CBN to fine banks N400 for every mutilated N100 note included in deposits

The Central Bank of Nigeria (CBN) has directed Deposit Money Banks (DMB) to stop including mutilated notes as part of their deposits with the apex bank.

Ripples Nigeria had earlier reported how the CBN spent N3.88 billion to destroy over N4.13 trillion worth of dirty currencies deposited by commercial banks in the last six years.

To stop the trend, the CBN in a circular signed by its Director of Currency Operations, Ahmed Umar, warned banks would now pay a fine of N400 for every N100 mutilated dirty notes effective from April 1.

Umar said that the existence of such banknotes in the economy falsified the true value of the currency in circulation.

He added that the development could also be a channel for fraudulent activities in the banking sector.

The director stressed that mutilated banknotes discovered in the banks’ deposits with the apex bank would attract a penalty of 400 percent of the value.

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The circular read: “The management of the CBN observed with concern the increasing number of composed banknotes deposited by DMBs and the request for replacement of such banknotes by members of the public.

“The existence of composed banknotes in the economy falsifies the true value of the currency in circulation, and can also be an avenue for fraudulent activities.

“Consequently, any composed banknote discovered in the deposit of DMBs shall attract a penalty of 400 percent of the value.”

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