The Central Bank of Nigeria (CBN) has secured an Abuja federal high court ruling to freeze the accounts of six fintech companies for 180 days.
The court granted the request of the apex bank to freeze accounts of Rise Vest Technologies Limited, Bamboo Systems Technology Limited, Bamboo Systems Technology Limited OPNS, Chaka Technologies Limited, CTL/Business Expenses, and Trove Technologies Limited.
In court papers, the regulator stated that it is investigating illegal foreign exchange transactions by the fintech companies.
In the motion ex parte marked FCH/ABJ/CS/822/2021 and filed on August 4, the CBN said “it is evident that Rise Vest Technologies Limited, Bamboo Systems Technology Limited, Chaka Technologies Limited and Trove Technologies Limited are complicit in operating without license as asset management companies and utilising FX sourced from the Nigerian FX market for purchasing foreign bonds/shares in contravention of CBN’s directive.”
The CBN through its counsel Michael Kaase Aondoakaa, submitted that “the investigation being carried out concerns what has been discovered to be serious infractions by the defendants/respondents in connection with some foreign exchange transactions, and non-documentation by the defendants/respondents in violation of the extant laws and regulations, particularly the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act and the Central Bank of Nigeria foreign exchange manual.
“That more specifically, there is a grave allegation that the defendants/respondents are engaged in illegal foreign exchange transactions, accessing/procuring of foreign exchange via their banks from the Nigerian foreign exchange market via several bureaux de change, international money transfer operators and have transferred cash deposit of more than S10,000.00 (Ten thousand dollars) to various accounts overseas contrary to provisions of extant laws and regulations and also traded in foreign securities and cryptocurrencies in contravention to CBN Circular referenced TED/FEM/FPC/GEN/01/012 and BSD/DIR/PUB/LAB/014/001 dated February 5, 2021, and July 01, 2015.
“It is evident that Rise Vest Technologies Limited, Bamboo Systems Technology Limited, Chaka Technologies Limited and Trove Technologies Limited are complicit in operating without license as asset management companies and utilising FX sourced from the Nigerian FX market for purchasing foreign bonds/shares in contravention of CBN’s directive.”
The judge Ahmed Mohammed ruled: “having listened to senior counsel to the applicant, on the motion ex parte filed in August, it is granted as prayed.”
According to him, any person who feels aggrieved about the freezing order is entitled to approach the court within the period to seek redress.The case was adjourned to February 20, 2022, for hearing.
However, the affected fintech are assuring investors of the security and safety of their funds.
Said Bamboo, “We are aware of the recent reports about us. Our legal and government relations teams are looking into it but we thought it was important to let you know that your money remains safe and will always be accessible,” Bamboo said.
According to Risevest, “With regard to the latest news about us and our FX dealings, you can be sure that your investments and funds are safely managed, that funding and withdrawals will continue to be processed as normal, and that all our US operations remain intact,” Risevest wrote in a mail to investors
“We will work with regulators, as we always have to ensure that all issues raised are properly addressed. However, this does not affect our users or their investments, which are managed by regulated third parties in all jurisdictions in which we operate.”