Using forex for local transactions in Nigeria can now get you arrested

13th April 2015 Conducting local business in Nigeria and insisting on using dollars and other foreign exchange currencies could now get you on the wrong side of the law, according to The Central Bank of Nigeria. The institution recently raised concerns over the increasing use of foreign currencies as a means of exchange in Nigeria and have put out a warning to the effect that those who are found going against the directive now risk a six-month jail term if found guilty.

The central bank said in a statement that some people and corporate bodies had been using foreign currencies, especially dollars, to price some of their products and services, as well as using it as a medium of exchange, thus going against the provisions of the CBN Act, 2007.

Members of the public have now been advised to report anyone caught transacting business in the country in foreign currencies to the central bank or the Economic and Financial Crimes Commission.

According to Mr. Ibrahim Muazu, the Director of Corporate Communications at the Central Bank of Nigeria, “The attention of the bank has been drawn to the increasing use of foreign currencies in the domestic economy as a medium of payment for goods and services by individuals and corporates. It has also been observed that some institutions price their goods and services in foreign currencies and demand payment in foreign currencies rather than the domestic currency (the naira), which is the legal tender in Nigeria.

“For the avoidance of doubt, the attention of the general public is hereby drawn to the provision of the CBN Act of 2007, which states inter-alia that ‘the currency notes issued by the bank shall be legal tender in Nigeria…for the payment of any amount.

Furthermore, the Act stipulates that any person(s) who contravenes this provision is guilty of an offence and shall be liable on conviction to a prescribed fine or six months imprisonment. This prohibition, however, is without prejudice to foreigners, visitors and tourists who are encouraged to continue to use their cards for payments or exchange their foreign currencies for the local currency at any of the authorized dealers’ outposts”