Nigeria’s Corporate Affairs Commission Chief Accused Of Forcing Small Businesses To Pay Inflated Registration Fees

As Nigeria struggles to keep millions of citizens afloat amid inflation, unemployment, and a shrinking informal economy, allegations of large-scale extortion, abuse of office, and financial impropriety have engulfed the Corporate Affairs Commission (CAC), the country’s business registration agency.

The allegations centre on claims that the Commission ordered fintech companies to collect inflated business registration fees from hundreds of thousands of small business owners across the country.

Multiple sources within the CAC, the fintech ecosystem, and the small business community told SaharaReporters that the Registrar-General of the Commission, Hussaini Ishaq Magaji, SAN, allegedly compelled major fintech companies, including Moniepoint, OPay, and PalmPay, to enforce business name registration on small business owners at rates far above the official government-approved fee.

At the centre of the allegations is a scheme that allegedly saw over 300,000 micro and small business owners forced to pay ₦20,000 each for business name registration, despite the official CAC fee being ₦10,500 at the time.

Sources said the ₦9,500 difference per registration was allegedly diverted to a private “consultant” handpicked by the Registrar-General, raising concerns of large-scale extortion, abuse of office and possible criminal conspiracy.

 Fintechs Turned Into Enforcers

According to multiple industry insiders, the CAC under Magaji’s leadership effectively turned fintech companies into gatekeepers of regulatory compliance, compelling them to ensure that PoS operators and small merchants on their platforms registered with CAC, or face suspension, deregistration or shutdown.

Most affected operators said they were never told that CAC’s official business name registration fee was ₦10,500. Instead, they paid ₦20,000, believing it was “government money.”

A Hidden Consultant and ₦9,500 Per Head

Sources within CAC told SaharaReporters that the extra ₦9,500 per registration did not go to the federal treasury.

Instead, it was allegedly routed to a private consultant appointed outside transparent procurement processes.

The source said, “He used the Central Bank of Nigeria (CBN) to secure a waiver for fintech companies, allowing them to register businesses directly on their platforms with the Corporate Affairs Commission (CAC). Under this arrangement, any PoS operator who wished to register only needed to click a link on the bank’s platform to complete the process.

"However, instead of the applications being submitted directly to the CAC, Magaji ordered that all registrations be routed through a consultant he personally nominated. While publicly claiming that the initiative was meant to support youths and small businesses, Magaji compelled fintech companies to charge N20,000 per application instead of the official CAC fee of N10,500.

"Magaji had an agreement to receive N3,500 from each application processed. With over 300,000 PoS operators reportedly having already registered under the scheme, simple calculations show that the total amount involved runs into several billions of naira," the source explained. 

Another source told SaharaReporters that Magaji has invited fintech companies to a meeting at CAC headquarters, where he allegedly intends to draft a new agreement that would retroactively legitimise the controversial N9,500 surcharge imposed on over 300,000 businesses.

According to CAC source, in November 2024, Magaji reportedly acquired a 2024 Toyota Land Cruiser for about ₦200 million.

"He bought an official vehicle in November 2024, a 2024 Land Cruiser for N200 million. Last month, he bought another Lexus LX600 for N400 million or more."

Petition to Code of Conduct Tribunal

Meanwhile, the Concerned Staff Forum submitted a petition to the Chairman of the Code of Conduct Tribunal on August 19, 2025.

The petition, titled Petition Against the Registrar-General, Corporate Affairs Commission, Hussaini Ishaq Magaji, SAN, on abuse of office, financial impropriety, and alleged commercialisation of promotion and examinations in the Commission, alleged serious misconduct against the Registrar-General.

In the petition, the Forum stated that it was reporting clear and repeated breaches of the Constitution of the Federal Republic of Nigeria and the Code of Conduct for Public Officers by the public servant named above.

The Forum acknowledged and commended the Federal Government’s policy on the “ease of doing business” in Nigeria and the statutory establishment of the Corporate Affairs Commission under the Companies and Allied Matters Act, but it argued that the Commission, as currently administered under the Registrar-General, lacked the institutional environment required to realise these objectives due to alleged high-handedness and disregard for human rights and dignity.

The petition further alleged financial impropriety relating to both local and foreign travel expenses, claiming that payments were approved and made to the Registrar-General for trips that were allegedly not undertaken.

According to the petition, on July 25, 2024, a payment voucher numbered 1230 was issued for travel expenses to attend the 64th Nigerian Bar Association Annual General Conference in Lagos, while on May 6, 2025, payment voucher number 0670, in the sum of ₦2,835,500, was issued for travel expenses.

It also alleged that on May 30, 2025, payment voucher number 0775, amounting to ₦20,896,000, was approved for a study tour to Malaysia, followed by an additional claim of ₦4,860,000 under payment voucher number 0784 on June 3, 2025, described as a refund related to the same Malaysia study tour.

The petition further stated that on June 11, 2025, payment voucher number 0792, amounting to ₦990,000, was issued for travel expenses to Bayelsa State.

As a result of these allegations, the concerned staff Forum called for a probe by the National Assembly, as well as investigations by the Independent Corrupt Practices and Other Related Offences Commission and the Economic and Financial Crimes Commission into fee flows within the Commission.

They also demanded full disclosure of all agreements between the Corporate Affairs Commission and fintech companies, as well as the publication of consultant contracts and procurement records.

The Forum argued that the Commission’s insistence that the crackdown on point-of-sale operators was purely driven by security concerns would remain questionable in the absence of transparency.

They concluded that when regulation disproportionately harms the poor, benefits intermediaries, and resists public scrutiny, institutional trust inevitably collapses, and without trust, no reform, regardless of how well branded or publicised, can endure.

Magaji Reacts To Allegations 

When SaharaReporters contacted Magaji, he explained that the action taken was not because the agency was introducing anything unknown to the law.

According to him, POS operations are guided by what is referred to as the CBN Agent Banking Regulation, which clearly states that POS terminals are issued only to incorporated entities. 

By “entity,” he said, it means a business registered with the Corporate Affairs Commission (CAC), which has the statutory mandate and monopoly to register businesses in Nigeria.

“Our law clearly states that no business can operate without registration. However, many of these operators have been conducting business without being registered. When the law is enforced, operating an unregistered business attracts penalties, including fines,” he said.

He added that instead of enforcing those penalties, the CAC decided to waive them and regularise the operators’ activities by encouraging them to come forward and register their businesses.

“That is exactly what we did. We simply decided to begin implementing the law, something that, for various reasons, had not been consistently enforced over the years,” Magaji stated.

He further explained that whenever a crime occurs in Nigeria, whether money laundering, theft, or other financial crimes, security agencies such as the Police or the Department of State Services (DSS) typically write to the CAC requesting Know Your Customer (KYC) information.

“They ask: who are the people behind this company? CAC is the only institution that holds records of shareholders, directors, proprietors, and beneficial owners,” he said.

Magaji disclosed that there have been cases where ransom payments from kidnappings were made through POS terminals.

“After abducting victims, criminals instruct families to load money onto an ATM card, and the money is then withdrawn using POS machines. When investigators attempt to trace the owners of the POS terminals used to collect ransom, there is often no data available,” he explained.

According to him, once POS operators are registered, the necessary information is already on record, making it easier to identify the registered business to which a particular POS terminal belongs.

“This is primarily a security issue,” he said.

Magaji noted that the exercise received full backing at a high-level government meeting, including support from the CBN, to ensure that POS operators are properly registered.

“There is nowhere in the world where financial transactions take place without the government knowing who is conducting them. It does not make sense for money to move freely without accountability,” he said.

Addressing allegations that the scheme reportedly affected over 300 micro and small businesses, Magaji clarified that CAC recently launched a programme to provide 250,000 free business registrations as a gift to Nigerians.

“We also plan to increase this to one million free registrations before the end of 2026,” he said.

He added that CAC partnered with the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) to provide training and start-up capital, stressing that the goal was job creation, not just issuing certificates.

“This is already in progress. On Friday, we will launch the first batch of beneficiaries. They will be publicly presented, and we invite everyone to come and witness it,” he said.

Magaji stated that the 250,000 free registrations alone amount to over ₦7 billion invested by CAC into small and medium enterprises to boost the businesses of young Nigerians.

He also confirmed attending a meeting with SME stakeholders where it was agreed that 250,000 businesses would be registered for free in collaboration with SMEDAN.

On complaints that POS operators were being asked to pay ₦20,000 instead of ₦10,500, Magaji clarified that the latter was the old rate.

“CAC reviewed its fees around June or July. Officially, the current registration fee is ₦20,000, plus a ₦5,000 availability check, bringing it to ₦25,000. This is not arbitrary; it is the official CAC rate,” he said.

He further clarified that the company registration portal is not owned by CAC, noting that CAC outsources its digital services to a service provider.

Magaji explained that many POS operators are not technologically savvy and find it difficult to navigate the registration process. As a result, some technology companies approached CAC to request API access to enable registrations through their platforms.

“CAC does not compel anyone to register through any specific platform. All we require is that businesses are properly registered and have valid RC numbers,” he said.

According to him, different POS companies charge varying amounts for registration, with some charging ₦35,000, others ₦26,000, or ₦20,000 and above, stressing that those charges are determined by the companies, not CAC.

“The service provider that received API access charges a service fee to those companies. That arrangement is strictly between them. CAC is not involved in how the money is shared,” he said.

Magaji said he had consulted CAC’s audit committee and confirmed that there is no Memorandum of Understanding (MoU) requiring CAC to approve or regulate those additional charges.

“As long as CAC receives its official fee, that is all we are concerned with. Any extra charges are private arrangements between the service provider and the companies using their platform,” he said.

He stated that the matter was open to investigation and urged journalists to verify and audit the claims.

“You will not find me involved in any wrongdoing,” he said.

Magaji noted that as head of CAC, he oversees over 100 services, not just business registration, and that the agency’s objective is to make registration easier, faster, and more accessible without requiring physical visits to CAC offices.

He added that all data collected still belongs to CAC, while the service provider only manages the technical infrastructure.

“The company providing this service is Oasis, a Nigerian firm. They also provide similar services to the Federal Inland Revenue Service (FIRS), including stamp duty collection,” he said.

According to him, Oasis manages the CAC portal, and this arrangement is known to all accredited CAC agents.

“If someone chooses to use their services and is charged a fee, that is a private arrangement. CAC does not dictate or benefit from those additional charges,” he said.