Godwin Emefiele, the Governor of Nigeria’s Central Bank was suspended because he could not present the audited accounts of the bank from 2019 up to date, InsideBusinessNG investigation has revealed.
An audited account is a financial record that have been checked by a chartered accountant as being a true and correct record of the financial operations and position of an organisation .
Emefiele’s suspension which sources within the Aso Villa, Nigeria’s seat of government, the intelligence community, and the apex bank said is a raging fire, is currently making many in both the private and the public sectors uncomfortable, and may also affect the new CBN Acting-Governor, Folasodun Shonubi whom they alleged, does not merit the position.
They alleged Shonubi is at the center of the recent Stamp Duty scandal that rocked the apex bank. The new Acting-Governor is also alleged to be involved in the jumbo insurances of the CBN which premiums were allegedly inflated by billions of Naira during Emefiele’s tenure.
They also alleged that Shonubi favoured some insurance brokerage firms that are involved in the cover for the apex bank’s risks. These are minuses for Shonubi according to people that are familiar with the issues.
Findings by InsideBusinessNG showed that in the first week of this new administration and during the heat of the subsidy removal, President Bola Tinubu had asked Emefiele for a comprehensive report of his administration from 2016 to 2023.
Although a report was submitted for the period, it was, however, said to be exclusive of some vital information required for the presidency to take a decision on the measures to cushion the impacts of subsidy removal.
InsideBusinessNG’s investigations further revealed that another query was issued, bothering on the apex bank’s financial status between 2019 and 2022 with a specific request for the CBN’s audited accounts for the period. These are parts of the vital information which the first report by Emefiele omitted.
This query, it was gathered, threw the entire CBN management off balance because both KPMG and Ernst & Young, the two auditors to the CBN, had in January confessed to the Department of State Service (DSS) during its investigation of the apex bank, that the audited accounts from 2016 to 2021 were all fraudulently prepared and should not be relied on for any decision. Consequently, they had allegedly agreed that the financial statements of the CBN from 2016 to 2021 be withdrawn and all be re-issued.
InsideBusinessNG in February reported that the apex bank has no audited account for the Year 2022 despite the N300 million part-payment of fees to the two auditors.
The inability to present the financial statement was gathered to have created confusion for Emefiele, who, allegedly told the Presidency that the documents were in Lagos and so was excused to go and get them. It was during this period that sources in the CBN said he wanted to flee the country, leading to his arrest.
However, in the confused state of Emefiele, the Acting-Governor was alleged to have indiscreetly informed the presidency that the apex bank does not have the report being asked for, adding that Emefiele won’t be able to provide it.
This piece of information to the presidency, InsideBsinessNG was told, earned Shonubi, his new position as the Acting-Governor.
It would be recalled that the DSS had commenced an investigation of the banking industry including the CBN last December. During the investigation, several documents to ascertain the financial health of the apex bank and the operators were requested. These include details of the forex allocation to banks between 2017 and the present date. Others are the summary of the top 50 customers who received the most forex allocation in order of magnitude in the schedule of the I &E window allocated to individual banks from 2017 to date and under the Q allocation; the amount allocated to each bank; the name of the individual customer and/or beneficiary/beneficiaries; the basis/criteria for the allocation, and the name of the person that authorised and carried out the allocation (whether it is the CBN or the DMB or both).
It would be recalled that the DSS encountered a series of challenges including the suit by the Incorporated Trustees of Forum Accountability and Good Leadership and the 18th January injunction by Justice S.B Belgore of High Court 10 of the Federal Capital Territory in the Abuja Judicial division that temporarily stopped the investigation.
The injunction was vacated some days after but the revelations from the probe were embarrassing to the presidency and some of its officials who are neck deep in the rots in the CBN and the banking industry in general.
Although the preliminary report of the probe was submitted to former President Muhammadu Buhari on 19th January, the DSS was stopped from inviting the current CBN board members and some past members who featured in Emefiele’s tenure.
Sources in the Aso Villa said the presidency would have been further embarrassed if the meeting was allowed as some board members are ready to open up on the alleged mess in the CBN.
With the suspension and arrest of Emefiele, and also the request for the financial statements of the CBN from 2019 to 2022, both KPMG and EY, the two auditors are likely, again, to be under searchlight following the disclosure by their engagement partners on CBN that the audited accounts were fraudulently prepared.
Findings at the DSS show that both Ayo Othinwa of KPMG and Jamiu Olakisan of EY are still on bail having signed the bail bond with a written pledge to cooperate with the secret police on the investigation of the apex bank.
Also, the management of the Financial Reporting Council (FRC), the financial statement regulator, which is also the supreme regulator in the country will also return to the DSS for their involvement in the audited accounts of the apex bank.