In what looks like another Cleaner Lagos Initiative, ‘Mallams’ (another name for men of Hausa ethnic stock) in Lagos, are helping to mop up dirty and torn Naira notes.
So, If you have a dirty, mutilated Naira note, not dollar this time, which no one accepts, look for a currency dealer from the North, at a time when the nation’s currencies, especially the N100 notes, in circulation can be said to be wearing their worst looks.
What has become more shocking and far more embarrassing now is not that many Nigerians no longer accept them as means of payment. But the fact is that some have discovered the wisdom in quickly turning the very dirty and torn notes into scraps like irons which they could buy at give-away prices and make huge money for themselves.
Without doubt, Nigerians know about scrap business – buying some metal scraps at very ridiculous prices. They even go to the extent of visiting dust-bins and dump sites to search and pick such items which have become source of wealth for them. This is the same fate now being suffered by N100 notes.
In fact, in some worship centres in Lagos, members are usually warned against dumping dirty and mutilated Naira notes into the offering boxes while the mallams now scavenge for such notes.
That battered N100 note has been turned to scrap of sort came to Saturday Tribune like a bad dream. A few days ago, a correspondent boarded a Berger-bound bus in the Ojodu area of the city and one of the passengers, a woman, insisted on not taking the N100 note that the conductor offered her as change because of its terrible look. The conductor pleaded that he had no other note to give but the woman refused to budge. This face-off forced the woman to disembark from the bus, as suggested by the conductor, so that another passenger could take her place.
As the woman disembarked in anger to jump on one of the waiting motor cyclists plying the same route, some passengers in the bus chorused in unison that there was nothing wrong with the Naira note the woman was complaining about. It was as if they were waiting for the woman to disembark. About three of the passengers – a man and two women – went on to share their experiences.
Sellers’ experiences
According to the woman who first spoke, there was nothing anybody could do about the poor Naira notes in circulation now, especially the N100 denomination. She said further that, “It is only in this part of the country that we still reject money because of its poor look.”
She disclosed to the surprise of passengers that a few days back, one mallam accosted her on the street to ask her if she had some poor Naira notes to sell. “I had thought he was one of those buying scraps because of his appearance. They are even buying half a note, assuming you don’t have the other half, maybe the other half is lost,” she added.
The male passenger sitting beside her corroborated the story. He was also accosted by people in such a business, asking if he had mutilated Naira notes to sell. He said he had sighted them in two locations in Oregun paying just N50 for every mutilated N100 denomination, meaning that every dirty and torn Naira note is worth half the price.
The other woman, who lamented having to be given four pieces of defaced N100 denomination as change at a shop, recalled that she was once approached by one of such buyers.
“And the question I asked was: what do you need them for and where would you take them to? His reply is that I should sell them to him and he would buy and take them to Arewa (the North),” the woman said.
“This is slightly different from the business of exchanging newly-minted notes, especially, during ceremonies, the Christmas and New Year celebrations which has been on over the years. People usually show off with such ‘untouched’ notes by spraying the celebrants at ceremonies. In the past, commercial banks used to supply such new notes to their customers during this time of the year but somehow, they have disappeared from the banks. Rather, the ‘direct-from-mint’, which could not be found in the banks, became readily available at markets in major cities across the country. The business became so lucrative that some traders left their former businesses to go into the sale of new Naira notes,” the passenger said.
We are legit –Buyers
Abdullai, a Lagos-based Sokoto State indigene, confirmed to Saturday Tribune that some of the people from the northern part of the country do buy old and rejected Naira notes from the southern part and take them to the North. He said “those people who buy scraps are the ones doing it.”
He said further that “not all the dirty and torn notes are being spent in the North. There are other things that our people use such money for. It depends on the person who is taking the money to the North. What I can confirm is that our people buy rejected money (notes) here and take them to the North.
“They usually buy them in large quantity. Some of these scavengers sell those notes to our people who return to the North to spend them. You know that our people don’t reject money, unlike what happens in this part of the country. Not all of them spend the money in the North. Some of them exchange such rejected money for their needs like food, provision and others. I also heard that banks in the North often collect such money as deposit unlike banks in this part of the country. I don’ know the roles of the banks in all this but our people do take such money home.
“What they usually do is that they exchange N5,000 rejected notes for a spendable and neat N1,000. Some of them would fix some of the rejected naira notes. Those which require adhesive tape will be fixed and spent even in this part of the country, while those which cannot be amended will be taken to the North.”
A bureau de change operator, Rasak, also confirmed the buying of rejected naira notes to Saturday Tribune but pointed out that bureau de change operators do not engage in such an act. He added that only scavengers and those who buy second-hand household items indulge in the practice.
“No, we don’t buy rejected Naira notes. We only exchange Naira notes with foreign currency and we buy jewellery. The people who buy rejected Naira notes are those who buy scraps and those who buy second-hand goods. They take these rejected Naira notes to the North and spend over there. Our people rarely reject money like your people do here.
Asked if the people who buy rejected Naira notes might pose a threat to the bureau de change operators, Rasak said: “No, they cannot affect our business. We deal mainly in foreign currency and our operations are guided by the Central Bank of Nigeria. Now that you people know that some people are buying and selling Naira notes, it is left for the central bank to make a statement on that. Let me confess to you now that it never occurred to me that what those people were doing was wrong. The police never harassed or arrested any of them.”
Dirty acts, dirty notes
The illegal hawking of new notes expectedly limited the wide circulation of same since they are not being paid for instead of having them as a replacement for the old and disused Naira notes. Findings by Saturday Tribune showed that N10 is charged for every N100, making it N100 extra on a new N1,000 note. Because such new notes are seen as status symbol, they are the preferred at social gatherings, while holding them anywhere is seen as conferring some “honour and attention on you and people tend to see you as someone different and influential because a few people can now lay their hands on such scarce notes,” a socialite disclosed.
Residents of the state have gradually woken up to the reality of the “disappearance” of serviceable and “useful” N100 notes. A resident around Ikeja asked if Saturday Tribune had not observed that N100 notes were no longer in existence. Olajuwon may not be completely correct but the notes are no longer easy to come by these days, regardless of whether it is a high-class or low-class transaction. New ones are like the proverbial masquerade excreta, which is rare to find. But as now common with other denominations, what is not in circulation is always in large quantity with hawkers at social gatherings and it doesn’t appear that those who buy them are ready to just let them go easily into circulation.
The available N100 notes are as dirty, mutilated and sickening as they come. When the noise over who should pack the disease-prone notes out of circulation became a national issue, instead of taking responsibility, both the Central Bank of Nigeria (CBN) and the Deposit Money Banks (DMBs) got into a war of passing bucks over who should pay to mop the shame-of-a-nation notes with federal lawmakers joining the fray.
No one could say precisely how it started but the sale of newly-minted Naira notes is now a national trade and, maybe, national shame, despite the law criminalizing it. On major roads where high net-worth motorists ply, at event centres, especially at weekends when social functions are usually celebrated and even unbelievably around worship centres, hawkers of the commodity have become an everyday sight, with law enforcement agencies watching helplessly as both the law and the currency, which is supposedly, the nation’s pride, are being abused.
One major factor said to be responsible for the inability to get them off the road and the illegal business is the belief that the hawkers on the street are mere errand boys for some powerful and well-connected Nigerians who are seen as untouchable by the law.
Banks have also been variously indicted in this abuse, because the new notes reportedly go through them to illegal hands and without doubt, it is only the big bankers that could get such done, especially those in charge of managing liquidity in the system.
Just like the new notes abuse, hawking of dollars as means of foreign exchange and providing opportunities for those who will not be able to access same through banks is another national shame afflicting Lagos State. Though not in the magnitude of new notes, efforts at sanitising the forex mess through the Bureau De Change operators haven’t achieved much.
Ikeja hotel dollar fraud
Every hour of the day, young men are seen in front of the Lagos Airport Hotel, Ikeja, touting for customers, despite the BDC corner inside the hotel, close to its main entrance. Their offers, whether you are buying or selling dollars, always come as mouth-watering as they get, but nearly everyone who had done business with them has one unpleasant story or the other to tell.
One major feature of their notoriety, as discovered by Saturday Tribune, is the Naira value of the dollars, always coming short of the original amount by the time the customer leaves their domain, though they will count the money in one’s presence and everything would appear to be in order.
A resident who wanted anonymity and claimed to have gone through the hotel touting tutorial unfolded the trick usually deployed to Saturday Tribune. According to her, “It is not juju (charm). Many people think it is juju they use to count your money complete in your presence only for you to get home to discover that the money is actually not complete. What they do is that when they are paying you in Naira for the dollars they are buying from you, they fold some notes in the bundle twice, using rubber-band and will count a note as two while counting using one edge of the arranged notes. If you want to finish (catch them at their game) them, tell them you want to count one by one, separating the notes and dropping one full one after the other. They will simply tell you, they are not buying dollars again.”
CBN fumes
Reacting to the development in a chat with Saturday Tribune, acting Director, Corporate Communications, Central Bank of Nigeria (CBN), Mr Isaac Okoroafor, said any form of trading in Naira as a commodity is against the law and attracts punishment.
“Hawking the Naira, whether clean or dirty, is a breach of the CBN Act. Those hawking supposedly dirty Naira notes are as guilty as those hawking the new ones. The police will surely arrest them and they will be jailed,” Okoroafor said.
Who pays the bill?
The House of Representatives had earlier this year directed the CBN to stop imposing charges on commercial banks before receiving mutilated and dirty notes from them. The lawmakers said the surcharge was one of the major reasons why the banks were reluctant to withdraw such notes from circulation or accept them from customers.
Following the intervention, the apex bank a few weeks back reduced the cost of sorting mutilated notes from N12,000 to N1,000 per box.
CBN said with effect from January 2, 2018, the amount of money it charges banks for sorting mutilated Naira notes from clean ones had been reduced by N10,000 to N1,000 per box, from N12,000 to N2,000 after March 28.
As a follow-up, the CBN recently called on bank customers to always insist that banks give them new Naira notes because they are now receiving sufficient new notes from the regulator.
“So, customers should insist on new notes from them. We believe that with a combination of these, customer’s insistence and the large waiver we have given, customers should get new Naira notes. I don’t see why people should not be getting those new notes,” Okoroafor said.
He added that the reduction was done to encourage banks to bring the mutilated notes to the CBN in exchange for new ones.
Investigations revealed that the banking public in Lagos and its environs had been blaming commercial banks for flooding markets with dirty, mutilated Naira notes and called on the CBN to control the situation.
They said this had been causing a lot of argument, embarrassment and loss of sales for commercial transport drivers, petty traders and their customers.
Okoroafor, however, explained that the banks were supposed to employ people to do the sorting, the same way CBN has employed people to do it. Instead, he claimed they expected the CBN to do the sorting for free and re-circle the notes because they are avoiding cost.
What obtained in the past was that instead of sending dirty and defaced Naira notes to CBN sorted, the banks sent them unsorted. Then the apex banking regulator started charging them N12,000 per box such that a box of N1,000 notes contains N10 million in value, while a box of N500 notes is N5 million in that order.
The latest reduction, according to CBN, was, however, limited to lower denomination Naira notes or polymer notes, namely, N50, N20 and N10 notes. Also, the reduction to N1, 000 per box, which took effect from January 2, lasted for three months till March 28.
Further checks revealed that a box of Naira notes contain 10,000 notes, hence with the reduction, banks will now pay N1,000 as currency sorting fee for a box of N50 which contains N500,000; N1,000 for a box of N20 notes which contains N200,000; N1,000 for a box of N10 which contain N100,000; and also N1,000 for a box of N5 that contains N50,000.
Meanwhile, the latest reprieve from the regulator has been welcomed by stakeholders as a way of listening to public outcry by the apex bank.
According to Okoroafor, “on January 2, we wrote a circular to banks, telling them that the cost of currency processing, which stands at N12,000 per box, will be reduced from N12,000 to N1,000 between January 2 and March 28.
“That is, there is window of three months. And that any bank that brings a box of lower denomination currency notes which include: N50, N20, N10, N5, we would process it for them at N1,000 per box instead of N12,000, because those were the ones that are more critical.
“And that after March 28, the cost of sorting is still low but it will go to N2,000, instead of the original N12,000, and this is for the polymer notes. The other ones are not as critical.”
He said this was done to encourage banks to return these bad notes so that we can issue new ones. “We have enough new ones to issue to them. Our problem is that banks have not been returning these notes because of the fear of sorting fee that we would charge them,” he emphasised.
Looming danger
A bank customer and lawyer who preferred anonymity expressed worry that the alarming quantity of dirty/mutilated currency notes in circulation had become a national embarrassment. He said banks were issuing torn, mutilated and unhygienic currency notes through Automated Teller Machines (ATM) and across the counter.
“I observe that in spite of the arrest and subsequent prosecution of the culprits, there is still a cartel in CBN and commercial banks which makes brisk business recycling old Naira notes meant for destruction,” he said.
They enrich their bank accounts, according to him, acquiring properties through these illegal proceeds by converting the equivalent of the mutilated notes into their accounts and selling printed mint meant for customers to touts and hawkers.
“Section 21(4) of the CBN Act of 2007 makes it a punishable offence for any person to hawk, sell or trade in Naira notes, coins or any other issued by the apex bank,” he said.
The legal practitioner stressed that most of the mutilated currency notes in circulation harboured pathogenic microorganisms hazardous to human health.
A pathogen refers to a bacterium, virus, or other organisms that cause disease. In biology, a pathogen or a germ in the oldest and broadest sense is anything that can produce disease.
He said that the mutilated notes also harbour infectious diseases such as diarrhoea, food poisoning and respiratory problems.
It is illegal –Police
The image maker in charge of the state police command, Chike Oti, described the practice as “illegal,”, although he claimed not to be aware of such a practice.
Oti, while speaking with Saturday Tribune, said, “They can be arrested for that. We will arrest them if we find out that they are buying and selling currency. It is illegal to sell the Nigerian currency.”
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