Central Bank of Nigeria CBN

Court faults CBN on discriminatory bank charges

A federal high court sitting in Awka, Anambra state has faulted the Central Bank of Nigeria (CBN) for imposing discriminatory bank charges on some categories of cash depositors from N500,000.00 and above in selected six states and the FCT.

The CBN had through two Circulars tagged BPS/DIR/GEN/CIR/04/004 and PSM/DIR/CON/CWO/02/014, published on April 20, 2017 and September 17, 2019 respectively, imposed the charges.

The court’s position followed a Suit marked FHC/AWK/CS/91/2020 filed by a lawyer, Chijioke Ifediora challenging the said CBN action in which he stated that the charge was ultra vires, illegal and unconstitutional.

The Plaintiff had urged the Court presided by Justice Nnamdi Dimgba to, considering the provisions of Sections 1 (3 ), 2 ( 1) and Section 42 of the Constitution of Nigeria, 1999 ( as amended), determine whether the said two CBN Circulars are not discriminatory, ultra vires, unconstitutional and illegal.

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The plaintiff in his averment said he took the decision to sue the CBN when on January 7, 2020, he went to the Bank at Amawbia Awka, to make cash lodgment of N600,000 into his account, and was told that he would not be allowed to effect the deposit without paying the charge in accordance with the CBN Circular PSM/DIR/CON/CWO/02/014.

Ifediora consequently urged the court to grant three reliefs that the said two CBN Circulars are ultra vires, unconstitutional and illegal. That they are in conflict with Section 1(3), Section 2(1) and Section 42 of the 1999 Constitution of Nigeria and that the charges emanating from the implementation of the two CBN Circulars are illegal and unlawful.

The five Declaratory Orders the Plaintiff sought were for the CBN “to refund all citizens and corporate bodies operating in Anambra illegally or unlawfully charges by the implementation of the said Circulars,

“To refund of all citizens and corporate bodies operating in Anambra, Abia, Lagos, Ogun, Kano, Rivers and FCT who were also allegedly illegally or unlawfully charged by the implementation of the Circulars.

“To order a perpetual injunction restraining the Defendant/ CBN from publishing or issuing Circulars or implementing similar policies that are discriminatory or in conflict with Section 42 of the Constitution,

“To restrain all Financial Institutions and Deposit Money Banks from implementing similar discriminatory policies,

“And to direct the CBN to make a reversal publication of the implementation of the said Circulars in five ( 5) national newspapers indicating compliance with the decision of Court and refund of the unlawful charges”.

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Counsel for the CBN, Chief Musa M.Tolani, an Aba based legal practitioner,
in his submission, argued that the Plaintiff lacked the locus standi to institute the Suit.

He described the plaintiff as a meddlesome interlopper, since he did not have the authority of all the citizens and corporate institutions residing in the states affected by the CBN circular, and failed to show how the policy affected him injuriously more than the rest of the residents of the states being sought to be protected.

The defence counsel added that the policy was introduced to facilitate the implementation of the CBN well intentioned and worthy cashless policy for the overall well-being of the Federation economy.

In his judgement, Justice Dimgba agreed with the Plaintiff that the policy was discriminatory before its general application across the Federation, hence the Suit is one challenging the lawfulness of the action of the CBN, which is a Federal Government agency.

He stressed that Section 252(1)(p) of the Constitution has vested the court with the jurisdiction to the exclusion of any other court to dispose of matters like that.

While he agreed with the Plaintiff that the CBN policy was discriminatory and offended section 42 of the 1999 constitution (as amended) in the first three reliefs sought by the Plaintiff, but refused to grant his five (5 ) consequential Orders sought from the Court.

Justice Dimgba explained that his refusal to grant the five consequential Orders was because it was admitted during oral hearings that the policy is now of nationwide application.

He made no Order as to costs against the Defendant.

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