… threaten fresh lawsuit
- CBN, Union Bank keep mum on scandal
- Former CBN gov, dep gov react
Following last Monday’s expose on a 2.556billion pounds sterling private sector investment funds, allegedly illegally withheld by the Central Bank of Nigeria and Union Bank of Nigeria Plc, published by The Point, human rights activists, civil society groups and former heads of the CBN, have called for thorough investigations into the matter, with a view to saving the image of the country and restoring investor confidence.
In separate reactions to the story, which elicited strong debates last week, many of them maintained that there could not have been a public judgement without clearly argued facts.
The Point had exclusively reported that the withheld fund, said to have been raised by Petro Union Oil and Gas Company Limited and its partners in 1994, and meant for the construction of an export-oriented refinery in Nigeria as advised by the Federal Government, became a subject of protracted litigation, which also reportedly culminated in the untimely death of the Chief Executive Officer of the company.
The President has to look into it; if he does not, it will be a very bad thing for his government because he is the Head of State. He is supposed to look into it and see how it can be resolved
According to documents obtained by our correspondent, the fund was transferred and lodged in Petro Union’s account with Union Bank Plc, through a Barclays Bank Cheque number 010140, dated June 3, 1994, on the orders of Gladstone Kukoyi Associates, the financial and management consultants to Petro Union on the project.
Our correspondent gathered that the CBN and Union Bank had refused to release the fund to the investment company, despite three authoritative positions, including a ruling of an Abuja Federal High Court, ordering the apex bank and Union Bank to pay the sum to the claimant.
In his reaction, a former Director General of the Abuja Chamber of Commerce and Industry, Dr. Chijioke Ekechukwu, expressed the fear that the development could discourage other foreign investors from considering investing their funds in Nigeria.
Ekechukwu said that the government had the responsibility to protect legal and genuine foreign investors’ funds.
He added that failure to do the necessary things to protect genuine foreign investors would put the economy at a risk of losing genuine foreign investments in the country.
“Provided that the money is genuine, Nigeria must protect foreign investment funds in the country. The implication of trapping genuine funds are weighty because other foreign investors will be discouraged from investing in Nigeria because they would obviously not want their funds to be trapped in Nigeria,” Ekechukwu said.
The former DG also frowned on the alleged disregard of the CBN and Union Bank for court judgment on the seized fund, saying that this position had negative consequences for the nation’s economy.
He stressed that the essence of the Federal Government’s Economic Recovery and Growth Plan (ERGP) was partly to encourage Foreign Direct Investment in the country, adding that government removed bottlenecks in order to ensure hitch-free FDI.
I don’t think that could have happened. Anyone can secure a court judgement but a higher court can rule otherwise. Talk to the CBN, they need to investigate the matter to put the records straight
Ekechukwu explained that part of the objectives of the ERGP was to ease doing business in Nigeria, adding that the aim of the policy was to provide a level-playing ground for everybody, including foreign investors.
“Any action or activity of any individual or institution of government that constitutes a threat to this objective of the ERGP is not working in the interest of economic growth and development and must be called to order,” he said.
Speaking in the same vein, the National President, Civil Liberties Organisation, Comrade Kenny Bakare, said the impression created by the CBN management and the Union Bank regarding the allegedly seized foreign investor’s fund would greatly dent Nigeria’s image in the international business arena.
Bakare enjoined the Presidency to probe the matter.
He said, “That will be a very bad impression, if the court has ruled that the money should be returned. The best thing is for the CBN to respect the rule of law and return the money.
“The President has to look into it; if he does not, it will be a very bad thing for his government because he is the Head of State. He is supposed to look into it and see how it can be resolved.
“If those in the current CBN think they are not concerned about it because it was not perpetrated by the set of people there now, that is very wrong. CBN is CBN; it is not a personal thing. I think Buhari himself should rise to this occasion, if he is serious about fighting corruption in this country.”
Also, a human and economic rights activist, who is also the President, Consumer Advocacy Foundation of Nigeria, Mrs. Sola Salako Ajulo, who spoke from the point of the law, noted that it was disappointing for a government institution to disregard a valid court ruling, even when it had not appealed against the judgment.
Ajulo, a renowned integrated marketing practitioner and astute consumer advocate, who was recently appointed into the Lagos State Consumer Protection Agency, vowed to “ensure justice in commercial transactions by educating, advocating and creating awareness for consumer rights and protection in Nigeria.”
“Under the circumstance, the company (Petro Union Oil and Gas Co Limited) needs to go back to the court to state that the CBN and UBN have refused to comply. When this is done according to the rule of law, the court can issue a subpoena insisting that the heads of those government departments should be brought before it to explain why they did not comply with court orders,” she said.
Similarly, the President, Paths of Peace Initiatives, a civil rights group, Comrade Dandy Eze, said President Buhari should immediately intervene in the matter and ensure that the CBN and the UBN “do the needful on the case.”
He added that a fraudulent act by the apex bank could mean that no bank in the country was free of corrupt practices, which called for a thorough investigation.
“If CBN can be involved in this case, that means all banks in the country are full of corrupt practices and this is a great danger for all. Concerning this, the President should immediately intervene and ensure that the CBN obeys the court judgement on the case. It is so pathetic that every sector in this country is enmeshed in corruption, despite the fight against the menace,” he lamented.
Eze also warned that civil right groups would not hesitate to take legal action against both the CBN and UBN, if they failed to refrain from tarnishing the image of the country by such “disappointing roles.”
“We, human right groups, will not hesitate to take legal action against them in CBN and UBN, if they fail to stop painting the country in bad light by their illegal conduct regarding this matter,” he said.
CBN, UNION BANK KEEP MUM
However, the managements of both the CBN and Union Bank might have begun separate investigations to unravel the circumstances surrounding the alleged seizure of the investor’s funds, our correspondent gathered.
But both the apex bank and the UBN have kept mum on the matter, refusing to answer our correspondents’ enquiries.
Efforts by our correspondents, throughout last week, to confirm the probes launched by the two banks on the controversial matter were unsuccessful.
The spokesperson of the CBN, Mr. Isaac Okorafor, did not pick any of the several calls made to his phone by our correspondents, both in Abuja and Lagos. He did not also respond to text messages sent to him as at press time.
Similarly, the UBN declined to respond to our correspondents’ enquiries on the probe of the matter as at press time.
In a petition to President Buhari, dated 15th May, 2018, a copy of which was obtained by our correspondent, Counsel to the investment company, Itseuwa H. Unoakhe and Co, said the company’s instruction was for Union Bank to secure the CBN’s approval for the ‘trapped’ money, adding that Union Bank received the instructions and all documents, including the instruments for the investment capital.
The petition, titled, “A plea for Presidential intervention against denial of justice, unlawful withholding of foreign investor funds, stealing/fraudulent conversion of #2,556,000,000 only and accruing interest of 25 per cent since 1994 to date, perpetrated by Union Bank Plc and Central Bank of Nigeria on the investment funds belonging to Petro Union Oil and Gas Company,” appealed for the President’s kind intervention over the “long standing case of official fraud and privileged cover up by certain officials in the public and private sectors of our economy.”
While proving that the funds were seized without explanation by both the apex bank and Union Bank, the Counsel said, “Union Bank subsequently wrote back to our clients on 29th June, 1994 to indicate that it was transmitting the investment funds to the CBN, but in a rather bizzare and unlawful fashion, it withheld the sum of #396,778,861.46 without a valid explanation.
“Curiously, despite having knowledge of the extant laws of the land, in respect of such transactions, the Union Bank of Nigeria Plc went ahead and transferred the investment funds of our clients in the sum of #2,159,221,318.54, less #398million to the Central Bank of Nigeria, and the CBN acknowledged receipt of the said fund vide: CBN Statement of Account No. GR/2007/466716 of 01/09/95 in line with Authority No. X/194683/1/115, dated 22/06/95.”
In a March 2014 ruling, obtained and confirmed by our correspondent at the Abuja Federal High Court, Justice A. Abdu-Kafarati condemned the actions of the CBN and UBN.
“From the processes before me, I feel satisfied that the applicant has proved its case against the respondents,” the judge said while granting five of the claimant’s reliefs as prayed.
In an order of mandamus, the Federal High Court compelled CBN and Union Bank to “release forthwith and transfer to the applicant her foreign capital of #2,556,000,000.00 (two billion, five hundred and fifty six million British Pounds Sterling) presently in the unlawful custody of the first and second respondents.”
FORMER CBN GOV, DEP GOV REACT
Responding to our correspondent’s enquiries, a former Governor of the Central Bank of Nigeria, said if truly such a judgement had been given, the CBN should have appealed.
He wondered why the litigants had not applied for an order to compel the CBN and the Federal Government to obey the order.
“Just saw the heading and sounds curious. 2.5billion pounds? CBN did not appeal such judgement? Why appeal to the President? I really don’t know what it is about … Why haven’t the litigants applied for a garnishee order to compel the CBN and govt to obey the judgement?” he asked.
Meanwhile, a former Deputy CBN governor, who, at first declined to comment, and later spoke in confidence with our correspondent, said processes in the present CBN would not allow such to happen.
He said for such foreign transfers, CBN would have appointed an external bank.
He, however, called for a detailed probe into the matter to unravel the truth, saying, “I don’t think that could have happened. Anyone can secure a court judgement but a higher court can rule otherwise. Talk to the CBN, they need to investigate the matter to put the records straight.”
