The Socio-Economic Rights and Accountability Project (SERAP) has taken legal action against the Central Bank of Nigeria (CBN) for allegedly refusing to provide details on financial allocations made directly to Nigeria’s 774 local government councils. This lawsuit follows a landmark Supreme Court decision in July 2024 mandating that funds from the Federation Account be sent directly to democratically elected local councils, not managed by state governors.
In a suit filed last Friday at the Federal High Court in Lagos (Suit No. FHC/L/MSC/521/2025), SERAP is seeking a court order compelling the CBN to disclose all direct transfers made to local governments since the ruling. The group also wants the bank to confirm whether any such payments have been made specifically to local governments in Rivers State and to provide justification for any such disbursements.
The advocacy group argues that transparency around these payments is essential for ensuring public accountability and that failure to disclose such information undermines the rule of law and the Supreme Court’s authority.
“The CBN is constitutionally obligated to ensure that public funds are disbursed in line with legal mandates. Citizens deserve to know how much is being allocated to their local councils,” SERAP said in the suit, filed by legal counsels Kolawole Oluwadare and Oluwakemi Oni.
In July 2024, the Supreme Court ruled that state governors and the Minister of the Federal Capital Territory had no legal right to control funds allocated to local governments. The Court described the long-standing practice of withholding or diverting such funds as unconstitutional.
Following the ruling, reports emerged that the 774 local councils across the country were instructed to open dedicated accounts with the CBN to receive direct transfers from the Federation Account. However, implementation appears to have stalled, prompting fears that state governors are continuing to exert control over the funds in violation of the Court’s decision.
SERAP’s legal move comes amid broader concerns that the financial autonomy of local governments is still being undermined. The group cited past remarks by former President Muhammadu Buhari, who disclosed that in some cases, local government chairpersons are forced to sign off on inflated allocations and return the excess to state authorities.
“If N100 million is sent to a state, the chairman might receive only N50 million, after being made to sign for the full amount,” Buhari said in a 2022 interview, highlighting the depth of the issue.
Additionally, recent data from the Federation Account Allocation Committee (FAAC) revealed that a total of ₦1.578 trillion was distributed among federal, state, and local governments in March 2025. Yet, it remains unclear how much of this reached local councils directly as required by law.
SERAP insists that compelling the CBN to release this information will reinforce democratic values and ensure public institutions comply with court orders. They warned that continued defiance of the Supreme Court by state actors threatens the integrity of Nigeria’s judicial system.
