By Sam Akpe:

• Unregistered Firms Used In Buying Property

Severe acts of irregularity committed by the Economic and Financial Crimes Commission (EFCC) under its former chairman, Nuhu Ribadu, during the sale of forfeited properties of former Inspector General of Police, Tafa Balogun, have been revealed.

Balarabe Musa

Balarabe Musa

Further procedural defects have also been identified by a committee set up by the EFCC chairman, Farida Waziri, to study the position and disposition of assets forfeited to the Federal Government during the investigation of former governor of Bayelsa State, Diepreye Alamieyeseigha among others.

The committee observes that officers of government statutorily required in execution of such legal mandate were deliberately left out, thus contravening certain provisions of the EFCC Establishment Act and Financial Regulations 2520 (2006).

Those not briefed when assets were sold included the Attorney-General of the Federation; The Minister of Works; The Accountant-General of the Federation and the Auditor-General, who ought to be parties in the disposal of property forfeited to the Federal Government.

The report states that the Attorney-General of the Federation must set the rules of the sales; the Minister of Works must valuate the assets according to Financial Regulation 2509 (2006) and the Accountant-General of the Federation must survey and value the assets according to Financial Regulation 2510 (2006).

The committee’s interim report, obtained by Sunday Independent indicates that the appointment of an estate agent (names withheld) by the Commission under Ribadu, did not follow laid-down procedures while the agent was allowed to engage in sharp practices.

The report describes the circumstances surrounding the agent’s appointment as “unsavory’ especially as the agent was given three outstanding roles to play; “they were appointed as valuers; rent collectors and managers of the forfeited property.”

The EFCC committee also observes what it says constitutes unlawful practices by the agent, which include getting buyers of forfeited properties to issue cheques in the name of the agents “when such cheques should have been made out to the Accountant-General of the Federation as proceeds accruing to the Federal Government of Nigeria.

“The practice of keeping such proceeds in the coffers of (the agents) in violation of rules and laws manifestly directing such proceeds be lodged in the nearest Sub-Treasury within forty-eight (48) hours.”

The committee observes further that the lodgment of proceeds of sales of forfeited assets and forfeited cash in what the Commission calls the Recovery Account is a violation of the EFCC Establishment Act and Extant Financial Regulations.

This situation, it says, is further compounded by the habit of failing to promptly cash and appropriately deposit forfeitures made out in cheques and drafts and passed onto the Commission by the agents.

The report revealed the existence of N3.4 billion in stale cheques; N484, 385, 904.69 in un-cashed bank drafts; and $554, 878, 78 lying dormant at the Lagos Exhibit Room alone; indicating that the figures would be higher if added to what is available at Abuja Exhibit Room.

It said while some of the cheques have been revalidated, “what use is the re-validation when such cheques remain locked up in the vaults of the Exhibit Room?

“This hoarding of cheques; drafts and financial instruments is a violation of the law and continues to hinder the movement of the funds into the Consolidated Revenue Fund of the Federal Government. The continued custody of proceeds of these sales not only violates the Establishment Act, but provides grounds for abuse and misuse.”

The committee equally observes that the rules for evaluating forfeited property were not followed by the Commission.

It states: “Financial Regulation 2509 (d) (Revised 2006) provides for the involvement of the Ministry of Works in the valuation process, while 2510 (Revised 2006) provides for consultation with the Accountant-General of the Federation.

“What the committee observed in Tafa Balogun’s case was the unilateral appointment of (the agents) by the management of the EFCC as sole valuer; manager; rent collector and auctioneer. This negates the checks and balances necessary for the transparent disposition of the forfeited assets.”

As a result of this procedural defects, it says Balogun’s properties were sold below their prevailing market value; thus exposing glaring examples of under-valuation.

For instance, the report states that Plot 2220 Suez Crescent Ibrahim Abacha Estate, Wuse Zone 4, Abuja, a property whose land alone would sell for more than the paltry N280 million for which its five bedroom five detached duplexes was sold.

It states that this was in spite of the fact that the owner’s own evaluation of the five duplexes stood at N500 million.

It recalled other cases of under-evaluation to include Yashua and Shakir plazas, properties located in the heartland of Abuja commercial district, sold at N200 million and N300 million respectively, which it said  “do not reflect the true market values of these properties.”

The report indicates that due diligence and Know Your Customer (KYC) requirements were not observed in the sale of Balogun’s property as evidenced in the fact that of the nine persons who bought Balogun’s houses, only three are legal persons.

The three companies which could be confirmed at the Corporate Affairs Commission include: Multi Banks Savings & Loans Ltd; Otunba Otukayode and Conau Ltd.

Those whose existence could not be confirmed at the CAC include: Fadco Investment Ltd; Matbeny Holdings; Capri Martins Finance Ltd; Onesimus Global Investment Ltd; Yasua Plaza Tenants Ltd; and Shakir Tenants Nigeria Ltd.

It stated that one of the main dangers in the blunders committed by the EFCC include the risk of convicts buying back forfeited assets through proxies and the danger of the sales forfeiture process becoming an avenue for money laundering and practices inimical to the Establishment Act.

On the sale of assets belonging to Alamiyeseigha, the report stated that as in the case of Balogun, due process was not followed.

“As was the case in the disposal of Tafa Balogun’s assets, officers of the Commission did not involve these relevant parties in the valuation of the properties earmarked for disposal,” the report states.

Instead, it says the Secretary of the Commission was the one who set rules for the disposal process. These include: advertisement for the engagement of Estate Valuers; enunciation of the rule that valuers cannot also be sellers; setting-up of a dedicated account for proceeds of the sales in Access Bank, among others.

The report states that unlike in the Balogun’s case, “there were attempts to initiate activities akin to the requirements of the EFCC Establishment Act by the Secretary of the Commission.

“The Committee recognises his limitations and challenges as conditioned by an atmosphere where the over-arching paraphernalia of authority was not predisposed to due process.

“However, the law should have been obeyed and the sales process kept in abeyance until all relevant parties had been briefed as required by the Establishment Act.

“In our opinion, the process initiated by the Secretary of the Commission was generally more transparent as valuers did not become sellers as we saw in the Tafa Balogun case. We however wish to observe the absence of due diligence in the process of the sales.”

For instance, it stated that the buyer of 18 Mississippi Street, a company called Aerobell “does not legally exist.”

Further proof of lapses in due diligence, it states, was indicated by the Commission’s ignorance of “the oligopolistic grabbing demonstrated by (names withheld) who paid for 18 Mississippi Street under the legal non-entity Aerobell and also bought 20 Obagi Street Port Harcourt, under the name Brawal Shipping Ltd and also proceeded to buy 34 Amazon Street Ministers Hill Maitama.

“This sort of consummate acquisitionist should have raised an alarm for an anti-money laundering agency.

“In general, the omissions of the Secretary of the Commission in the asset forfeiture process must be judged within the context of an atmosphere where civility and due process were swamped by an essentially operational culture.”

On the crucial subject of deposit of proceeds of the sale of Alamieyeseigha’s property, the report states that the creation of a dedicated account violated the rule that states that proceeds of sale be sent to the nearest Sub-Treasury within 48 hours.

It also observes the non-involvement of the Accountant-General of the Federation as required by the Establishment Act and extant Financial Regulations; and the non-involvement of the Auditor-General of the Federation as required by the Establishment Act and extant Financial Regulation, especially Regulation 2520.

When contacted, the EFCC spokesman, Femi Babafemi

confirmed the existence of the committee, but declined to speak on the interim report.

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