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President Orders Audit of Liberia's Central Bank: A Tug of War Over Money and Rules

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louis Buyisiwe

Feb 27, 2024

Exploring the Legal and Financial Tensions Behind the Presidential Directive in Liberia

A detailed overview of the controversy surrounding the Central Bank of Liberia's loan decisions and the ensuing presidential audit, highlighting the legal and governance issues at play.
Liberia's Central Bank Under the Microscope Following President Joseph Boakai Audit Order

The recent presidential order in Liberia to audit the Central Bank has ignited a significant debate over the legal boundaries and the bank's autonomy. President Joseph Boakai mandated the General Auditing Commission (GAC) to audit the Central Bank of Liberia (CBL), raising questions about the legality of this directive, the GAC's authority to audit the CBL, and the potential impact on the CBL's independence.

This action is part of a broader anti-corruption drive by President Boakai, who has committed to fighting graft and enhancing transparency in government institutions, including the central bank, the national security agency, and the executive protection service, focusing on the period from 2018 to 2023​​​​​​.

The debate centers around the interpretation of the GAC Act, specifically whether the CBL's operations are considered "public accounts" or "public funds" as defined by the Act, and thus, whether they fall within the GAC's audit jurisdiction. Critics argue that the presidential order contradicts the CBL Act, which outlines the bank's independence and its authority over internal and external audits. They point to the Act's provisions, which mandate regular audits by the Chief Internal Auditor of the CBL, the appointment of external auditors by the Board of Governors, and oversight by an independent Audit Committee, all designed to protect the CBL from undue influence​​.

In contrast, proponents of the audit argue that the presidential directive falls within constitutional powers to ensure accountability in government institutions, emphasizing that the CBL's autonomy does not exempt it from external scrutiny, especially concerning financial management and accountability​​.

This situation highlights the ongoing tension between the need for transparency and accountability in government institutions and the preservation of the autonomy of key financial institutions like the Central Bank of Liberia.

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