Citibank denies involvement in MTN ‘illegal’ money transfer

Citibank denies involvement in illegal transfer of money for MTN
Citibank denies involvement in illegal transfer of money for MTN
Citibank denies involvement in illegal transfer of money for MTN

Citigroup has denied being involved in any illegal foreign currency transfer on behalf of MTN Group, according to a presentation the United State bank gave to the National Assembly.

Nigeria is investigating whether South African telecoms company MTN unlawfully repatriated $13.92 billion from Nigeria between 2006 and 2016.

“We wish to state categorically that Citibank Nigeria Limited was at no time involved in any illegal foreign currency repatriation on behalf of MTNN (MTN Nigeria) or any other customer,” Citibank said in a presentation to Assembly last week.

Similarly, MTN has denied that it broke Nigeria’s currency transfer rules, the South African telecoms firm said on Friday, denying allegations it illegally repatriated $14 billion in a row analysts say exposes the inherent risk of investing in frontier markets.

Deal of the day

Nigeria’s upper house of parliament last month agreed to investigate whether Africa’s biggest telecoms company unlawfully repatriated $13.92 billion between 2006 and 2016.

On Thursday, a committee of Nigerian lawmakers summoned MTN , Nigerian trade minister Okechukwu Elenemah and four banks for an “investigate hearing” into the claims.

The crux of the allegation is that MTN did not obtain certificates declaring it had invested foreign currency in Nigeria within a 24 hour deadline stipulated in a 1995 law, and so the repatriation of returns on those investments was illegal.

Nigeria is MTN’s most lucrative market out of the 22 countries the company operates in across Africa, Asia and the Middle East but it is becoming increasingly problematic.

MTN runs Nigeria’s largest mobile phone network which generates a third of the company’s revenue.

The fund transfer issue has battered MTN’s shares, which were near a 6-1/2 year low at 105.91 rand on Friday.

Ferdi Moolman, chief executive of MTN Nigeria, said in a statement on Friday that when banks issued “certificates of capital importation (CCI)” for funds it brought into Nigeria after the deadline they had done so with central bank approval.

“Often for various reasons such as not having all the required documentation, for instance, it is not possible to issue a CCI within 24 hours, and the Central Bank of Nigeria’s Forex Manual contemplates such situations by asking that the banks refer to the CBN for approval,” Moolman said.

“As such, the CBN has the authority, and indeed we believe, approved the banks’ applications to issue CCIs outside the recommended time frame,” he said.

The motion initially put forward by Nigerian Senator Dino Melaye claims MTN requested the certificates at least five years after bringing in the hard currency.