3 months ago
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Stakeholders have frowned at the appetite of the federal government to always look for ‘free money’ to take over, not considering the implications.
Initially, FG was considering using part of the pension assets to meet its fiscal needs.
Recently too, there is a recent argument that the Federal Minister of Finance wants to tax foreign exchange gain by 50 per cent.
However, over the weekend, reactions have continued to trail the reviewed guideline on Management of Dormant Accounts, Unclaimed Balances and Other Financial Assets in Banks and Other Financial Institutions in Nigeria which directs the banks to send the funds in dormant accounts to the Central Bank of Nigeria (CBN).
The apex bank had at the weekend, released the guideline account balances in bank accounts that have been dormant for a period of 10 years will be transferred into the Unclaimed Balances Trust Fund (UBTF) Pool Account domiciled with it.
Whilst the move was seen by some as a global standard, many have said, it is another revenue generating ploy by the government.
On his part, group executive chairman of Lancelot Group, Adebayo Adeleke noted that this suggests the government or CBN wants to take over the dormant account.
“Government is always looking for money, especially people’s money. This is what SEC did with unclaimed dividends, also AMCON is doing the same. Government is always looking for free money that they can corner.”
He lamented that “what is the business of CBN with dormant accounts, the contract is between the customers and the banks and not between the customer and CBN. And I am not aware of any law that empowers a third party to come into an agreement between two parties and begin to enforce certain directives.
“I am not aware of CBN having such a provision and if there is, let them also publish it so that we know that there is a legal backing for what they are doing. I am not aware, I am not saying it does not exist but if there is such a provision that empowers them to suddenly come in between a client and the bank, then they should let us know.”
He further explained that, “when you say an account is dormant there is always a provision for re-activation so if the customer comes tomorrow he will come to the bank that he has a contract with and reactivate the account not with CBN.”
He emphasised that “all over the world governments are always looking for ways they can take people’s money, from tax, unclaimed dividend and so on.”
He urged people to also defend their investments, saying, in this case, the government or CBN has no rights over the dormant account as the contract here is very simple: it is between the client and the bank.
Also commenting, the managing director/CEO of APT Securities And Funds, Garba Kurfi recalled that “recently.
There is a recent argument that the Federal Minister of Finance wants to tax foreign exchange gain by 50 per cent and the question is that this is the policy that comes this year and the capital gain was for last year. So how can you set a law and backdate it?”
He said, “now it is the issue with the dormant account. The fact that the account is dormant does not mean it is dead. Because a dormant account can wake up. And even if the owner is dead, the beneficiaries have the right to claim their assets.”
He asked “if CBN takes it over, what are the possibilities that when the owner now wakes up and says they want their money, how will they get it back?”
Kurfi added that , this remains an issue until the guideline is clear and the procedure is clear, saying, “we do not know the extent of the amount that are in the dormant account, then we will be able to come in to say that, with this quantum, this can drain the bank.”
He added that, “the CBN needs to come out on how the owners either by asset or by whatever means they want their money back, how will it be retrieved back?”
He stated that, “we want to see the policy and the full guideline before we can make a full comment. But there really is going to be a big issue for the banks, especially the old generation banks like First Bank, United Bank for Africa, Wema Bank and others.
Professor of Finance and Capital Market at the Nasarawa State University, Keffi, and former commissioner of finance in Imo, Professor Uche Uwaleke whilst noting that the move is not unique to Nigeria said, many countries have a gestation period of between 20 and 25 years.
He however noted that the 10 years period stipulated by the CBN is the same as the requirement for Canada and higher than some countries with a gestation period of five years.
A civil servant, Matthew Adelaja, advised that individuals should consider taking the necessary steps to reactivate their accounts, because the government is looking for money by all means.
“There are numerous accounts that remain inactive due to various reasons, one of which could be the unfortunate passing of the account holder, leaving their assets unclaimed and untouched. Furthermore, individuals who have purchased shares but have not yet claimed them must take action promptly.”
At Aboru, Iyana-Ipaja area of Lagos Moshood Fatai, said: “I be omo igboro, they cannot claim my account because my account no fit dey dormant. You know we get money pass each other. But for person wey dey Street like me, i dey hustle every time, my account no fit dormant.”
English (US) ·