After a successful meeting at the National Assembly this morning between @officialGredo and Barrister Somtochukwu Okeke, with an Honorable member of the committee on Central Bank of Nigeria at the House of Representatives … wherein we tabled our concern as to the alleged ban on cryptocurrency by the CBN via a circular, and the constant harassment and infringement on crypto traders usage of their bank accounts for transactions been perpetrated by the CBN in conjunction with the banks… we all agreed that;
1. It is illegal for the CBN to issue a circular banning cryptocurrency as cryptocurrency is not captured within the BOFIA act… CBN only has powers to regulate matters captured within BOFIA act.
2. The CBN cannot place a ban on cryptocurrency, as it is an emerging modern trend and market… the CBN can only request the National Assembly to adopt a regulation to regulate the market, and not ban the market entirely.
3. The CBN cannot envelop all traders as sponsors of fraud, money laundering or terrorism… every sector has those who abuse it… the CBN can only work with relevant security agencies so as to control such negatives..
It was now resolved that:
1. The lawyer put up a petition detailing all the harassment and intimidation by the CBN, Banks and EFCC against crypto traders, within this week, addressed to the National Assembly, signed by relevant crypto traders… Barrister Okeke will personally handover the petition to the speaker of the house of reps… the petition will be read and debated on the house floor… after which CBN will be addressed to refrain from such infringements and come up with better ways to regulate the trend…
2. Those already affected by the circular should approach the Federal High Court to unfreeze their accounts
Nigerian Court Unfreezes Accounts Blocked For Cryptocurrency Trading In Big Win For Traders
The law is trite that any conduct that must be sanctioned must be expressly stated in a written law.
A Federal High Court sitting in Abuja on Monday vacated an interim order which directed the Central Bank of Nigeria (CBN) to freeze accounts of two firms in two banks that were linked to cryptocurrency trading.
The firm, Rise Vest Technologies Ltd, is one of the firms offering brokerage services for Nigerians to invest in foreign stocks.
CBN claimed, among others, that some of such deals contravened its directive and were part of what was making the naira weaker against the US dollar.
Justice Taiwo O. Taiwo in his judgement held that the CBN could not rely on a mere circular to freeze the bank accounts of a company using its accounts to trade in cryptocurrency.
According to the Judge, the CBN failed to provide any law showing that it is illegal to deal in cryptocurrency in Nigeria, adding that the CBN circular, referenced as BSD/DIR/PUB/LAB/014/001 of February 5, 2021, is not a law.
He, however, ordered the banks – Zenith Bank Plc and Guaranty Trust Bank – to immediately grant the firm unfettered access to the accounts.
The order was made by the court while ruling on a Motion on Notice brought by Rise Vest Technologies, praying the court to discharge an interim freezing order granted by the court on August 17, 2021, in Suit No: FHC/ABJ/CS/822/2021
CBN Governor (Plaintiff/Respondent) V Rise West Technologies Ltd (1st Defendant/Applicant) & five Others, are the parties to the suit.
Submission had earlier been made by Rest Vest Technologies’ counsel, Mr Seni Adio (SAN), that CBN did not present any evidence that the defendant engaged in any unlawful conduct, adding that the CBN did not meet its burden of proof in support of its allegations.
But CBN’s counsel, Mr Mathew Onoja argued that the ex parte orders the court sought to be set aside were proper, lawful and valid.
He contented that the orders of August 17, 2021 in the suit were in accordance with the provisions of Section 97 (1) of the Banks and Other Financial Institutions Act (BOFIA) 2021, which empowered the Plaintiff/Respondent to invoke the jurisdiction of the Court via an ex parte application.
Justice Taiwo, in his ruling, upheld Adio’s argument, while he observed, among others, that although the CBN had power to investigate any infraction, the infraction must relate to BOFIA or any other enactment administered by the regulator.
“I have perused the counter affidavit of the Respondent and I see that the reason for freezing the account of the applicant is based on the alleged infraction of the circular of the CBN.
“The law is trite that any conduct that must be sanctioned must be expressly stated in a written law.
“Being unknown to law, circulars cannot create an offence because it was not shown to have been issued under an order, Act, Law or Statute.
“The learned counsel for the respondent has also raised the issue of public policy in his submissions against the application.
“Can this court decide this application based on public policy as being urged on it by the learned counsel for the respondent? I think not.
“I hereby discharge the interim freezing order of this court made on August 17, 2021, made against the defendant/ applicant,” Justice Taiwo held.
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