Nigerian court unfreezes N89 million in bank accounts previously indicted for illegal crypto dealings

On Monday, Justice Emeka Nwite lifted the preservatory order on the following accounts: Awe Microfinance Bank (N2,367,624.45), Olalekan Sibiku Adesugba (N3,375,435.41), Ad Ishola Farms (N10,104,482.91), H. Ishola Multibiz Int’l (N16,505,822.74), Microtech Investment Services (N3,545,660.73), and HML Business Ventures (N53,585,649.77). 

This decision came after the EFCC filed an affidavit on November 25, 2024, stating that its investigation revealed the funds in these accounts, totaling N89,484,694.01, were not linked to any unlawful activities. 

Naijaonpoint had previously reported that the EFCC, on September 4, 2024, secured an order freezing N548.6 million in bank accounts belonging to suspected crypto users on platforms such as ByBit, KuCoin, and others, based on their alleged role in fluctuations of the naira. 

The motion, dated September 3, 2024, which the court relied on to freeze the funds, focused legal attention on major foreign crypto platforms ByBit and KuCoin, accusing them of contributing to the devaluation of the Nigerian currency. 

“The investigation activities include analyzing financial records of transactions carried out by the operators of the bank accounts to determine the sources and destinations of the funds; inviting and interviewing the operators of the accounts and some individuals who could shed light on the suspicious transactions,” he stated. 

“The Applicant (EFCC) has concluded its investigation about the accounts listed at Nos. 5, 8, 10, 11, 19, and 22 in the motion, and the funds in these accounts have not been linked to unlawful activities. 

“Given the outcome of the investigation so far, it is appropriate to discharge the preservatory order on the accounts listed at Nos. 5, 8, 10, 11, 19, 21, and 22.” 

He further stated that investigations into the remaining accounts had not been concluded, as some individuals had yet to honor their invitations, and more documents were being analyzed. 

“Application granted,” Justice Nwite responded, thereby unfreezing the six bank accounts. 

The judge also directed that the respective banks be notified in writing of the discharge order for other indicted accounts, whose freezing period had expired due to the effluxion of time. 

This development follows a previous court order freezing 1,146 accounts for 90 days (from April 25, 2024, to July 23, 2024) due to illegal financial transactions. 

An affected party later applied to have several of the freezing orders lifted, and the court granted the request. 

However, the EFCC filed a new motion to continue its investigation, having pressed criminal charges against some of the account operators. 

Naijaonpoint reports that the EFCC and Federal Inland Revenue Service (FIRS) are already in court against Binance over tax evasion and money laundering offenses involving $35.4 million. 

The EFCC’s motion later extended its indictment to ByBit and KuCoin, accusing them and several unnamed crypto platforms of enabling Nigerian users to engage in “price discovery, confirmation, and market manipulation” through their platforms, causing “distortions in the market, resulting in the naira losing its value against other currencies.” 

The EFCC’s motion later extended its indictment to ByBit and KuCoin, accusing them and several unnamed crypto platforms of enabling Nigerian users to engage in “price discovery, confirmation, and market manipulation” through their platforms, causing “distortions in the market, resulting in the naira losing its value against other currencies.” 

ByBit remains one of the few cryptocurrency exchanges still offering a peer-to-peer section on its platform, following a crackdown on other exchanges like Binance, which led to the delisting of their peer-to-peer categories. 

ByBit also offers options for crypto trading on its platform and remains a favorite among Nigerian crypto traders. Nigeria’s National Security Adviser (NSA) has classified crypto trading as a national security issue. 

This led to the Central Bank of Nigeria (CBN) ordering five fintech companies—OPay, Palmpay, Moniepoint, Kuda, and Paga—to stop onboarding new customers.  

In response, these fintech companies later announced the prohibition of cryptocurrency or virtual currency transactions on their platforms. 

Under CBN supervision, the fintech companies are now required to report any account trading in cryptocurrency to the NSA through their regulator, the CBN. 

KuCoin’s VAT charge comes amid the Nigerian government’s clampdown on cryptocurrency exchanges and related transactions, which led to Binance exiting the market. 

This crackdown also forced Binance and KuCoin to halt NGN/USD P2P trading on their platforms.