N1.8trn recovered loot, N450bn assets: 36 states drag FG to Supreme Court, allege diversion - SALIENT TIMES ONLINE

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Tuesday, 17 August 2021

N1.8trn recovered loot, N450bn assets: 36 states drag FG to Supreme Court, allege diversion

By Our Correspondent



 The Nigeria Governors’ Forum (NGF), a platform for all the 36 state governors, has dragged the federal government to the Supreme Court over alleged illegal diversion of over N1.8 trillion recovered loot.



The governors also accused the federal government of diverting another N450 billion worth of non-cash assets recovered proceeds of crime since 2015.


They claimed that rather than paying the cash into the Federation Account, the federal government illegally diverted it into the Consolidated Revenue Accounts (CRA) and other accounts not recognised by the Nigerian Constitution.


The governors’ position was made known in an affidavit deposed to by NGF Director-General Asishana Okauru, on behalf of the plaintiffs.



A “common pool of all revenues of the federation of Nigeria”, the Federation Account houses the funds that are meant to be shared among the federating units based on agreed revenue sharing formula, the plaintiffs pointed out in the affidavit filed in support of the suit.


On the other hand, the CRA, according to the plaintiffs, is the account into which the federal government’s share from the Federation Account, other federal earnings, and funds belonging to specific state governments are paid.


Other federal earnings payable to the CRAs include receipts from federal government licenses and land revenue, administrative fees, earnings and sales, rent of government property, interests from federal government investments, repayments from state governments, Personal Income Tax of Armed Forces, and others.


They contended that the funds in the CRAs strictly belonging to the federal government and specific states are not distributable among the federating units.


“When funds are allocated from the Federation Account to the Federal or State Governments as the case may be, they are transferred to the respective Consolidated Revenue Accounts from which appropriation for government expenditure is made by an Appropriation Act or a Supplementary Appropriation Act, whichever the case,” the supporting affidavit added.


Citing  sections 162 (1), 162 (10) and 80 of the Nigerian constitution and section 2 of the Finance (Control and Management) Act, 1958, the plaintiffs argued that recovered funds qualify as revenue payable to the Federation Account instead of the Consolidated Revenue Account of the federal government.


Therefore, it is “unconstitutional to remit or divert revenue payable into the Federation Account to the Consolidated Revenue Account of the Federal Government or any other account whatsoever, or to apply the said revenue to any other purpose,” they further submitted.


They are therefore asking for the remittance of N1.8 trillion (cash) and N450billion (non-cash) in recovered loot since 2015 into the federation account.


They are also asking for a detailed account of the recovered assets not remitted into the Federation Account by the Muhammadu Buhari administration, as well as all the relevant officials and agencies of government.


They also asked the apex court to compel the federal government through the Revenue Mobilisation and Fiscal Commission (RMFAC) to design the modalities for distributing recovered assets among the federating units.


The state governments, whose legal team is led by widely known Senior Advocate of Nigeria, Femi Falana, filed the suit with far-reaching implications on the handling of forfeited assets in Nigeria at the Supreme Court on June 16, 2021.


The court document cited Monday, has the Attorney-General of the Federation, Abubakar Malami, representing the federal government, as the sole defendant in the suit marked, SCN/CV/393/2021.


How Buhari violates Nigerian constitution’


A legal action spearheaded by the NGF led by Governor Kayode Fayemi of Ekiti state and supported by all the 36 state governors across party lines, the suit accuses President Buhari of various constitutional breaches in his handling of the forfeited assets.


The plaintiffs said, while claiming to be promoting his anti-corruption agenda, Buhari “has consistently contravened the provisions of the Constitution, violated the rights of the states and abused the Federal Government’s position as trustee of the Federation Account”.


They accused him of committing these violations “by diverting funds meant for the Federation Account into other accounts owned and operated by the federal government, including the Consolidated Revenue Accounts, and applied the said revenues for the sole benefit of the Federal Government”.


They also attributed more constitutional violations to the Asset Tracing, Recovery and Management Regulation, 2019, made by the Buhari administration through the Attorney-General of the Federation, Abubakar Malami.


Contrary to the constitutional provisions, the plaintiff argued, the Regulation “establishes the Federal Government of Nigeria Asset Recovery Account domiciled with the Central Bank of Nigeria and prescribes that all proceeds from the Final Forfeited Assets should be paid into the said account”.


They added that the Regulation also establishes the Interim Forfeiture Recovery Account into which all funds belonging to other tiers, or forfeited to other tiers shall be paid into.


“By establishing the Asset Recovery Account and interim Forfeiture Recovery Account into which revenue from recovered assets is to be paid, the Asset Recovery Regulation contradicts the provisions of the Constitution. The Honorable Attorney General of the Federation has also acted beyond his constitutional powers,” they said further.


Diverted recovered loot


The plaintiffs noted that since 2015, “numerous recoveries of illegally acquired assets have been secured through anti-corruption and law enforcement agencies”, including the Economic and Financial Crimes Commission (EFCC), Independent Corrupt Practices and Other Related Offences Commission (ICPC), the Nigerian Police Force and the Office of the Attorney General of the Federation.


Between 2015 till date, they said, the federal government has secured both international and municipal forfeiture, recovery and repatriation of stolen assets, including a total sum of N1, 836, 906, 543, 658.73.


Other such recovered assets, according to the plaintiffs include, about 167 properties, 450 cars, 300 trucks and cargoes, and 20, 000,000 barrels of crude oil worth over N450 billion, according to the state governments.


They, however, said the President, through his ministers and anti-corruption and law enforcement agencies “have failed to remit the receipts, proceeds or income derived from the recovered assets to the Federation Account as constitutionally required”.


“The federal government has consistently diverted these funds to other purposes, including payment into its Consolidated Revenue Account for its sole benefit,” Mr. Otauru said in the supporting affidavit.


“Where revenues payable into the Federation Account have been illegally diverted into the Consolidated Revenue Fund, or applied to any other contrary purpose by the Federal Government, the illegally diverted revenue must be repaid, and the repayment is charged on the Consolidated Revenue Account of the Federal Government or its share of allocation from the Federation Account,” the plaintiffs argued further.


Prayers


The plaintiffs asked the court to grant them 13 specific prayers.


These include, a declaration that “by the provisions of Section 162(1) and Section 162(10) of the Constitution of the Federal Republic of Nigeria 1999 (As Amended), all income, returns, proceeds or receipts howsoever described derived from confiscated, forfeited and/or recovered assets constitute revenue of the Federal Republic of Nigeria which must be remitted to Federation Account for the collective benefit of the Federal, State and Local Governments”.


The plaintiffs also urged the court to declare that the failure and/or refusal of the President, the Minister of Finance, the AGF office and the Accountant General of the Federation, and all other relevant authorities and/or agencies of the federation to remit the receipts, income, returns or proceeds derived from all assets recovered, seized, confiscated and forfeited into the Federation Account to be distributed in accordance with the provisions of Section 162 of the Constitution of the Federal Republic of Nigeria 1999 (As Amended)among the Federal, State and Local Governments is unconstitutional.


They sought, among others, an order directing the President, the Minister of Finance, the AGF office, the Accountant General of the Federation, and all other relevant authorities and/or agencies of the Federation to give an account of the receipts, income, returns or proceeds derived from all assets recovered, seized, confiscated and/or forfeited to the The Federal Republic of Nigeria.


The assets the plaintiffs asked the apex court to compel the officials to account for include N1, 836, 906, 543, 658.73 (cash) and N450, 000, 000, 000.00 (non-cash) ,which were not remitted to the Federation Account in line with Section 162 of the Nigerian constitution.


The plaintiffs also sought another order directing the President, the Minister of Finance, the AGF, the Accountant General of the Federation and all other relevant officials and agencies “to remit” the N1, 836, 906, 543, 658.73 (cash) and N450, 000, 000, 000.00 (non-cash) into the Federation Account immediately.


They also asked the apex court to direct Mr Buhari and the officials and aforementioned officials and agencies, including the Revenue Mobilisation and Fiscal Commission (RMFAC) “to determine forthwith, the modalities for distributing the receipts from seized, forfeited and recovered assets among the Federal, State and Local Government from the Federation Account”.


Next stage


The Supreme Court is the court of original jurisdiction on disputes between the federal government and the federating units.


And being a constitutional matter, it will be heard by a full panel of seven Justices of the Supreme Court.


But as of Tuesday, the federal government, through the office of the AGF has yet to file its defence. (Premium Times)


Malami reacts


But in a reaction, Attorney General of the Federation and Minister of Justice Abubakar Malami, SAN, said the recovered stolen funds were governed by “conflict of laws” principles and not local legislation, explaining that its workability entails multiple sovereignties.


The AGF spoke Tuesday in a statement by his media aide, Dr. Umar Jibrilu Gwandu in Abuja.


He said “the international recoveries are more or less governed by international conventions, negotiations and agreement of parties. It is never a straightjacket application of local legislation.” 


“So, questions of recovery of stolen funds from indicted public officers are appropriately dealt with by other relevant laws,” the statement clarified.


“It is, therefore, misleading to give the impression that such recoveries and usage of stolen funds and stashed abroad are provided for by the Revenue Mobilization, Allocation and Fiscal Commission Act.


“One cannot situate rights and entitlements on looted funds and recovered assets with myopic and narrow understating of concepts of the application of local legislations.


“For the avoidance of doubt and the purpose of setting the record straight, the application of the looted funds can only be factored within the context of mutual understanding and negotiations of international and multifaceted jurisdictional and territorial legislative issues.


“The recovery of stolen assets and the subsequent uses to which these funds may be employed are subject to international agreements between Nigeria and the affected countries, thereby bringing conflict of laws into contemplation.


“Importantly also, these repatriated funds are based on cooperation and mutual assistance agreements, especially the United Nation Convention against Corruption and Implementation of the Global Forum on Asset Recovery (GFAR) Principles on the Repatriation of Stolen Assets,” Malami said.


In domesticating the issue, the AGF said “the African Union and the ECOWAS Protocols on recovery of illicit funds are equally relevant when it comes to the role of the Nigeria in relation to its other partners.


As a member of the comity of nations and a respectable international partner, the minister added that Nigeria must always strive to fulfil its international commitments in the repatriation and use of stolen funds and assets.


He said: “As a way of example, the Federal Government of Nigeria has entered into numerous agreements such as the one with the United States and the Island of Jersey in 2020, and including with other countries around the world. 


“Where the agreements assume an international character, the specifics of the agreement often dictate the trajectory of recovery, sharing, transfer and implementation. Some element misunderstood the issue of international recoveries and locally generated funds in relation to monies belonging to the Federal Government that are locally generated. It is not to be confused with stolen funds and assets domiciled in foreign jurisdictions whose recovery and subsequent repatriation are based on international legal arrangements between the Federal Republic of Nigeria and the foreign custodians of these funds.


“It needs to be further noted that even recoveries of local assets are in most cases regulated by the applicable legislations and judicial pronouncements associated with these legislations and not Revenue Mobilization and Fiscal Commission Act exclusively. One can cite for the purpose of clarity recoveries done by the NDLEA, EFCC, ICPC among others.”


CSOs laud move


Speaking to SalientTimes on the legal brawl, Executive Director Peering Advocacy and Advancement Centre in Africa (PAACA)  Ezenwa Nwangwu  said it a very important litigation which would advance the principle of federalism and expands constitutional democracy.


Nwangwu also expressed surprise that “governors want democracy at the top while they behave like czars and emperors in their states.”


“I hope this also triggers and compels citizen and civic groups to institute legal actions that help to promote, financial transparency and openness in the states.


Also, former Secretary General, Organisation of African Trade Union Unity (OATUU), Mr Owei Lakemfa, said Nigeria is a federation, which  in practice is run as a unitary system.


He said “the states are beginning to wake up from their slumber and the country will benefit and there might be less agitations for restructuring.


Lakemfa said “this is why this suit by the 36 states is salutary; the same way the Rivers State Government case against the Federal Government and the FIRS on VAT and other basic taxes is commendable.”


The labour leader said he looked forward to the day state governments “will assert their right  to determine who will become the Inspector General of Police and other such appointments.”


Also, the Governance Manager, ActionAid Nigeria, Celestine Odo, said the governors were right in suing the federal government.


He said: “They represent Nigerians and Nigerians deserve to know because they have been clamouring for the assets recovery, transparency and monitoring value amongst others.  Nigerians have been rooting for accountability and transparency as regards assets recovery.


Odo said the federal government was yet to tell Nigerians the total amount given to the country on COVID-19 intervention funds and Nigerians deserved to know.


He said “what the state governments’ demands are in line with the Fiscal Responsibility Right and the Civil Society Organisations (CSOs) are in support.”