South African telecommunications giant, MTN, is now the subject of probe by Nigerian Senate over an allegation that it illegally transferred $13.92 billion out of the country.
Nigerian senators in the red chamber agreed on Tuesday to begin the investigation and then the senators who resumed this week after a long holiday adjourned plenary till 29 September.
MTN declined to comment on the decision by the Nigerian senate. Nigeria is MTN’s biggest market with over 62 million active subscribers.
MTN shares were down by 4.20 percent, at 2.46 pm (13:46 GMT), on Tuesday.
The allegation was made in a motion submitted to the upper house by Senator Dino Melaye which said $13.92 billion had been repatriated “illegally” out of Nigeria by MTN through its bankers between 2006 and 2016.
The investigation threatens to raise tensions between Nigeria and the South African firm just three months after MTN agreed to pay a reduced fine of 330 billion naira ($1.05 billion) in a settlement with the Abuja government over unregistered SIM cards.
The move comes as Nigeria’s economy plunges into recession for the first time in more than 20 years.
The red chamber agreed that its committee on banking, insurance and other financial institutions would “carry out a holistic investigation into the matter and report back to the Senate”.
MTN is the largest mobile phone operator in Nigeria, which accounts for around one third of the company’s revenues. The company had threatened to pull out of Nigeria during the dispute over unregistered SIM cards.
Melaye representing Kogi West who pressed for the probe said last week: “My respected colleagues, MTN Nigeria paid a sum of 284.9 million dollars on the 6th of February, 2001, to purchase their licence of operations in this country.
“Between 2006 and 2016, through four Nigerian Banks and a serving minister of the Federal Republic of Nigeria, MTN moved over 12 billion dollars out of Nigeria.
“That is about half of our external reserves,” he said.