Falana shared this during an interview on Channels Television on Friday.
It should be noted that the apex bank directed Deposit Money Banks to allow the Naira to float freely against the dollar and other international currencies in June.
In Falana's view, the CBN's move to float the Naira is "illegal" and is being contested in court. He emphasized that there is no provision for floating the Naira and that the decision contradicts the law.
He elaborated, "I’ve had to sue the Central Bank of Nigeria at the Federal High Court because Section 16 of the Central Bank Act has imposed a duty on the Central Bank to fix and determine the rate of the Naira vis-a-vis other currencies."
As of Friday, the CBN has set the exchange rate between N744 and N746.
Falana, a Senior Advocate of Nigeria (SAN), pointed out that the CBN Act mandates the central bank to establish the exchange rate. He highlighted that according to Section 20(1) of the CBN Act, the only legal tender in Nigeria is the currency notes issued by the Central Bank, which is the Naira.
Furthermore, Section 20(5) of the Act stipulates that anyone who uses any other currency in Nigeria without the central bank's approval has committed an offense "and shall be prosecuted." The penalty for this offense is six months of imprisonment.
Falana argued that unless government officials are committed to strengthening the Naira and making it the exclusive legal tender in Nigeria, the nation's progress will be hindered.
Regarding the Federal Government's approval of N5 billion for each state and the Federal Capital Territory (FCT) to purchase food items for distribution to the needy, Falana labeled these actions as diversionary. He argued that these measures are temporary and do not address the core issue, which he identifies as the dollarization of the economy. He stressed that any relief measures announced will ultimately be eroded by the impact of the dollarization phenomenon.
