Naira Crashes Further Against Dollar At Parallel Market

Despite the Central Bank of Nigeria (CBN) warning that forex speculators and hoarders will be punished, speculators have continued to stash dollars as naira continues on a free fall.

Checks at the parallel market on Tuesday showed that the naira exchanged at N485/$1.

The naira also traded N410/ $1 at the I&E Forex window.

The President, Association of Bureaux De Change Operators of Nigeria (ABCON), Aminu Gwadabe, who spoke on the development, blamed the naira woes on forex speculators and black market forex dealers.

He said henceforth; the licensed BDCs will be actively involved in dealing with speculators.

"The Central Bank of Nigeria (CBN)-licenced Bureaux De Change (BDC) operators will not standby and watch the currency business derailed by currency speculators and black market dealers who are not answerable to any authority," he told DailyTrust.

Market dealers also attributed the naira depreciation at the parallel market to speculators causing artificial scarcity of the dollar within the market.

Other market dealers also attributed the naira's continued decline to a heightened forex supply shortage, demand pressure and rationing.

Gwadabe said BDCs would continue to support the CBN to defend the naira through compliance with the Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) and supporting CBN's exchange rate stability policies.

He said every BDC operator needed full knowledge and understanding of how to raise and submit both the Suspicious Transaction Reports (STRs) and Currency Transaction Reports (CTRs) to regulators, understand the obligation of registering and filing reports on the NFIU goAML -Anti-Money Laundering portal and proper documentation of all forex sales.

He said all BDCs should file their reports as and when due weekly to the Nigerian Financial Intelligence Unit, CBN, the Economic and Financial Crimes Commission, and Know Your Customer (KYC).

"Be vigilant in your operations because you can be spot-checked by the CBN examiners at any time.

"All BDCs should appoint Compliance Officers and Data Protection Officers as directed by the CBN, which is also in-line with the global best practices.

"Also, avoid sending your returns late, selling dollars above CBN approved rate," he advised.

Gwadabe said that by following set rules, the operators would set a good example in their operational modalities and make forex buyers lose confidence in black market dealers.

The CBN Governor, Godwin Emefiele, recently said that the 'Naira 4 Dollar' policy was meant to increase remittance inflows' transparency and reduce rent-seeking activities.

He expressed optimism that the new policy measure would encourage banks and financial institutions to develop products and investment vehicles geared towards attracting Nigerians' investments in the diaspora.