Economy
TSA: Court Orders Skye Bank, UBA, 5 Others to Remit $793m to FG
By Modupe Gbadeyanka
Seven banks operating in Nigeria have been directed by a Federal High Court sitting in Lagos to remit about $793.2 million allegedly hidden by them in violation of the Federal Government’s Treasury Single Account (TSA) policy.
The affected lenders include Skye Bank, United Bank for Africa (UBA), Diamond Bank, First Bank Nigeria Limited, Fidelity Bank, Keystone Bank Limited, and Sterling Bank.
In his ruling yesterday, Justice Chuka Obiozor ordered the banks to remit the various amounts into the designated Federal Government’s Asset Recovery dollars account domiciled with the Central Bank of Nigeria (CBN).
According to court documents filed by counsel to the Attorney General of the Federation (AGF), Mr Yemi Akinseye-George, “a total of $367.4 million was illegally hidden by three government agencies in UBA, while a sum of $41 million was illegally kept in a NAPIMS fixed deposit account with Skye Bank.”
The documents indicated that “$277.9 million was hidden in Diamond Bank; $18.9 million in First Bank; $24.5 million in Fidelity Bank; $17 million in Keystone Bank; and $46.5 million in Sterling Bank.”
A lawyer from Mr Akinseye-George’s law firm, Mr Vincent Adodo, who deposed to a 15-paragraph affidavit in support of an ex parte application filed by the AGF, stated that “seven banks colluded with federal government officials to hide the funds in breach of the government’s TSA policy.”
“The funds were revenues, donations, transfers, refunds, grants, taxes, fees, dues, tariffs etc accruable to the Federal Government from different ministries, departments, parastatals and agencies,” said Mr Adodo.
Mr Adodo said the banks had failed to remit the funds to the TSA domiciled in the CBN in violation of the guidelines issued by the Accountant General of the Federation which fixed September 15, 2015 as the deadline for such funds to be moved.
The 1st to 7th respondents (banks), he said, “in collaboration with and/or collusion with unknown officials of the Federal Government, conspired to disobey the relevant constitutional provisions, thereby depriving the Government of the Federal Republic of Nigeria of funds belonging to it, which are needed urgently to fund pressing national projects under the 2017 budget.”
Among the allegedly culpable government agencies is the National Petroleum Development Company.
Moving the ex-parte application on Thursday, Mr George said “it would best serve the interest of justice for Justice Obiozor to order the banks to remit the funds to the Federal Government, to prevent the funds from being moved or dissipated.
“The withheld funds are urgently required for the implementation of the 2017 budget. The budget has a lifespan of 12 months and we are already in the middle of the year. By hiding these funds, the Federal Government is being forced to borrow money from these commercial banks at exorbitant interest rate,” Mr Akinseye-George added.
After listening to the counsel, Justice Obiozor granted the interim orders.
He directed that the order should be published in a national daily newspaper.
He, subsequently, adjourned till August 8, 2017, for anyone interested in the funds to appear before him to show cause why the interim orders should not be made permanent.
‘We are not guilty’
In a swift response to the judge’s decision, Fidelity Bank Plc denied holding any wrongdoing.
Mr Charles Aigbe, the Divisional Head, Brand and Communications at the bank, said since the commencement of the TSA policy, all TSA related accounts held by the bank were fully disclosed to the authorities.
“We do not have any TSA related account with a balance of $24.5m in Fidelity Bank which has not been remitted to the authorities,” Mr Aigbe said in a statement.
“This matter is coming to us as a surprise. We are therefore reaching out to the Office of the Attorney-General of the Federation to ascertain which account or parastatal they are referring to with a view to carrying out a detailed reconciliation,” he added.
Also, UBA’s Group Head, Marketing & Corporate Communications, Bola Atta, in a statement on Friday afternoon, said her bank “has fully remitted all NNPC/NLNG dollar deposits since August 24, 2016.”
“We hereby emphasise that none of such funds are currently in the Bank’s books. Our action was further corroborated by a clearance memo published by CBN on its website on same date (http://www.cbn.gov.ng/Out/2016/CCD/UBAPress%20Statement240816.pdf).
“We would like to thank all our customers, business partners and other stakeholders who have reached out to us on account of this judgement,” she said.
Additional information from Premium Times
By Modupe Gbadeyanka
The federal government has been asked by the Nigerian Bar Association (NBA) to suspend the implementation of the controversial tax laws.
In a reaction to the tax reform acts, the president of the group, Mr Afam Osigwe (SAN), the suspension of the laws would allow for a proper investigation into allegations of alterations in the gazetted and harmonised copies.
A member of the House of Representatives, Mr Abdussamad Dasuki, alleged that some parts of the laws passed by the parliament were different from the gazetted copy.
To address the issues raised, the NBA said it is “imperative that a comprehensive, open, and transparent investigation be conducted to clarify the circumstances surrounding the enactment of the laws and to restore public confidence in the legislative process.”
“Until these issues are fully examined and resolved, all plans for the implementation of the Tax Reform Acts should be immediately suspended,” the association declared.
It noted that the controversies “raise grave concerns about the integrity, transparency, and credibility of Nigeria’s legislative process.”
“These developments strike at the very heart of constitutional governance and call into question the procedural sanctity that must attend lawmaking in a democratic society,” it noted.
“Legal and policy uncertainty of this magnitude has far-reaching consequences. It unsettles the business environment, erodes investor confidence, and creates unpredictability for individuals, businesses, and institutions required to comply with the law. Such uncertainty is inimical to economic stability and should have no place in a system governed by the rule of law.
“Nigeria’s constitutional democracy demands that laws, especially those with profound economic and social implications, emerge from processes that are transparent, accountable, and beyond reproach. Anything short of this undermines public trust and weakens the foundation upon which lawful governance rests.
“We therefore call on all relevant authorities to act swiftly and responsibly in addressing this controversy, in the overriding interest of constitutional order, economic stability, and the preservation of the rule of law,” the organisation stated.
By Adedapo Adesanya
Demand for hot stocks, including MRS Oil Plc, buoyed the NASD Over-the-Counter (OTC) Securities Exchange by 0.52 per cent on Tuesday, December 23.
The energy company was one of the three price gainers for the session as it chalked up N19.69 to sell at N216.59 per share versus the previous day’s value of N196.90 per share.
Further, FrieslandCampina Wamco Nigeria Plc gained N2.95 to close at N56.75 per unit versus N53.80 per unit and Golden Capital Plc appreciated by 84 Kobo to N9.29 per share from Monday’s N8.45 per share.
Consequently, the market capitalisation went up by N10.95 billion to N2.125 trillion from N2.125 trillion and the NASD Unlisted Security Index (NSI) rose by 18.31 points to 3,570.37 points from 3,552.06 points.
Yesterday, the NASD bourse recorded a price loser, the Central Securities Clearing System Plc (CSCS), which gave up 17 Kobo to close at N33.70 per unit against the previous trading value of N33.87 per unit.
The volume of securities traded at the session went down by 97.6 per cent to 297,902 units from the previous day’s 12.6 million units, the value of securities decreased by 98.5 per cent to N10.5 million from N713.6 million, and the number of deals remained flat at 32 deals.
By value, Infrastructure Credit Guarantee Company (InfraCredit) Plc ended as the most actively traded stock on a year-to-date basis with 5.8 billion units exchanged for N16.4 billion. This was followed by Okitipupa Plc, which traded 178.9 million units valued at N9.5 billion, and MRS Oil Plc with 36.1 million units worth N4.9 billion.
In terms of volume, also on a year-to-date basis, InfraCredit Plc led the chart with a turnover of 5.8 billion units traded for N16.4 billion. Industrial and General Insurance (IGI) Plc ranked second with 1.2 billion units sold for N420.7 million, while Impresit Bakolori Plc followed with the sale of 536.9 million units valued at N524.9 million.
By Dipo Olowookere
It was another bullish trading session for the Nigerian Exchange (NGX) Limited as it closed higher by 0.59 per cent on Tuesday.
The market further rallied due to continued interest in large and mid-cap stocks on the exchange by investors rebalancing their portfolios for the year-end.
Yesterday, Aluminium Extrusion sustained its upward trajectory after it further appreciated by 9.96 per cent to N14.90, as Austin Laz gained 9.81 per cent to close at N2.91, Custodian Investment improved by 9.69 per cent to N38.50, and First Holdco soared by 9.35 per cent to N50.30.
Conversely, Royal Exchange declined by 7.22 per cent to N1.80, Champion Breweries shrank by 6.57 per cent to N15.65, NASCON lost 5.36 per cent to trade at N105.05, Sovereign Trust Insurance depreciated by 5.28 per cent to N3.77, and Japaul went down by 4.51 per cent to N2.33.
At the close of business, 29 shares ended on the gainers’ table and 27 shares finished on the losers’ log, representing a positive market breadth index and bullish investor sentiment.
This raised the All-Share Index (ASI) by 895.06 points to 153,354.13 points from 152,459.07 points and lifted the market capitalisation by N579 billion to N97.772 trillion from the previous day’s N97.193 trillion.
VFD Group finished the day as the busiest stock after it recorded a turnover of 192.0 million units worth N2.1 billion, GTCO exchanged 63.5 million units valued at N5.6 billion, Access Holdings traded 49.8 million units for N1.0 billion, First Holdco sold 45.8 million units valued at N2.3 billion, and Secure Electronic Technology transacted 38.3 million units worth N28.4 million.
In all, market participants bought and sold 677.4 million units valued at N20.8 billion in 27,589 deals compared with the 451.5 million units worth N13.0 billion traded in 33,327 deals on Monday, showing an improvement in the trading volume and value by 50.03 per cent and 60.00 per cent apiece, and a shortfall in the number of deals by 17.22 per cent.
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