By Joanne Oji
The tenure of the governor of the Central Bank of Nigeria Sanusi Lamido Sanusi, who only this morning was placed on suspension was one characterized by a lot of controversy. Sanusi was appointed CBN governor in June 2009, by the late President Umaru Musa Yar’adua in the middle of a global financial crisis and immediately swung into action.
At the time, many saw him as a hero, what with the removal of so many bank chiefs and subsequent prosecution. He was hailed the saviour of the CBN and if I remember correctly, there were discussions at the time about how more competent he was compared to Chukwuma Soludo who he replaced.
Fast forward a few years later, what went wrong?
In August 2009, Sanusi led the Central Bank of Nigeria to “rescue” Afribank, Intercontinental Bank, Union Bank, Oceanic Bank and FinBank by bailing them with 400 billion naira of public money, and dismissed their chief executives. Some people had pointed to other factors including religious, ethnic and existing bank records and plans to say he in fact had a hidden agenda. In his words, “We had to move in to send a strong signal that such recklessness on the part of the bank executives will no longer be tolerated.”
Aside his strict economic policies that many did not find palatable, there was the issue of the N5,000 note that generated so much public outcry and got subsequently abandoned. The huge and unprecedented donation of N100m to Kano state in the wake of a bomb blast by the dreaded Islamic sect, Boko Haram did not go down well with many, as they sought to know where the money was coming from and why such donations had not been made to other affected States at the time.
This prompted the Primate of the Church of Nigeria (Anglican Communion) Most Rev. Nicholas Okoh to ask “is he giving the N100m on behalf of the President? Is he giving his personal money? There are so many questions that are not clear. Is the CBN governor qualified to make the donation on behalf of the country? What is he donating it for and to whom? Is that not partisanship? Is it because he is from Kano state that he decided to give a whole N100m to them? Why didn’t he donate to other people?”
There were also controversies over issues relating to Islamic banking, the sex scandal at some point involving a staff on secondment to the CBN, his turbaning ceremony and heading to work in full Islamic regalia amongst others.
Erstwhile unheard of things were happening in the CBN and it seemed Sanusi was ruling his “kingdom” with an iron first as his policies seemed incontrovertible and unchallengeable, but it was only a matter of time before the chicken came home to roost.
Sanusi’s case may be described in the words of Achebe as the “little bird Nza who so far forgot himself after a heavy meal that he challenged his Chi.”
A lot of issues have been raised about the legality or otherwise of his suspension. It’s amusing that most people think the CBN governor is untouchable even by the C-in-C and have gone ahead to proffer reasons why they think the suspension is improper. The proper word to use here may be to say it is as “aberration” and not to totally condemn the suspension itself. An aberration is “a departure from what is normal, usual, or expected, typically an unwelcome one” as can be seen in the instant case.
A look at the CBN Act 2007 sheds more light on this issue. It should however be pointed out that this analysis is that of the writer, as the Law has severally been described as an “Ass” and the better argument usually carries the day in court.
Section 6 of the Central Bank of Nigeria Act 2007 establishes the Board of the CBN and is quoted as follows;
6. (1) There shall be for the Bank a Board of Directors (in this Act referred to as “the Board”) which shall be responsible for the policy and general administration of the affairs and business of the Bank.
(2) The Board shall consist of –
(a) a Governor who shall be the Chairman;
(b) four Deputy Governors;
(c) the Permanent Secretary, Federal Ministry of Finance;
(d) five Directors; and
(e) Accountant-General of the Federation.
(3) The Board shall be responsible for –
(a) the consideration and approval of the annual budget of the Bank;
(b) the approval of the audited and management accounts and the consideration of the management letter from the external auditors.
(c) the formulation and implementation of exchange rate policy;
(d) making recommendation to the President for the appointment of auditors in accordance with section 49 of this Act, the provision of the necessary facilities and the rates of remuneration;
(e) the establishment and closing of branches and currency centres; and
(f) carrying out of such other activities as are necessary and expedient for the purposes of achieving the objectives of the Bank.
(4) The Board shall approve the detailed responsibilities of each of the Deputy Governors on the recommendation of the Governor.
(5) Without prejudice to Sub-section (4) of this section, the Board may, on the recommendation of the Governor, assign or re-assign the Deputy Governors, from time to time, as may be expedient for the performance of the Bank’s functions under or pursuant to this Act.
Having gone through that section, the duties of the Board does not include the removal or suspension of the Governor as the case may be. I have quoted that section because it is leading to my main point about the authority vested with the removal of the CBN Governor. Some erroneously believe and have suggested that the Board is empowered to remove the Governor while the President is only empowered under the paragraph that specifically mentions him.
Further, going down other provisions of the same Act, Section 8 provides for the authority vested with the power to appoint the Governor and the Deputy Governors and it would not be necessary to reproduce same here.
The main section of note here is Section 11 of the Act that provides for “Disqualification and Cessation of Appointment” of the Governor. Having been part of legal drafting and review of laws slated to be amended, a few times, I would point out that there’s no complete statute. The law can never in any circumstance cover every aspect, it is then left for the court to decipher the “intendment of the draftsman” using the various rules of interpretation available to it in any given case.
Said Section 11 is quoted below;
11. – (1) A person shall not remain a Governor, Deputy Governor or Director of the Bank if he is –
(a) a member of any Federal or State legislative house; or
(b) a Director, officer or employee of any bank licensed under the Banks and Other Financial Institutions Act.
(2) The Governor, Deputy Governor or Director shall cease to hold office in the Bank if he –
(a) becomes of unsound mind or, owing to ill health, is incapable of
carrying out his duties;
(b) is convicted of any criminal offence by a court of competent
jurisdiction except for traffic offences or contempt proceedings arising in
connection with the execution or intended execution of any power or duty
conferred under this Act or the Banks and Other Financial Institutions Act;
(c) is guilty of a serious misconduct in relation to his duties under
(d) is disqualified or suspended from practicing his profession in Nigeria by order of a competent authority made in respect of him personally;
(e) becomes bankrupt;
(f) is removed by the President:
Provided that the removal of the Governor shall be supported by two-thirds majority of the Senate praying that he be so removed.
Many have hinged their argument on Subsection 2 paragraph f, that specifically names the removal by the President supported by two-thirds majority of the Senate praying that he be so removed, and have gone ahead to exclude his powers under the preceding paragraphs. So then I ask, if the Board is not given the power of removal/disqualification, who has the power to remove the CBN governor under Paragraphs A-E? Your guess is as good as mine.
The question is, what was the intention of the lawmakers when they specifically provided for the appointment of the Governor and Deputy Governors and Directors by the President and the silence as to how said removal would happen. I beg to say that the President is also vested with same powers.
“The Governor, Deputy Governor or Director shall CEASE to hold Office in the Bank if he…”
This particular section of the law uses the word CEASE which word can adequately cover situations like the instant suspension. Merriam-Webster dictionary defines “Cease” as “to come to an end especially gradually: no longer continue”
Whether the CBN governor has been suspended or has ceased to hold office is a matter of nomenclature and it should be pointed out that a suspension doesn’t necessarily mean an outright removal, as was seen in the case of the DG of the Securities and Exchange Commission Arunma Oteh. The conspiracy theories should abate for the time being.
Subsection 2 paragraph C provides that “(c) is guilty of a serious misconduct in relation to his duties under this Act;” and I think this paragraph serves as an omnibus provision because it does not define “serious misconduct” thus, making unsubstantiated claims about missing billions and subsequently having to retract same statement, financial recklessness etc. just might fall under such misconduct.
Sanusi has been fond of such sensationalism in the past, making many query his motive and particularly his political leaning.
The reason given for the suspension by the Presidential spokesperson Mr. Reuben Abati are “the reports of the Financial Reporting Council of Nigeria and other investigating bodies, which indicate clearly that Mallam Sanusi Lamido Sanusi’s tenure has been characterized by various acts of financial recklessness and misconduct which are inconsistent with the administration’s vision of a Central Bank propelled by the core values of focused economic management, prudence, transparency and financial discipline…”
In conclusion, it remains to be seen the dimension this recent suspension will take but one thing is certain, those who have called the President “weak” and “clueless” just might have another thing coming.