MTN Reacts To CBN Sanction, Insists Paid Dividends Were Approved

Telecommunication giant, MTN Nigeria has reacted to the sanction imposed on it by the Central Bank of Nigeria (CBN).

In a statement on Thursday, it denied the allegations of illegal funds repatriation levelled against it by the apex bank.

Contrary to the claims, MTN stated that all dividends paid to shareholders were approved by the nation’s financial regulator in accordance with the law.

The company, however, said it would meet with relevant government agencies to defend its position on the matter.

The CBN had ordered the telecoms firm and four commercial banks to return $8.1 billion to the country.

The apex bank stressed that the sanction was necessary following a breach of the nation’s forex regulation by the parties involved.

In 2015, the Nigerian Telecommunication Commission MTN Nigeria slammed a fine of about N1.04 trillion, which was later reduced to N330 billion, on MTN Nigeria for failing to disconnect 5.2 million unregistered sim cards.

Read the full statement by MTN Nigeria below;

MTN Nigeria Communications Limited received a letter on August 29, 2018, from CBN alleging that Certificates of Capital Importation (CCIs) issued in respect of the conversion of shareholders loans in MTN Nigeria to preference shares in 2007 had been improperly issued.

As a consequence, they claim that historic dividends repatriated by MTN Nigeria between 2007 and 2015 amounting to $8,1 billion need to be refunded to the CBN.

MTN Nigeria strongly refutes these allegations and claims. No dividends have been declared or paid by MTN Nigeria other than pursuant to CCIs issued by our bankers and with the approval of the CBN as required by law.

The issues surrounding the CCIs have already been the subject of a thorough enquiry by the Senate of Nigeria. In September 2016 the Senate mandated the Committee on Banking, Insurance and other Financial Institutions to carry out a holistic investigation on compliance with the Foreign exchange (monitoring and miscellaneous) Act by MTN Nigeria & Others. In its report issued in November 2017, the findings evidenced that MTN Nigeria did not collude to contravene the foreign exchange laws and there were no negative recommendations made against MTN Nigeria.

MTN Nigeria, as a law-abiding citizen of Nigeria, is committed to good governance and to abiding by the extant laws of the Federal Republic of Nigeria. The re-emergence of these issues is regrettable as it damages investor confidence and, by extension, inhibits the growth and development of the Nigerian economy.

We will engage with the relevant authorities and vigorously defend our position on this matter and provide further information when available.