Fake Naira: Counterfeits In Circulation Less Than 1% – CBN Refutes Mailafia’s Claim

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The Central Bank of Nigeria (CBN) has reacted to a statement credited to an ex-deputy governor of the bank, Obadiah Mailafia, who claimed that the percentage of fake naira notes in circulation is at an alarming high – 20%.

Mailafia had while delivering a public hearing on 2017 Budget Appropriation Process in the National Assembly on Monday said that the government is not aware of massive fake currency in circulation, claiming that about 20% of the naira notes currently in circulation around the country are fake.

Also See: Beware! 20% Of Naira Notes In Circulation Are Fake – ExCBN Deputy Gov. Warns

In a statement issued yesterday by the CBN spokesman, Isaac Okoroafor, the apex bank described the claim as “spurious and uninformed”, saying fake naira notes in circulation are less than one percent.

The CBN said it has always endeavored to use strong security features to make it difficult for dishonest persons to counterfeit the naira and therefore finds it curious that a former high-ranking official of the bank would make such bogus and unauthentic claims apparently calculated to destroy confidence in the national currency and sabotage the collaborative efforts of the CBN and the federal government at ensuring enduring stability of the financial system.

“The attention of the Central Bank of Nigeria (CBN) has been drawn to certain spurious and grossly uninformed claims suggesting that about 20 percent of the naira currency notes in circulation are counterfeited,” it said.

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“While we acknowledge that no currency in the world is immune from counterfeiting, we make bold to state that the rate of counterfeiting in Nigeria has been very minimal due to appropriate policies put in place by the bank. Indeed, our records at the bank clearly indicate that the prevalence of counterfeit notes in Nigeria from January to December 2016 was less than one percent (0.0014%) or 14 counterfeit pieces out of one million bank notes.

“The unfortunate implication of the fabricated claim of the said former official of the bank is that it gives the false impression that two bills out of every ten naira pieces held by an individual are ‘fake’.

“For the avoidance of doubt, the CBN frowns strongly at attempts to counterfeit the naira. We remain committed to safeguarding the value of the naira by ensuring that our naira banknotes are not susceptible to counterfeiting. We also work constantly with relevant security agencies to monitor and check the activities of counterfeiters,” the bank said.

Mailafia also alleged that investors’ knowledge of huge economic potentials injected in the country accounted for the recent over-subscription of $1 billion Eurobond initiated by the Federal Government.

He added that it would be detrimental to the growth of the economy, stating that original currency remains scarce with such magnitude of fake naira notes.

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The Federal Government seems not to agree with Mailafia on that as it states that the massive demand for its $1 billion Eurobond, which was oversubscribed by 780 percent, was a demonstration of the strong market appetite for Nigeria and indicative of the confidence by the international investment community in Nigeria’s economic reform agenda.