The Office of the Auditor-General of the Federation has accused the Central Bank of Nigeria, under former Governor Godwin Emefiele, of re-circulating dirty and unfit banknotes valued at N29.77bn in 2022. The new allegation is contained in the Auditor-General’s Annual Report on Non-Compliance and Internal Control Weaknesses in Ministries, Departments and Agencies for the year ended December 31, 2022. According to the report, the apex bank released banknotes already categorised as “Counted Audited Dirty” across several branches, despite a formal policy that forbids such practice.
The Clean Note Policy Version 0.1 (2018) clearly states that only fit and authenticated notes may be issued to the public, while unfit notes must be destroyed and removed from circulation. However, the audit revealed that the CBN violated this policy between April and December 2022. The Abuja branch alone re-issued N28.615bn of the condemned notes between October and December 2022. The Lagos branch released N970m in December 2022, Bauchi branch re-issued N30m in April 2022, and the Jos branch released N50m and N100m in May 2022.
According to the audit team, a total of N29.765bn in dirty notes was pushed back into circulation. The auditors warned that this action exposed the country to reputational damage and reduced the durability of Nigeria’s currency. They also blamed weak internal controls at the Central Bank for the breach and stated that the findings would remain valid until corrective action was taken.
Across the four CBN branches involved, explanations varied. The Abuja branch said the COVID-19 pandemic created operational disruptions and forced the circulation of dirty notes during a period of cash scarcity. The Lagos branch linked its breach to heavy cash demand during the 2022 Christmas season. The Jos branch claimed the re-issuance was necessary due to military cash requests during insecurity operations. Bauchi branch denied issuing unfit notes at all. The Auditor-General rejected all explanations as “not satisfactory.”
The report recommended that the National Assembly’s Public Accounts Committees should summon the CBN Governor to explain the breaches and apply sanctions under Financial Regulations where necessary. The regulations outline penalties for gross misconduct by public officials and failures in financial management.
The findings come at a time when former CBN Governor Godwin Emefiele is already facing several corruption-related cases in different courts. Although the audit does not directly indict him by name, it places responsibility on the CBN’s leadership during the period and notes that the failures in currency management occurred under his administration. Emefiele is currently facing a major 19-count fraud charge in Lagos and an amended 20-count procurement trial in Abuja, along with other foreign exchange and corruption cases at both Federal High Court and FCT High Court.
The audit report also highlighted a separate issue involving the delayed destruction of unfit banknotes. Findings showed that 997 boxes of N10 notes valued at N99.7m and 695 boxes of N500 notes valued at N3.475bn had not been destroyed as of October 2023. The older notes had already been certified unfit—some since late 2021—but remained stored in vaults because briquetting and disposal processes were delayed. In total, N3.57bn worth of condemned notes accumulated in CBN custody, raising concerns about pilferage, loss of public funds and inefficiency in currency management. The CBN responded that destruction activities had begun, but auditors again rejected this explanation and maintained their findings.
The source had earlier reported in April 2023 that bank workers and customers had complained about the quality of the old naira notes being reintroduced into circulation by the CBN. Bank tellers and cash-handling staff expressed fears that the dirty and mutilated notes could spread diseases, noting that many of the reissued notes were already in poor condition.
The audit also noted that the circulation of dirty notes in 2022 coincided with the controversial naira redesign policy announced on October 26, 2022. The rushed implementation led to severe cash shortages, legal battles and a Supreme Court ruling that later extended the use of old notes after the initial deadline collapsed. Analysts say the new audit findings add to the long list of concerns raised over the former CBN leadership’s management of Nigeria’s currency and monetary policies.
The Auditor-General’s office said the re-circulation of unfit notes must never happen again and urged lawmakers to enforce stronger accountability in the Central Bank’s operations. The report stressed that Nigeria’s currency management system must be transparent, efficient and compliant with established regulations.
