Nigeria freezes bank accounts for forex platforms, traps millions of dollars

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Forex trading platforms in Nigeria are decrying recent actions by the country’s central bank that has seen them lose access to millions of dollars in their bank accounts. The Central Bank of Nigeria went to court to freeze their accounts, claiming they were engaged in illegal foreign exchange and that they were offering some services they weren’t authorized to.

The Federal High Court in Abuja froze the bank accounts of a number of leading investment and forex trading platforms that have become increasingly popular in recent years. According to local reports, Justice Ahmed Mohammed gave the order to freeze the bank accounts, stating that those who are aggrieved by the order can “approach the court for redress.”

The Punch, a Nigerian newspaper, reports that the motion to freeze the accounts was filed by Chief Michael Kaase Aondoakaa on behalf of the CBN with the intention of allowing the bank to probe the defendants’ financial activities in Nigeria.

CBN claims that the order is because the defendants were operating without obtaining a license as an asset management company and “utilizing FX sourced from the Nigerian FX market for purchasing foreign bonds/shares in contravention of the CBN circular referenced TED/FEM/FPC/GEN/01/012, dated July 01, 2015.”

The affected companies are Rise Vest Technologies, Chaka Technologies, Bamboo Systems Technology, CTL Business Expenses and Trove Technologies Limited.

CBN’s filing will see the court freeze the companies’ accounts for a period of 180 days pending the outcome of the investigation into the companies.

Christiana Gyang, a senior supervisor at the central bank told local media that the bank had been reviewing the forex firms and had determined they have been engaged in illegal foreign exchange.

The affected companies have responded, assuring their users that their funds are safe, with some even giving the users an alternative on how to access their funds.

Rise Vest sent an email to its users, in part stating, “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 U.S. operations remain intact. We will work with regulators, as we always have to ensure that all issues raised are properly addressed.”

It added, “However, this does not affect our users or their investments, which are managed by regulated third parties in all jurisdictions in which we operate.”

Bamboo also assured its users that their funds were safe on Twitter.

Hi everyone, we’re 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 with Bamboo and will always be readily accessible.

— Bamboo (@investbamboo) August 17, 2021

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