THE Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, said that forensic verification of $7 billion foreign exchange (FX) backlogs which revealed corrupt practices is nearing completion and is in the final settlement process.

Cardoso disclosed this at the Nigeria Foreign Exchange (FX) Code launch in Abuja on Tuesday, January 28.

He said the process is to help restore transparency and trust in the market and uncover unethical and illegal practices in FX transactions.

“We must not forget where we are coming from. The era of multiple exchange rates, which created privileges for a select few at the expense of most Nigerians, severely undermined market integrity.

“As an example, the $7 billion of FX backlogs that have taken over 12 months to verify has led to the discovery of multiple unethical and even illegal practices that we should not be proud of as a nation. The forensic verification process is now near complete, and final settlements will be processed accordingly,” Cardoso said.

He stressed that the practice had negative impacts on inflation, currency depreciation, and the erosion of public confidence in the system.

Cardoso assured that such distortions would no longer be tolerated under the FX Code, which mandates strict adherence to ethical principles.

The apex bank boss noted that CBN had embarked on reforms including the unification of exchange rate windows and recalibration of monetary policy tools, aimed at addressing structural issues.

He reiterated that the CBN is now on the part of preventing a recurrence of market distortions.

The ICIR can report that the FX backlogs stem from legacy issues during the period of multiple exchange rates and systemic abuses that eroded public confidence.

In February 2024, the CBN revealed that about $2.4 billion foreign exchange backlog was not valid for settlement.

At the time Cardoso asserted that of the initially reported $7 billion FX liabilities on the Federal Government, about $2.4 billion were identified as invalid following a forensic audit by Deloitte Management Consultant.

The audit’s findings showed various infractions, including non-existent entities and unauthorised FX allocations, making these liabilities invalid.

Cardoso had committed to clearing the FX backlog for the aviation sector when international airlines threatened to halt their operations in Nigeria, The ICIR reported.