FG Accuses CBN Of Misusing ₦2.73 Trillion Interest Funds

The Federal Government has accused the Central Bank of Nigeria (CBN) of misusing ₦2.73 trillion in interest payments from Ways and Means advances.

This claim is based on the Federal Government’s consolidated financial statement for the year ending December 31, 2021, as presented by the Auditor-General, Shaakaar Chira.

According to the report, the CBN allegedly kept the funds for its own benefit instead of transferring them to the Consolidated Revenue Fund (CRF), which is required by law. The document, with reference AuGF/AR.2021/01, was dated July 31, 2024.

What Are Ways and Means Advances?
Ways and Means advances are short-term loans provided by the CBN to help the Federal Government manage budget deficits. However, the process has been criticized for non-compliance with financial rules.

The report states that interest charges amounting to ₦2.73 trillion were retained by the CBN in violation of the law. It cites Section 80(2) of the 1999 Constitution, which forbids any withdrawal from the CRF without prior approval through an appropriation or supplementary act. Additionally, paragraph 710 of the 2009 Financial Regulations prohibits overdrafts and requires that any interest on such overdrafts must be returned to the CRF.

Allegations Against the CBN
The Auditor-General’s findings revealed that ₦17.1 trillion in overdrawn accounts, involving the CRF and other government bodies, lacked proper approvals or documentation. Specifically, the CBN is accused of withholding ₦2.73 trillion in interest payments for its own use.

The report states:
“The interest charged on Ways and Means by CBN was misappropriated by CBN for its sole use, whereas the actual Ways and Means was not a facility from its funds or balance sheet, nor was it a syndicated facility from a group of local and foreign lenders. CBN must therefore refund to the Federal Government of Nigeria the interest of ₦2.73 trillion it cornered for its sole use as of 31st December 2021.”

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