SBM Intelligence, an Africa-focused market/security Intel gathering and strategic consulting firm, has expressed concern that Binance bribery claim could deter foreign investments in Nigeria.
In its analysis of the Binance saga and its impact on the Nigerian economy, the firm noted that the circumstances that led to the detention of Binance executives could undermine Nigeria’s attractiveness to foreign investments.
The consulting firm further urges the government to thoroughly investigate the matter and punish anyone found guilty.
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SBM Intelligence said,
“Accusations of bribery involving high-profile government officials like those in the Tinubu Administration can further damage the country’s reputation and that of the administration itself. Such allegations can undermine investors’ trust in the government’s integrity and ability to conduct fair and transparent business dealings.
“When government officials are perceived as corrupt or willing to engage in unethical behavior, it can deter foreign investment, undermine the rule of law, and hinder efforts to combat poverty and inequality. No matter the allegations against Binance, it is essential to remember that the story of one foreign business will serve as a cautionary tale to others. If Nigeria is tagged as a country where company officials can be solicited for bribes and then detained indefinitely, convincing investors to invest will become exceedingly challenging”.
The consulting firm further urged the Nigerian government to resolve its issue with Binance as quickly, fairly, and diplomatically, adding that it would be in their best interest.
Backstory
Recall that in February this year, the Central Bank of Nigeria (CBN) governor Yemi Cardoso alleged that over $26 billion in illicit flows passed through Binance last year.
This led the Nigerian government to block Binance operations in the country, as well as other crypto firms to avert what it considers continuous manipulation of the forex market and illicit movement of funds.
In line with this, the Government detained at least two senior executives of Binance, Najeem Anjarwalla and Tigran Gambaryan, both of whom were charged with fraud and not adhering to regulations, among others.
In a recent disclosure, Binance accused some top government officials of demanding $150m in crypto to settle the criminal charge levied against them. Binance Chief Executive Officer, Richard Teng, made the bribery allegation in a blog post published by the New York Times.
However, Nigerian lawmakers knocked Binance over bribery allegations. The Minister of Information and National Orientation, Mohammed Idris, in a statement, dismissed the claims as baseless, stating that it is an attempt by Binance to evade accountability for alleged criminal activities.
The minister said,
“This claim by Binance CEO lacks an iota of substance. It is nothing but a diversionary tactic and an attempted act of blackmail by a company desperate to obfuscate the grievous criminal charges it is facing in Nigeria. We would like to remind Binance that it will not clear its name in Nigeria by resorting to fictional claims and mudslinging media campaigns. The only way to resolve its issues will be by submitting itself to unobstructed investigation and judicial due process.”
The government, therefore, pledged to address the legal issues surrounding Binance operations in the country.
The International Monetary Fund (IMF) has urged Nigeria to establish a robust regulatory framework for cryptocurrency trading platforms, emphasizing the need for anti-money laundering controls and platform supervision. This call comes amid allegations by Binance’s new CEO that Nigerian government officials took bribes, which Binance has refuted, stating inaccuracies in the report. The situation has raised concerns about the impact on Nigeria’s investment climate and the future of cryptocurrency regulation in the country.