Economic Confidential

The year 2012 fulfilled its promise to be one of the most dramatic ever for Nigeria.  It was a year of scandals, financial and moral, culminating in the global anti-corruption body- Transparency International (TI) declaring Nigeria as the 37th most corrupt nation on the planet.  It was on the 139th position of the 176 countries polled. From that first day of the year, which was a Sunday when around noon, fuel stations stopped dispensing premium motor spirit(PMS) to adjust their metre from N65/litre to between and N143/litre across the country, there was never a dull month or week in the next 365 days. It was a leap year too.

The hike blew open several revelations of decades of unmitigated fleecing of the country by a select group of the topmost elite. As a result of the controversy, Nigerians learnt from such prominently knowledgeable personalities like former petroleum ministers Tam David West and Muhammadu Buhari that even at N65/litre, the Federal Government was making profit on sale of refined petroleum to citizens and so, claims of subsidy on PMS was false. According to a widely publicised analysis, David West concluded that pms ought to be sold for N40.02 and that even at their dilapidated state, the four refineries at Kaduna, Warri and port Harcourt are capable of meeting local consumptions.

Also, increasing massive nationwide protests against the hike forced the House of Representatives to convoke an emergency session and set up an ad-hoc committee to investigate fuel subsidy regime. The panel discovered massive looting through the scheme and in its report, laid on April 18, 2012 found that “the subsidy regime, as operated between the period under review (2009 and 2011), were fraught with endemic corruption and entrenched inefficiency. Much of the amount claimed to have been paid as subsidy was actually not for consumed PMS.  Government officials made nonsense of the PSF Guidelines due mainly to sleaze and, in some other cases, incompetence. It is therefore apparent that the insistence by top Government officials that the subsidy figures were for products consumed was a clear attempt to mislead the Nigerian people.” It then recommended that N1, 067,040,456,171.31 (N1.067 trillion) be refunded to treasury as excess claims by NNPC, PPPRA, and petroleum marketers.

Chairman of the ad-hoc committee was Alhaji Farouk Lawan, a member from Kano State who has served since 1999. Only a few weeks after the committee submitted its report, reports broke that Lawan himself demanded and obtained bribe from many marketers that he probed. Chairman of Zenon Oil, Mr. Femi Otedola alleged and showed recordings where Lawan demanded the bribe money.

Dissatisfied, Minister of Finance, Ngozi Okonjo-Iweala also set up another panel headed by Access Bank managing director, Aigboje Aig-Imoukhuede on the same issue. The committee in its report however, said only N382 billion was stolen and should be recovered from marketers.

Still on the same issue, Minister of Petroleum Resources, Diezani Alison- Madueke also constituted a Petroleum Revenue Special Task Force with former Chairman of the Economic and Financial Crimes Commission Mallam Nuhu Ribadu as chairman.

The 178 page report, which was obtained by the Economic confidential magazine, revealed how NNPC spent money without appropriation on issues like N2.23billion on a chopper for the president, sponsorship of the World Cup; N700.5 million as loan to Sao Tome & Principe; payment of N2.421billion to Royal Switzerland Sugar Company; underwriting of N521million expenses incurred by the Federal Ministry of Petroleum Resources in addition to the N250million spent on court cases involving the ministry. The panel also discovered that NNPC The committee also found that the NNPC incurred a N20billion spending on the Presidential Implementation Committee on Maritime Safety and Security; and discovered discrepancies in the management of about $1billion in signature bonuses, as well as in other payments by NNPC. Debts from oil companies were unaccounted for by the NNPC and the Department of Petroleum Resources among other messy dealings.

Perhaps more scandalous was the discovery that the Federal Government had planted spanners in the wheels of the committee by appointing some of its members into juicy positions in the oil industry. It then became a matter of some committee members probing themselves.

Within the year also, the national Assembly discovered that the NNPC made an unapproved excess expenditure of N48 billion within the year from a secret cash reserve that it maintains.

At the budget defence session towards year end, it was discovered that the Petroleum Pricing and Regulatory Agency (PPPRA) spends N5.2 billion annually on less than 250 staff. Members of staff of the agency and its management also share the 15 kobo it collects on every litre of petrol among them. Many Nigerians believe this is official corruption. It will appear as if on the average, a staff of PPPRA earns N20.8 million per annum in addition to other allowances.

By the middle of the year, it was also revealed some Federal Government officials facilitated the illegal transfer of about N155 billion to Malabu Oil from public coffers. The House of Representatives is still probing the matter.

Another scandal broke out involving the House of Representatives Committee on Capital Market and the Securities and Exchange Commission (SEC) which was also widely reported by the Economic Confidential. The Committee had announced a public hearing on activities of the market to determine how it can be saved from continuous freefall. As is expected of such efforts in a corrupt atmosphere like Nigeria, revelations began pouring in about shady deals in SEC and about how its Director General Ms Arunma Oteh had turned the commission into her personal empire. Suddenly, Oteh fired back, accusing committee Chairman, Herman Hembe of being angry because of her refusal to honour demands for bribe. She also accused Hembe of collecting money for a phantom conference abroad. It was really a big scandal. Hembe stepped down from his position in the committee and is currently being tried by the EFCC. Oteh on the other hand was backed to the end by President Jonathan and Dr. Okonjo-Iweala. She remains in her position despite the weighty allegations.

In September, a Paris court fined electronics group SAFRAN 500,000 euros for bribing Nigerian officials to obtain an ID card contract in 2002/2003. SAGEM, a company that merged with SNECA in 2005 to form paid the bribe in exchange for contract from Ministry of Interior. Former President Olusegun Obasanjo who blew the whistle said Sagem paid bribes and presented gifts, including Rolex watches to Nigerian officials to secure the contract. Those accused included late Chief Sunday Afolabi who was Minister of the Interior in 1999, his successor, Mr. Mohammed Shata, former Labour Minister, Hussain Akwanga and others on charges that they had sought bribes worth about N320 million ($2million) from the French firm, Sagem in connection with the $214million contract to produce identity cards. All the accused persons were granted bail on December 31, 2003. Nothing has been heard of the case since then until the French court ruling.

The incident is similar to that of former delta State Governor James Ibori. On April 17, Ibori was sentenced to a 13 year jail term by a London court for corruption and money laundering. Meanwhile in December 2009, a Federal High Court sitting in Asaba had discharged and acquitted Ibori of the same offences to which he now pleaded guilty and sentenced by the London court.

In April, Atiku Abubakar Kigo (a Permanent Secretary), Ahmed Inuwa Wada (Director), John Yakubu Yusuf (Assistant Director), Veronica Onyegbula (Cashier) and Sani Habila Zira (ICT Officer) were discovered to have stolen N32.8bn from the Nigeria Police Pensions funds.

The revelations came during a public hearing conducted by the Senate Joint Committee on Public Service, Establishment and State and Local Government Administration probing alleged corruption in the management of the pension funds.

The suspects were alleged to have stolen N24 billion of the police pension fund through falsified documents. The amount was withdrawn from the Budget Office for a pension payment that required just N3.5 billion. It was also revealed that whereas N5 billion was paid to the Office of the Head of Service monthly for the payment of pensions, only N1.9 billion was actually required.

Again, while 141,790 pensioners were registered and listed on the government’s payroll, only 70,657 were genuine pensioners. It was also revealed that although the Police Pensions Office collected N5 billion monthly as claims for its pensioners,  it actually needed N500 million. Illegal withdrawals were made by staff using multiple cheques in fictitious names in excess of 30 cheques per day to withdraw cash from their bankers amounting to over N14 billion.

Some of the looted funds, the Economic confidential gathered, had already been recovered with one staff of Police Pension Office reportedly returning N1 billion cash while another surrendered three luxury estates which consist of about 27 blocks of deluxe flats he built in Abuja. N2 billion cash was recovered from a house belonging to a suspect, while hotels and fuel stations belonging to other suspects have been confiscated by law enforcement agencies.

However, leader of the Pension Reforms Task Team (PRTT) instituted to curb the malpractices, Abdulrasheed Maina, was himself accused of spending N240 million on a biometric exercise for less than 20 retirees in the Diaspora and another N220 million on the local bio-data. He was also alleged to have unilaterally opened three accounts in different banks without recourse to extant financial rules and approval from relevant authorities. One of the accounts was domiciled in the account of his younger brother with a huge monthly interest of over N100 million. Maina claimed the money was spent on allowances for foreign trips by 85 officials engaged for the exercise, including top civil servants, top police officers and those of the  Economic and Financial Crimes Commission, EFCC. To crown it all, Chairman of the committee probing the scams, Senator Aloysius Etok, and his members were equally accused of demanding bribes from the same pension task team.

At the Nigerian Printing and Minting Corporation simply called the MINT,  some N2.1 billion of newly printed N1,000 notes was discovered to have developed wings and flew away. The company’s Managing Director Ehi Okoyomon and Head of Security, Emmanuel Bala was sent on compulsory leave. As at the end of the year, nothing more had been by the public over the investigations said to be ignited concerning the issue.

In addition to financial scandals, the Economic Confidential dicoverred that employment scandal also rocked many government agencies. It was blown open that some officials were obtaining bribe of as much as N250,000 to offer employment to individuals. At the Nigerian Immigration Service, jobs slots were secretly allocated to top government officials. Controller General of the Service, Mrs. Rose Chinyere Uzoma, was also accused of favouring her kinsmen from the Southeast in the distribution of the vacancies.

Defending her decision to recruit secretly, Uzoma told lawmakers that the service did not advertise the jobs so as not to employ terrorists. Of the over 25,000 Immigration staff, Imo has 1,190; Kano has 350; Lagos has 400; while Sokoto has the least of 200.

Also at the Nigerian Security and Civil Defence Corps, 6000 people were secretly recruited. Most of those recruited obtained letters from the high and the mighty in the society especially from members of the National Assembly, ministers, special advisers and other government officials.