Falana sues CBN, says floating of naira ‘illegal’

The Central Bank of Nigeria’s flotation of the naira has drawn criticism from human rights attorney Femi Falana, SAN.

Falana also revealed that he is suing to stop the naira from floating, calling the move “illegal.”

The CBN allegedly gave deposit money banks the order to let the naira float freely against foreign currencies on June 14, when it was trading in the Investors and Exporters window at a range of 730 to 755 against the dollar. The exchange rate is now shown as being N744 to N746 on the CBN website.

Falana asserted, however, that the CBN Act mandates that the central bank establish the currency rate in a Friday appearance on Channels Television’s Sunrise Daily.

“Floating the naira is not permitted. It’s prohibited. You claim that market forces will determine how much the naira is worth. The law does not mention that.

“I had to sue the Central Bank of Nigeria at the Federal High Court because Section 16 of the Central Bank Act had mandated that the Central Bank fix and determine the rate of the naira vis-à-vis other currencies,” he stated.

Falana cites Section 20(1) of the CBN Act, which specifies that only the currency notes issued by the Central Bank, specifically the naira, are recognised as official legal tender in Nigeria. The use of any other currency in Nigeria without the central bank’s permission is prohibited by Section 20(5) of the Act, which carries a six-month prison sentence.

We won’t make any progress, according to Falana, until government representatives take action to fortify the naira and make it the only accepted form of payment in Nigeria.

Additionally, he pointed out that the Federal Government’s approval of N5 billion for each state and the FCT as palliatives is only a short-term solution meant to deflect attention.

They are only short-term solutions. Some of them are very pointless, and government officials have not addressed the dollarization of the economy, which is what caused the issue in the first place.

The dollarization of the economy, he said, would consume any palliatives that were announced.