In modern times, it is no news that for a government to operate successfully without tyranny, there must be non-fusion of governmental powers in one body of persons; that is, the functions of the arms of government has to be separately carried out by each arm without interference by the other arms of government.

The legislature, whose primary function is lawmaking, should not be allowed to perform the function of the executive, which is implementation, or the judiciary, whose role is interpretation and adjudication, respectively.

However, in modern times, we are faced with problems that cannot be solved only by the traditional means of lawmaking by the legislative arm of government.

This complexity has led to the creation of various government agencies and bodies saddled with the responsibility of law enforcement and policy developments.

These organs are created under an enabling law of the state or national assembly. It is noteworthy, however, that when these organs contravene or act outside their enabling statute, their actions will be declared null, void and of no effect.

These functionaries of governments are mostly a creation of an Act of Parliament, and this Act specifies their functions, the scope of their powers, limitation of their powers and the penalties for breach of their codes of conduct.

It is worthy of note that one of the many sanctions adopted by some of these functionaries (EFCC, ICPC, CBN), especially where the breach warranting the sanction involves money, is the issuance of an order to the bankers to freeze such accounts and enforce a post-no-debit alert on the account holding the funds.

A post-no-debit order is that which seeks to restrict all debit transactions, including those involving the use of Automated Teller Machines (ATM), Cheques, tokens and all forms of debits. Such that accounts could be credited, however, by whichever means but will be unable to post a debit transaction.

The Central Bank of Nigeria, (hereinafter referred to as the CBN) was created by Section 1(1) of the CBN Act, 2007. The act creates an office of the governor in Section 6(2)(a) of the CBN Act, 2007. The bank could be said to be a primary regulatory organ overseeing the financial sector of the Nigerian economy.

By virtue of Section 97 of the Bank and other financial institution Act, 2020 (BOFIA), the CBN Governor is empowered to freeze the accounts of companies and individuals suspected to be fraudulent or an infraction under the law.

However, can CBN and your local bank unilaterally place a permanent PND on a customer's bank account?

Don't that think it will amount to a breach of the customer's fundamental human right o own movable and immovable properties in any part of the country?

Brb.

cc: perryy

There are limitations to the rights listed by the condition. Even right to life can be taken in case of riot/inssurection against the state. Likewise, were fraud or terrorism financing is suspected, your right to free ownership and movement of property can be limited by PND.

The Central Bank of Nigeria, (hereinafter referred to as the CBN) was created by Section 1(1) of the CBN Act, 2007. The act creates an office of the governor in Section 6(2)(a) of the CBN Act, 2007. The bank could be said to be a primary regulatory organ overseeing the financial sector of the Nigerian economy.

By virtue of Section 97 of the Bank and other financial institution Act, 2020 (BOFIA), the CBN Governor is empowered to freeze the accounts of companies and individuals suspected to be fraudulent or an infraction under the law.

However, CBN does not have the power to unilaterally freeze a bank account.

The law expressly provides that CBN shall upon reasonable suspicion apply by a motion ex-parte to a Judge of the Federal High Court, deposing on oath the basis for such suspicion.

We much also state that by the provision of Section 97(3) of BOFIA, the Governor is also empowered to refer the matter to the anti-graft agencies, such as EFC, ICPC, NIA, DSS, etc. These bodies are by law empowered to investigate acts of criminalities and prosecute erring account holders as enunciated in our criminal laws books.

Is Dealing/Trading in Cryptocurrencies a Criminal Offence and Does CBN Have the Powers to Make Criminal Laws?


In a recently decided matter, CBN v. Rise Vest Technologies Ltd, the court held that CBN does not have powers to make criminal laws unilaterally without recourse to our law books.

The CBN had unilaterally placed a post no debit (PND) restriction on the Plaintiff's bank account for dealing in cryptocurrencies.

CBN in defending its actions argued that dealing or trading in cryptocurrencies resulted in the weakness of the naira against the dollar. The apex bank also posited that its actions were justified and the PND was placed pursuant to its regulatory circular outlawing dealing or trading in the digital currency.

The court further held that CBN failed to show any law prohibiting trading or dealing in cryptocurrencies. The court in her inherent wisdom postulated that a regulatory circular is not a law and cannot, therefore, create an offence because it was not shown to have been issued under an Act, Order of Court, Law or Statute.

The learned federal judge in his judgment, discharged the PND placed the Plaintiff's bank account for being null, void, and of no effect.

However, it must be noted that while the CBN may have placed the PND based on an alleged breach of its circular, the court held that the CBN cannot rely on a mere circular to unilaterally place a post no debit order on the account of a company without an order of a competent court.

Furthermore, It is pertinent to note that by virtue of Section 36(12) of the constitution of the Federal Republic of Nigeria (as amended), an Act will not constitute a crime unless it is clearly defined and the punishment for the criminal act is clearly prescribed by a written law.

The court, in the much-celebrated case of Aoko v. Fagbemi, the court held that an act will not constitute a crime unless it is clearly defined as such by a written law.

Section 1(3) of the Consitution clearly provides that any law, act or actions of any arm of Government that is inconsistent with the provision of the Constitution shall be declared null and void to the extent of its inconsistency.

It, therefore, presupposes that CBN does not even have the powers to ban cryptocurrencies in Nigeria, much more placing PND an account of bank customers for allegedly dealing or trading in the digital currency.

It is also safe to conclude that from the above provisions of the constitution and verbose case law, a person cannot be punished for an offence that was not; as at when it was committed, contained in any written criminal law book.

Do you, therefore, think the CBN can break a law to enforce an unknown law such as the prohibition of cryptocurrency within the Nigeria space?

excellence44:
There are limitations to the rights listed by the condition. Even right to life can be taken in case of riot/inssurection against the state. Likewise, were fraud or terrorism financing is suspected, your right to free ownership and movement of property can be limited by PND.

Do you still maintain your position that CBN can break a law to enforce a non-criminal law as though it was a criminal law? Has CBN complied with the condition precedent thereto, when it reasonably suspects fraud or acts of criminality?

I await your response.

The courts in the celebrated case of Okafor v. Lagos State Government defined written law to be an Act of the National assembly or the Law of a state.

The courts appear to have risen like the phoenix from the ashes, as recent trend appears to be in favour of bank customers whose accounts have been unlawfully frozen without the due process of law.

Hence, in the case of Blaid Construction Nig Ltd & Anor. v. Federal Republic of Nigeria, Hon Justice Binta Nyako of the Federal High Court reversed the directive of ICPC, which froze and placed a PND on the accounts of the Plaintiff in that suit without due process of law.

Conclusively, it is worthy of note that the primary bank is duty-bound to ensure that it does not breach the fiduciary duties, more particularly the quinesecare duty it owes its numerous customers.

Sequel to the recent decisions of the courts, financial institutions are, therefore, advised to always ensure any regulatory agency directing it to place a PND on any customer’s account, present an order from a court of competent jurisdiction before it complies with such directive. Ignorance is not an excuse as the law will not exculpate a bank for breaching the fiduciary duty it owes its customers.

Thus, it is safe to save to conclude that the CBN cannot unilaterally place a PND order on any bank account without an order from any court of competent jurisdiction.

Credit: Lexorian C.A.Ozowara

litigator:



Do you still maintain your position that CBN can break a law to enforce a non-criminal law as though it was a criminal law? Has CBN complied with the condition precedent thereto, when it reasonably suspects fraud or acts of criminality?

I await your response.

Waiting for response from who? Odiegwu! That paid empty head has no reasonable response to give.

Kudos for your efforts in educating Nigerians, and saving them from these evil men in charge of the affairs of the country.

litigator:
In modern times, it is no news that for a government to operate successfully without tyranny, there must be non-fusion of governmental powers in one body of persons; that is, the functions of the arms of government has to be separately carried out by each arm without interference by the other arms of government.

The legislature, whose primary function is lawmaking, should not be allowed to perform the function of the executive, which is implementation, or the judiciary, whose role is interpretation and adjudication, respectively.

However, in modern times, we are faced with problems that cannot be solved only by the traditional means of lawmaking by the legislative arm of government.

This complexity has led to the creation of various government agencies and bodies saddled with the responsibility of law enforcement and policy developments.

These organs are created under an enabling law of the state or national assembly. It is noteworthy, however, that when these organs contravene or act outside their enabling statute, their actions will be declared null, void and of no effect.

These functionaries of governments are mostly a creation of an Act of Parliament, and this Act specifies their functions, the scope of their powers, limitation of their powers and the penalties for breach of their codes of conduct.

It is worthy of note that one of the many sanctions adopted by some of these functionaries (EFCC, ICPC, CBN), especially where the breach warranting the sanction involves money, is the issuance of an order to the bankers to freeze such accounts and enforce a post-no-debit alert on the account holding the funds.

A post-no-debit order is that which seeks to restrict all debit transactions, including those involving the use of Automated Teller Machines (ATM), Cheques, tokens and all forms of debits. Such that accounts could be credited, however, by whichever means but will be unable to post a debit transaction.

Please what is the process of putting a PND or freeze on the bank account of someone who has scammed you?

TellMeTheTruth:


Please what is the process of putting a PND or freeze on the bank account of someone who has scammed you?

Approach the nearest police station and speak to a police officer or talk to your lawyer. They know exactly what to do. The faster the better