reporting Standards (IFFS) whereas Deposit Money Banks that the CBN is supervising have complied with this national requirement since 2012.

Undoubtedly, this laxity on the part of our apex bank, apart from calling to question its capacity for proper corporate governance, is capable of sending wrong signals to both domestic and international investors on the state of the Nigerian economy.

(B) the provisions of the Memorandum of Understanding (MOU) signed by the CBN and other Deposit Money Banks on Banking Resolution Sinking Fund have been breached in a material manner. For example, a Board of Trustees (BOT) to manage the Fund has not been constituted since 2010 when it was established. The CBN has however continued to utilise the Fund for certain operations without approval of the said BOT.

(C) contrary to section 34 (b) of the CBN Act 2007 which provides that the CBN shall not, except as provided in Section 31 of the Act, inter alia, purchase the shares of any corporation of company, unless an entity set up by the approval or authority of the Federal Government,m CBN in 2010, acquired 7% shares of International Islamic Management Corporation of Malaysia to the tune of N0.743 billion. This transaction was neither brought to Mr. President’s attention nor was a board approval obtained before it was entered into.

(D) the CBN has failed or refused to implement the provisions of the Personal Income Tax (Amendment) Act 2007. Accordingly the Pay-As-You-Earn (PAYE) deductions of its staff are still being computed in accordance with the defunct Personal Income Tax Act 2004, thus effectively assisting its staff to evade tax despite the generous wage package in the CBN, relative to other sectors of the economy.

(E) the CBN had an additional brought forward to General Reserve Fund of N16.031 billion in 2012 but proceeded on a voyage of indefensible expenses in 2012 characterised by inexplicable increases in some heads of expenditure during the year. Examples include:

1. The bank spent N3.086 billion on “promotional activities” in  2012 (up from N1.084 billion in 2011). The bank spent this sum even when it is not in competition with any other institution in Nigeria;

2. The CBN claimed to have expended N20.202 billion on ‘Legal and Professional Fees’ in 2011 beyond all reasonable standards of prudence and accountability;

3. Between expenses on ‘Private Guards’ and ‘Lunch for Policemen’, the CBN claimed to have spent N1.257 billion in 2012;

4. While Section 6(3)(c) of the CBN Act 2007 provides that the board of the CBN is to make recommendations to Mr. President on the rate of remuneration to Auditors, the bank has consistently observed this provision in breach and even went to the extent of changing one of the Joint External Auditors without notifying the office of the President.

Anthony-Claret Onwutalobi
Anthony-Claret Onwutalobi
Anthony-Claret is a software Engineer, entrepreneur and the founder of Codewit INC and CEO of Portia Web Solutions. Mr. Claret publishes and manages the content on Codewit Word News website and associated websites. He's a writer, IT Expert, great administrator, technology enthusiast, social media lover and all around digital guy.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.