The Minister of Finance, Mrs. Kemi Adeosun has urged the Central Bank of Nigeria (CBN) to expedite action in the planned extension of the requirement for Bank Verification Number (BVN) to account holders in Microfinance Banks (MFBs), to help facilitate the detection of bank accounts operated by fraudulent syndicates for ghost workers in the banks.
The Minister also sought cooperation of the CBN in a correspondence to the CBN Governor, Godwin Emefiele, noting that the introduction of BVN in the main stream Deposit Money Banks has contributed immensely in improving the integrity of the Federal Government payroll on which more than 50, 000 ghost workers were detected and removed.
Adeosun said the operation of bank accounts in MFBs without requirement for BVN has left a huge loophole which individuals intent on financial crimes could use to hide and launder proceeds of crime and successfully escape detection by law enforcement agencies.
“Our ongoing efforts to verify the integrity of Federal Government personnel costs and purge the system of fraud and error has made extensive use of the Bank Verification Number as a means of identifying recipients of multiple salaries, and salaries paid into accounts with names that differ to those held on our payroll records. The success of this effort has to date yielded the removal of over 50,000 payroll entries,” the Minister said according to a statement that was signed by director of information in the ministry of finance, Salisu Na’inna Dambatta.
Mrs. Adeosun disclosed that prior to the deadline for obtaining the BVN, the movement of a large number of salary accounts of Federal employees from commercial banks to Microfinance Banks, was observed. “This is a suspicious activity and we have already commenced a review of such cases to identify and investigate any cases of fraud,” the Minister explained.
The CBN had in September in 2016 announced its intention to extend the requirement for the extension of the BVN to MFBs in the country, but yet to implement it.
Noting that extending the requirement for BVN to the banks may put a huge financial strain on the smaller MFBs, She pointed out that some MFBs, such as National Police Force Microfinance have over 27,000 salary accounts. “Our inability to perform checks on such a large number of salary earners is a key risk,” she said.
“I am therefore seeking your co-operation to enforce compliance with BVN on any MFB with over 200 active salary accounts or those above a certain size. This will support the Federal Government’s efforts at reducing leakages to create headroom for the capital projects that will support the growth of the economy,” the Minister said in the correspondence.