Nigeria anti-graft drive now targets oil, gas telcos majors

Cash-strapped Nigeria is seeking to recover millions of dollars allegedly lost in malpractices committed by multinational companies operating in the country.

The target is the oil and gas and telecommunications sectors, which attract the bulk of foreign earnings.

The economy is in recession with inflation hitting over 17 per cent in September, and the government needs foreign currency to shore up the naira.

It is now investigating the activities of these multinationals as part of an anti-corruption drive following reports that some major companies may be engaging in crooked deals in collusion with locals.

Nigeria hopes to recover more than $17 billion from non-declaration of some 57 million barrels of crude shipped to the US between 2011 and 2014. Data gathered after the fall in oil revenue in 2014 shows under-declaration of crude oil shipments.

The companies under investigation include Agip, Total, Chevron, Shell and Exxon-Mobil. The government has already filed cases at the Federal High court in Lagos against Agip, Total, Mobil and Chevron with statements of claim accompanied by sworn affidavits of three US-based professionals. They are Prof David Olowokere, the lead analyst at Loumos Group LLC, a US technology and oil and gas auditing firm, Jerome Stanley, a counsel at Henchy & Hackenberg, a US law firm, and Micheal Kanko, founder of the Trade Data Services Company.

A forensic analysis of export records from Nigeria and the import records from respective ports of entry in the US used by the companies showed discrepancies.

Illegally repatriated

For example, the volume of crude oil declared to have been exported from Nigeria to the US was less than what was declared on the bill of lading. Other shipments were not declared to the requisite authorities, particularly the pre-shipments inspection agents. In some instances, the crude oil shipments were totally undeclared.

Nigeria wants the oil firms to pay general damages and interest on the sums at the rate of 21 per cent per annum until the entire money is liquidated.

In the telecommunications sector, South Africa giant MTN has been accused of illegally repatriating $13.92 billion from Nigeria.

Trade, Industry and Investment Minister Dr Okechukwu Enelamah and MTN have appeared before Senate’s investigation panel.

The Senate also summoned the Central Bank of Nigeria, Financial Reporting Council of Nigeria; Diamond Bank; Citibank; Standard Chartered Bank and Stanbic IBTC, among others.

According to the Senate, MTN circumvented Nigeria’s financial regulatory laws by failing to obtain a certificate of capital importation. The Senate noted that MTN worked in collaboration with the Trade and Investment Ministry, adding that the company exploited what it described as the porous Nigerian financial system by illegally moving the money out of the country.

The Senate listed the banks and money repatriated through them to include $4.87 billion through Stanbic IBTC; $5.72 billion via Standard Chartered Bank; $2.98 billion via Citi Bank and $0.35 billion via Diamond Bank.

“The repatriation was done in violation of Memorandum 22 of the Foreign Exchange (Monitoring & Miscellaneous) Act, 1995,” said Rafiu Ibrahim, chairman of the Senate Committee on Banking, Insurance and Other Financial Institutions.

Regrettable

“The Senate is concerned that since inception, MTN sought the collaboration of influential and unpatriotic Nigerians to assist them in looting our external reserves,” Senator Dino Melaye said in a motion.

He accused Dr Enelamah, who is also the owner of Celtelcom in Mauritius, of claiming to have invested in MTN consequently obtaining a certificate of capital importation then closing the investment on the same day after receiving dollar payments.

‘’It is alarming that Enelamah, the owner of Celtelcom Investment Ltd claimed to invest in MTN on February 7, 2008, got a certificate of capital importation, filled Form A on the same day then closed his investment in Nigeria after receiving dollar payment for repatriation to New York on the same day,” said Mr Melaye.

President Muhammadu Buhari is not happy about the fraud, calling it “disgusting.”

He said that oil fraud worth trillions of naira was perpetrated in 2011 and that it was regrettable that over the years oil marketers had colluded with banks to defraud Nigeria of much needed revenue from the commodity.

“One-third of the activities of the oil marketers are fraudulent, you can see how some of us Nigerians are wicked. They just take the money and stamp some papers without bringing the product; this fraudulent activity was between bankers and businessmen,’’ he said.

He said that his government would continue to encourage foreign investments but would no longer tolerate rogue companies coming to Nigeria.