Monrovia – The Central Bank of Liberia (CBL) has moved to clarify details surrounding a new regulatory directive on insurance-backed court bonds, pushing back against public speculation that the measure is politically motivated or aimed at targeting former House Speaker J. Fonati Koffa and other individuals. 

By Selma Lomax selma.lomax@frontpageafricaonline.com

In a statement issued Monday, the Bank emphasized that the directive, officially labeled Directive No. CBL/ID/DIR/001/2025, is the result of a two-year reform process intended to strengthen financial transparency, enhance institutional integrity, and protect the credibility of Liberia’s financial and judicial systems.

According to the CBL, the directive introduces compliance requirements for institutions issuing insurance bonds for court proceedings and does not suspend or prohibit the issuance of such bonds.

The Bank said its primary objective is to ensure that only financially sound institutions are permitted to provide insurance-backed court bonds, aligning Liberia’s practices with international regulatory standards.

According to the CBL, the process leading to the issuance of the directive began in October 2022, when the Supreme Court of Liberia raised concerns about the financial reliability of several insurance companies involved in issuing appellate bonds. 

The Court, the Bank said, warned that these companies lacked the fiscal capacity to honor bond obligations, creating risks for judicial operations and the rule of law. Following that request, the Central Bank said it initiated a thorough consultation process involving multiple stakeholders, including the judiciary, insurance companies, and legal practitioners.

As part of this process, the Bank convened a major stakeholder engagement session on December 23, 2024, where key actors within the insurance sector acknowledged the need for tighter controls. Further meetings followed in early 2025, including a second formal invitation from the Supreme Court on March 4 and the submission of a draft directive on March 7. Additional reviews were held with the Full Bench of the Supreme Court on March 20, and further dialogue took place with insurance brokers and companies on March 25. The final version of the directive was completed on May 2 and officially circulated to stakeholders on May 16, 2025.

The directive introduces a pre-approval process requiring institutions to submit certified audited financial statements and clear all outstanding bond obligations before receiving permission to issue new bonds. 

According to the Central Bank, these measures are designed to prevent bond fraud, ensure proper oversight, and avoid systemic risk to the financial sector.

In light of recent media reports alleging that the regulation was crafted to obstruct the legal defenses of certain individuals facing court proceedings, the CBL issued a strong denial. 

The Bank clarified that the directive does not infringe on constitutional rights, including the right to bail, and does not retroactively apply to previously issued bonds. It stressed that the directive is a forward-looking policy aimed at creating a robust and accountable framework for judicial bonding.

“This reform is about protecting the rule of law and reinforcing public confidence in financial institutions,” the Bank stated in its release. “There is no provision in this directive that targets any individual or political figure. The Central Bank’s actions are guided strictly by its mandate to promote financial stability and ensure effective supervision of Liberia’s financial system.”

The Bank also reaffirmed its commitment to continued dialogue with key actors in the justice system, financial institutions, and civil society. It said these ongoing engagements are critical to ensuring that the new regulatory requirements are understood and implemented without disrupting access to justice or undermining due process.

In addressing the political undertones that have emerged around the directive, the Bank urged media institutions and the public to rely on verified information and to avoid mischaracterizing technical policy decisions as political maneuvers.

The CBL reiterated that its core mission remains focused on maintaining the integrity of the financial system, not participating in partisan debates.

“As a central bank, our focus is not politics. It is financial stability, institutional integrity, and the protection of public interest,” the statement read.

MONROVIA — A directive from the Central Bank of Liberia (CBL) obtained by FrontPageAfrica, has placed a freeze on the issuance of court bonds by commercial banks and insurance companies without prior written clearance from its Insurance Department — effectively preventing several lawmakers currently facing criminal charges, including former House Speaker J. Fonati Koffa, from securing bail.

By Selma Lomax, Selma.lomax@frontpageaffricaonline.com 

The measure, issued on May 16, 2025, under Directive No. CBL/ID/DIR/00112025, mandates that any institution wishing to issue a court bond must first receive formal approval from the CBL’s Insurance Department.

The process requires insurers to submit notarized and certified audited financial statements, along with a full report of outstanding bonds issued prior to any new request.

The directive took immediate effect and has since disrupted the legal process for multiple lawmakers who were recently remanded into custody. These include Koffa (Grand Kru County), Abu Bana Kamara (Montserrado County District #15), Dixon Wlawlee Seboe (Montserrado County District #16), and Jacob C. Debee (Grand Gedeh County District #3). The four were incarcerated at the Monrovia Central Prison Saturday following their second court appearance in connection with a December 18, 2024 arson attack on the Capitol Building.

The lawmakers face charges of arson, criminal conspiracy, criminal facilitation, and attempted murder. Authorities claim the blaze, which caused an estimated $8 million in damages, was politically motivated and planned by senior officials, including Koffa, who allegedly used an aide to carry out the attack.

Under Liberia’s Constitution, all accused persons are entitled to bail, except in capital offenses or where flight risk is established. However, the new CBL directive has created a de facto denial of bail by halting the bond issuance process entirely, despite no court ruling denying bail to the lawmakers.

“No bonds have been filed because no insurance company is currently able to issue one,” said Cllr. Jonathan Massaquoi, legal counsel for the detained legislators. “The restrictions from the Central Bank have paralyzed the bail process.”

Bonds Issuance Directive

Massaquoi confirmed that his clients remain in custody not because of any judicial denial, but because no insurer is willing — or able — to navigate the new compliance burden in time.

Although the CBL’s directive does not reference Koffa or any specific individuals, legal and political observers say its practical impact points directly to the ongoing criminal case, which is increasingly being viewed through a political lens.

“This is no longer simply a criminal matter—it’s political,” said political analyst Sampson Wesseh. “The timing of the CBL directive, and its effect on sitting lawmakers, particularly those in opposition or critical of the current administration, is highly suspect.”

Wesseh added that the directive amounts to an indirect form of detention by financial decree. “When a regulatory agency with no judicial authority effectively blocks access to bail, we’re entering dangerous territory where the separation of powers begins to collapse.”

Other analysts echoed similar sentiments, suggesting the directive allows the executive branch to exert influence over the judiciary via financial institutions.

“If the Central Bank — intended to operate independently — is now involved in a case with political implications, it raises serious constitutional questions,” said one Monrovia-based legal scholar who requested anonymity.

The situation intensified over the weekend when the Monrovia City Court issued a Writ of Ne Exeat Republica barring all five lawmakers implicated in the case — including Rep. Priscilla Cooper (Montserrado County District #5), who has not been detained—from leaving the country.

The writ, granted by Stipendiary Magistrate Ben Barco, directs national security agencies to arrest any of the accused lawmakers attempting to exit Liberia.

While such writs are standard in major criminal cases, critics argue that, when combined with the bond restrictions, it underscores a coordinated attempt to detain lawmakers indefinitely without trial.

“This looks like a calculated legal and financial strategy to silence certain lawmakers,” said a human rights attorney. “It may be constitutional on paper, but it’s questionable in spirit.”

Repeated efforts by FrontPageAfrica to obtain a response from the Central Bank of Liberia have gone unanswered. A formal request for comment was submitted to CBL Executive Governor Henry F. Saamoi, seeking clarification on whether the directive was introduced in response to financial risk concerns or political pressure. As of press time, there has been no official reply.

As the bond impasse continues, the fate of the detained lawmakers remains unclear. Legal teams are reportedly exploring alternative avenues to challenge the directive or seek court intervention. 

Monrovia – A major investigation by FrontPageAfrica has uncovered that Liberia is in danger of losing further assistance from the International Monetary Fund owing to a recent controversial decision by the Central Bank of Liberia to guarantee loans to two struggling banks under the guise of bolstering financial sector stability. FPA has learned that the sticky issue for the IMF and some international stakeholders is that the move was done without proper procedures.

By Rodney D. Sieh, rodney.sieh@frontpageafricaonline.com

The crux of the saga was triggered as far back as August 2020 when Sapelle International Bank Liberia Limited (SIBLL), sealed a deal to take over the GN Bank Liberia Limited, a member of the Group N’doum (GN), headquartered Ghana. That purchase was approved by the Central Bank of Liberia (CBL) recently to operate under the license as SIBLL.

Similarly, in January 2024, Global Bank Liberia Ltd, another struggling bank was taken over by Bloom Bank Africa (Liberia) Limited (BBALL).

During the acquisition of Global Bank, Bloom uncovered the pending suit between Global and businessman George Kailondo Oil and Gas company. The bank insisted they would not purchase due to the pending lawsuit, prompting the Central Bank to step in and sign an MOU to indemnify Bloom if Global lost its legal case against Kailondo. The Supreme Court ruled for Kailondo against Global and awarded him US$2.3 million in damages with the cost of proceedings.

At the time, both purchases were seen as giving a jolt to two poorly run bruising bad non-performing loans.

A Tricky Predicament

In a bid to mitigate the losses during their purchase transactions, the CBL went on to guarantee that it will cover some of the Non-Performing Loans and dole in millions to cover the losses on the FIB-GN Bank—SBLL loans.

Where it gets tricky is that the guarantee is not considered reliable, and SIB had already depleted its reserves to the CBL.

Regarding Global Bank, it was also poorly managed and had bad Non-Performing Loans, and court cases.

Global was then sold to Bloom Bank, but the Central Bank once again provided carte blanche guarantees to cover losses, including a lawsuit against Global Bank by one of its customers, businessman, George Kailondo for damages due to failure to reconcile the customer account. Bloom Bank lost the case, and now the plaintiff is seeking payment.

The CBL is now required to pay an initial amount of $2.3 million (SC) and potentially more for other lawsuits.

Additionally, FPA has learned that the CBL has paid $705k representing 25% to Kailondo. However, there is concern around weak supervision, with a recommendation for the Central Bank to review the liquidity and capital positions of commercial banks daily and not wait until they are in trouble before intervening.

Furthermore, some economists and financial analysts say there is a need for the CBL and the shareholders of the banks to recapitalize based on their liquidity position.

This is why criticisms are being voiced against the CBL’s role in providing guarantees in the name of financial sector stability without proper procedures, suggesting that Executive and Legislative branches should be involved in such decisions.

There is also a growing call for accountability for those breaking the laws and a mention of the reserve requirements policy. All of this has serious implications for the CBL reputation and could negatively affect GOL’s new program with the IMF.

In the wake of all of this, the IMF is reportedly concerned about the process under which the CBL went to guarantee loans to the two banks.

Liberia has been a member of the IMF since March 28, 1962, benefiting from much of the institution’s loans to various projects.

The IMF provides financial support to countries hit by crises to create breathing room as they implement policies that restore economic stability and growth. It also provides precautionary financing to help prevent crises. IMF lending is continuously refined to meet countries’ changing needs.

The IMF lends under concessional and non-concessional arrangements or can provide outright loans. A lending arrangement, which is similar to a line of credit, is approved by the IMF Executive Board to support a country’s economic and financial program. The arrangement requires the member to observe specific terms and be subject to periodic reviews in order to continue to draw upon it.

In recent years, Liberia has benefited immensely from the IMF. In November 2021, the IMF Executive Board approved a four-year Extended Credit Facility (ECF) arrangement with Liberia, with a total access of SDR 155 million (about US$214.30 million). This arrangement allowed for an immediate disbursement of SDR 17 million (US$23.64 million).

As of December 10, 2023, the International Monetary Fund (IMF) had an outstanding loan of SDR 85,000,000 (about US\$110.7 million) to Liberia under its Extended Credit Facility (ECF) arrangement. The IMF Executive Board approved the four-year arrangement on December 11, 2019, with total access of SDR 155,000,000 (60% of quota)

Daunting, Unanswered Questions

The recent allegations involving the CBL issuing guarantees for liabilities in the purchase transactions of two commercial banks without following proper procedures, including Legislative approval raises daunting questions, amid concerns that the liabilities on which the guarantees were issued are due.

Some international stakeholders point out that the issuance of carte blanch guarantees by the CBL Board to cover losses at insolvent commercial banks requires an immediate investigation.

Reports indicate that SIBLL has depleted its reserves with the CBL, while Bloom Bank lost a court case and is facing demands for payment from the plaintiff. Furthermore, there are active lawsuits against Bloom Bank.

Financial analysts say, as the custodian of Liberia’s monetary policy, the CBL is not intended to be a charity institution in the name of financial stability. Furthermore, the Board had no right to issue these guarantees without the proper involvement of the Legislature. The Constitution and laws provide proper procedures for addressing the issuance of guarantees, which should include the Executive and Legislature.

The saga comes as Liberia is currently mired in debt. By the end of December 2022, Liberia’s total debt grew to US$2.03 billion. The external component of the total debt stock constituted about US$1.13 billion(55.85 %) while domestic debt constituted about US$896.68 million (44.15%) according to the 2022 annual public debt and management report.

Additionally, the country’s economic freedom score is lower than the world and regional averages. Liberia’s economy is considered “repressed” according to the 2024 Index.

According to the Index of Economic Freedom: Liberia’s economic freedom score is 49.9, making its economy the 144th freest in the 2024 Index of Economic Freedom. Its rating has increased by 0.3 point from last year, and Liberia is ranked 35th out of 47 countries in the Sub-Saharan Africa region. The country’s economic freedom score is lower than the world and regional averages. Liberia’s economy is considered “repressed” according to the 2024 Index.

Many international observers say, while dealing with stressed banks is a major concern of the IMF, the Fund normally takes a conservative view toward safeguarding public resources. For example, if a bank or financial institution must be saved, it has to be a systemically relevant bank whose failure will occasion ‘systemic challenges’ for the broader banking sector.

IMF Not Up to Speed on CBL Move

Economists opined that for the IMF to buy in on such a ‘rescue plan’ it must meet the full standards of transparency and credible governance, with the FUND being heavily involved, which has not been the case in the ongoing controversy.

The Fund normally digs in deep on the corporate culture of a failing bank to assess whether it is reckless corporate governance that landed the bank into problem, using the financial indicators and data from the bank gauge the causes of the bank’s problems.

For now, it is unclear to what extent the IMF may have been involved in the attempt to rescue SIB if such a rescue has been made.

In recent past, under the former Coalition for Democratic Change administration, the IMF was heavily involved in a systemically important financial institution in which GOL resources were used to salvage the financial institution.

Under the Weah government, the rescue plan was a major pillar of the just-ended IMF program under the CDC administration. Analysts are quick to point out that in order for the IMF to enter a new program under the JNB administration the full details of any loan to SIB would have to be disclosed and the governance around such rescue plan would be overly scrutinized.

The Fund may have to ask several questions: when was this crisis in SIB known since under the CDC IMF program nothing was said about SIB to the IMF? Is this an abrupt overnight banking crisis and if it is not why was data not presented by CBL to the IMF?

More importantly, what is the size of the rescue package and what are the preconditions? Have there been changes in the management of the Bank? The Boakai administration risks entering a program with the IMF if speedy clarity is not provided on these issues. FrontPageAfrica has further gathered that without an IMF, the Unity Party-led administration has no credible chance of macroeconomic stability and international support.

Monrovia —The General Auditing Commission (GAC) has released a compliance audit report detailing significant financial irregularities at the Central Bank of Liberia (CBL) during the period from January 1, 2018, to December 31, 2023. The findings highlight a range of compliance issues that affect the bank’s operations.

By Selma Lomax selma.lomax@frontpageafricaonline.com

Excessive Expenditures and Deficit Financing

The GAC observed that the CBL management exceeded approved expenditure limits from Fiscal Year 2018 to 2022 by approximately $19.31 million. The audit also found that the approved budget expenditure projections consistently surpassed revenue projections, indicating a pattern of deficit financing.

Improper Over-the-Counter Transactions

The audit report disclosed that CBL management cashed several checks over the counter, violating standard banking regulations. Examples include payments of $8,500 to Vision Pro and $8,000 to the West Point Youth Association. According to regulations, institutional checks should be deposited, not cashed directly.

Unauthorized Government Payroll Financing

The GAC identified unauthorized financing activities, including a $50.2 million disbursement to the Government of Liberia’s payroll account on November 30, 2023, and an additional $32.85 million on December 23, 2023. These transactions lacked legislative ratification, contrary to Article 34 d (iii) of the 1986 Constitution of Liberia and Section 46.2 of the CBL Act of 1999. Additionally, there was no evidence of approval from the CBL Board of Governors.

Staff Loan Default Irregularities

The audit found significant issues with the management of non-performing staff loans, totaling US$472,053 for separated staff and US$240,634.80 for seconded staff. Notable defaulters include former Finance Minister Augustine K. Ngafuan, owing $5,091.29, and Sinoe County Senator Crayton O. Duncan, owing $44,924.43. The GAC noted a lack of repayment, absence of legal action, and missing documentation for these defaulted loans.

Potential Money Laundering Concerns

The GAC report raised concerns about potential money laundering, noting that CBL facilitated payments totaling L$1.946 billion and US$178.33 million above approved thresholds. These payments, made to institutions via individual names, included large sums such as US$121 million for the National Security Agency and US$23 million for the Executive Protection Service.

Unapproved Legal and Consultancy Expenses

Significant legal expenses amounting to US$742,120 were disbursed to staff for subsequent payment to consultants, despite the CBL having an internal legal department and contracted legal firms. Additionally, unsolicited payments exceeding approved amounts were made, including US$1,084,027 for Corporate Social Responsibility initiatives.

Lack of Competitive Bidding in Procurement

The report highlighted that contracts totaling US$11.08 million were awarded without competitive bidding, lacking appropriate procurement documentation such as bid evaluation reports and contract award notices.

Conclusion and Recommendations

The GAC concluded that the CBL’s operations were not in compliance with the 1986 Constitution of Liberia, the Public Procurement and Concessions Act of 2005, and other relevant regulations. The GAC urged the House of Representatives and the Liberian Senate to urgently implement the recommendations provided in the report.

The findings highlight significant lapses in financial management and oversight at the CBL, calling for immediate corrective actions.

MONROVIA — Despite the bad state of Liberia’s economy, FrontPageAfrica has in its possession a list of partisans of the ruling Unity Party (UP) recommended to the governor of Central Bank of Liberia (CBL) for employment, a move that will further bloat the size of government at a time of general clamour for cutting down on the cost of governance.

By Selma Lomax, Selma.lomax@frontpageafricaonline.com

In a communication sent to Aloysius Tarlue, dated April 23, 2024, UP’s chairman, Luther Tarpeh, approved the names of 13 persons, bringing the total number of recommended party’s faithfuls to 32 for appointments at the CBL, FrontPageAfrica gathered. 

FrontPageAfrica gathered this is not the only place that Tarpeh, board chairman of the National Port Authority, has recommended partisans of the party for jobs after rumors surfaced on social media of him recommending the appointments of 43 persons in total at the Liberia Petroleum Refinery Company, Ministry of Labor, and Ministry of Finance, respectively. Boakai’s predecessor, George Weah, was criticized for appointing partisans of his Coalition of Democratic Change into government even in an economy that was already nose diving into a recession. During the Weah administration, it was reported that the CBL was pressured to employ all of the CDC partisans that were recommended by the party. Then Executive Governor Nathaniel Patry infamously admitted that he received a list of people from the CDC for employment.

The Unity Party, while in opposition, said the former president’s decision to bloat the government’s payroll was the main reason the country was faced with revenue to cope with the requisite infrastructure and salary commitments.

FrontPageAfrica gathered it’s not only Tarpeh who is recommending partisans to government ministries and agencies, many including Bong County senator Prince Moye, Montserrado County senator Abraham Darius Dillon, Pro Tempore and Senator Nyonblee Karngar-Lawrence, among others.

Liberians say they had expected that the prevailing economic climate would compel governments at all levels to seriously cut down the cost of governance by scrapping or merging ministries and departments that could effectively handle the various sectors of government. That way, they added, governance would be smarter and more result-oriented.

Apart from the huge amount that will be spent in servicing this crowd of political appointees in a debt-riddled economy, political pundits say Unity Party’s manner of over-bloating the government is bound to elicit other consequences down the road ahead. 

Some Liberians are questioning why the government continues to get bloated with partisans of the UP when the country is among the top 10 poorest countries in the world, according to Global Finance magazine 2024.

“The cost of governance is too high,” Alex Flomo, a civil society activist, said.  He said Liberia is certainly living above its means with the rising recurrent expenditure.

“Liberia has ignored its revenue challenge by going on a recurrent expenditure spree. Yet, this has not impacted the economy, which has been stuck in a low growth path despite higher cost of governance,” Flomo said.

MONROVIA —  President Joseph Nyuma Boakai has directed the General Auditing Commission (GAC) to conduct a comprehensive audit of three key government institutions, including the Central Bank of Liberia, the National Security Agency (NSA) and the Executive Protection Service (EPS).

President Boakai, in a communication to the Auditor General of the GAC, requests that the audit covers the period between 2018 and 2023, and that it the findings be reported in three months.

The audit period spans the six-year stewardship of the Weah-led government, which President Boakai promised to audit as President.

The audit of the three institutions marks the beginning of a holistic audit of government ministries and agencies in keeping with the President’s commitment to fighting corruption as well as ensuring transparency and accountability in the governance of the country.

President Boakai at different public engagements, most notably, the campaign period, the inaugural address and the annual message committed and recommitted to ensuring that a comprehensive audit of the previous government is done.

During his Annual Message, President Boakai announced that what his predecessor reported on the state of the country’s financial standing at the CBL was far from reality based on documentary records and re-emphasized the need to audit the CBL and other agencies.

“The net international reserves position reported at the end of December 2023 was US$220 million. The report of US $40 million as the GoL’s consolidated account balance as at January 19, 2024 is not supported by the fact. The balance reported by the CBL as of the same date was US$20.5 million, highly encumbered, NOT US$40 million,” President Boakai announced during the Annual Message.

He furthered that “to this end, we re-emphasize our earlier commitment to audit and ensure that regular audits will be a culture across all branches of government, not only the Executive.”

It will also be the first time in years that the EPS and NSA, two security entities that receive budgetary allocations, are being audited.