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Thursday, November 21, 2024

CBN Fines Mayfresh Mortgage Bank N5M for falsification

The Central Bank of Nigeria (CBN) has fined Mayfresh Mortgage Bank Limited N5 million for falsifying all the minutes books and Board approvals presented to Examiners during the previous examinations and providing misleading information to the CBN contrary to Section 7.3 Item 8 of the Revised Guidelines for Primary Mortgage Banks in Nigeria.

CBN gave the penalty in a report titled: “Investigation into the petitions written against Mayfresh Mortgage Bank Limited by two shareholders and a former director,” signed by MD. Dalvop for Director, Other Financial Institutions Supervision Department.

In the document, dated October 23, with Ref: OFI/SG1A/CON/PMB/016/359, and addressed to the Acting Managing Director, Mayfresh Mortgage Bank Limited, the apex Bank directed Mayfresh shareholders to immediately dissolve the current board and institute a new Board and its Committees to provide necessary oversight on the bank’s affairs.

It also directed that the list of the new board members and other required documents should be forwarded to the CBN for approval without delay.

CBN further gave the bank 14 days within receipt of the report to respond to it’s query on the reported fraud cases of N30 million and N23.854 million involving some management.

The report reads: “We received petitions from two shareholders and a former Managing Director of the bank claiming several cases of fraudulent interference by some board members and senior management. The petitions also made serious accusations against the bank’s current management.

“In line with the above, a team of two Examiners visited your bank for an on-the-spot assessment and verification of these claims from the petitioners. Considering the current situation of the bank and discoveries made by the Examiners, you are required to implement the following with immediate effect:

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“The bank’s shareholders should immediately dissolve the current board and institute a new Board and its Committees to provide necessary oversight on the bank’s affairs. The list of the new board members and other required documents should be forwarded to the CBN for approval.

“All shareholders of the bank, particularly Rev. Fr. Edeh and Maria Omego, must cease interfering in the day-to-day running of the bank immediately. Whatever concerns they bear should be addressed only at the Annual General Meetings or Extraordinary General Meetings.

“The bank should immediately disengage Maria Omego from being the Chief Cost Controller, as the position was not in the approved oraganogram of the bank.

“The Head of Treasury, Pamela Awa, and the Elele (CPM) Branch Manager, Ijeoma Nwankwo, and its officers should be redeployed and investigated immediately for breaches and subversion of the bank’s policies.

“As a matter of urgency, the bank should constitute a team to reconcile all its unposted transactions in branches and establish the true credit position of the bank to all its related parties, such as Caritas University, J.C.T Properties, and Madonna University, which had negatively impacted on its financial position. This exercise should be completed, and the report submitted to the CBN within thirty (30) days of receipt of this letter.”

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It added, “The bank should stop further loan/overdraft disbursement to all its related parties (sister companies/institutions) and embark on full recovery of all outstanding loans/advances to these parties.

“The bank is required to respond to the CBN’s query on the reported fraud cases of N30 million and N23.854 million within fourteen (14) days of receipt of this letter.

“In line with Section 50 of BOFIA 2020, the PMB is required to issue a cheque/draft 2 million in favour of the Central Bank of Nigeria for payment of interim dividends to shareholders on yet-to-be-approved Audited Accounts for 2021, 2022, and 2023 financial years.

“For falsifying all the minutes books and Board approvals presented to Examiners during the previous examinations and providing misleading information to the CBN contrary to Section 7.3 Item 8 of the Revised Guidelines for Primary Mortgage Banks in Nigeria, the bank is required to issue a cheque/draft of 5 million in favour of the Central Bank of Nigeria as a penalty for this contravention.

“Finally, the bank is required to implement all the recommendations stated above immediately and issue two separate cheques/drafts (2 million and N5 million) in favour of the Central Bank of Nigeria, as indicated above.”

Ede Nwa Ede
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