NDIC probes 183 microfinance banks’ directors

The Nigeria Deposit Insurance Corporation (NDIC) says it will begin the investigation of the directors and officers of the 183 microfinance banks whose licences were revoked earlier this year.

The Managing Director of the NDIC, Mr. Bello Hassan, said this at a one-day capacity building workshop for law enforcement agencies on Thursday in Lagos.

He said law enforcement agencies, including the Economic and Financial Crimes Commission (EFCC) and the Nigerian police, among others, would soon be called to investigate sharp practices by the directors of these defunct banks.

“As you are all aware, the Central Bank of Nigeria recently revoked the banking licenses of 183 MicroFinance Banks (MFBs) and Primary Mortgage Banks (PMBs) which may require you to be called upon to investigate some of the directors and officers of these institutions with a view to bring to book those found culpable in the collapse of these institutions,” he said.

Hassan, represented by Mr. Henry Fomah, Head of Legal Department of NDIC, noted that through the collaborative efforts of agencies, 12 prosecution cases are currently ongoing at various courts.

“There are 25 ongoing investigations at the Nigeria Financial Intelligence Unit (NFIU), 11 with the EFCC, and five concluded investigations with the Federal Ministry of Justice for advice and prosecution,” he said.

According to him, this indicates that the corporation as well as other government agencies are on the right course through collaboration.

This, he said, would bring to book the errant directors, officers, and managers of these banks that led to their collapse, adding that a stable financial system could not be guaranteed if the banking industry was not well sanitised.

“The corporation, whilst bearing in mind the positive impact of such collaboration, will continue to strive to enhance the synergy between all of us in the areas of law enforcement relating to the investigation and prosecution of financial malpractices.

“I want to use this forum to appeal to the members of the task force not to relent on your oars but to execute the given mandate diligently, thereby achieving the objectives of establishing the task force,’’ he said.

He added that the corporation was not unaware of the challenges of investigating and prosecuting financial malpractices and bank fraud cases, urging officers not to relent in their efforts.

The NDIC boss noted that the advancements in information technology and new possibilities in banking operations had equally exposed the banking subsector to emerging threats.

He said the situation had increased the burden on the regulators and supervisors to enhance their operational capacities, as well as heightened the need for more collaboration between agencies involved in the fight against banking malpractices.

Mr. Kofo Salam-Alada, the Head of Legal Services at CBN, said it was essential for agencies that would collaborate with regulators to have deep insight into how regulators operate.

“A lot of gaps have been seen, which is why we must commend the Nigerian Deposit Insurance Corporation for having been the vanguard of sponsoring capacity-building exercises for the past 12 years,” Salam-Alada said.

According to the News Agency of Nigeria (NAN), the aim of the workshop is to equip officers involved in the investigation and suspicion of financial malpractices in the banking system with the necessary skills required to carry out their duties diligently, with particular focus on failed banks.

Techrectory with agency report

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