7 November 2010

Nigeria: NSE Paid N134 Million for 'Fictitious' Bullet-Proof Cars

The forensic audit of the Nigerian Stock Exchange (NSE) ordered by the Securities and Exchange Commission (SEC) has revealed that the former Director-General of the NSE, Mrs. Ndi Okereke-Onyiuke, purchased two bullet-proof Cadillac Escalade cars (2007 model) for N134 million in 2007.

However, according to the interim report obtained by THISDAY, the records of the NSE only showed the invoice and voucher used for the payment of the cars.

The NSE's voucher dated August 8, 2007 showed payment for the vehicles with invoice number 340 dated August 28, 2007 from Quantum Classic Limited.

"The cars were said to have been bought at the cost of N67 million each. The only records to this effect are the invoice sent in by Quantum Classic Limited and the voucher used by the Exchange to raise the money and made payment. After this, there are no other records of the cars either in form of assets or otherwise," the report said.

The report, which was commissioned by SEC last August following allegation of financial impropriety against the former management, also showed that the Exchange expended N1.5 billion on market development, publicity and public enlightenment in 2008.

"The money was said to have been approved by the Council of the NSE during its retreat in South Africa in June 2008. A breakdown of the money showed that N750 million was expended on market development, N500 million on public enlightenment and N250 million on publicity," the report said.

THISDAY had last Wednesday broken the news of how the forensic audit unearthed huge expenditure by the former management with specific reference to N1.3 billion spent on renovation of the NSE Building in Lagos.

The N1.3 billion was paid to Centric Industries Limited and Avronsyn for the renovation of the building including installation of new elevators.

Specifically, N1.112 billion was paid in 2008, N141 million in 2009 and N10 million in 2010.Meanwhile, apparently disturbed by the outcome of the forensic report, Okereke-Onyiuke is said to be making frantic efforts to stop further exposure of the full report for public consumption.

THISDAY learnt that the former NSE boss is lobbying the presidency, through the office of the First Lady, Mrs. Dame Patience Jonathan, to achieve this objective.

"There are very strong indications that Okereke-Onyiuke has ran to the First Lady for assistance. She has reportedly told Mrs. Jonathan that her travails stemmed from the fact she is a woman and that people are envious of her achievements at the NSE. Bringing in issue of gender sentiments will not help her because do not forget that the DG of SEC is a fellow woman. What is important to her is cleansing the stable and correcting the evils that have been perpetrated in the past, which contributed to the collapse of the stock market that led to losses by many investors in the nation stock market," a senior stockbroker said.

According to the broker, what the Presidency should do is to ascertain if the financial mismanagement was really carried out and allow the regulators do their job in line with the Federal Government's insistence on due process and accountability.

"Stopping the report will not only send wrong signals to the investors. We have seen what happened in the banking sector. The capital market especially the NSE, which provides the platform for people to stake their hard earned money should be sanitised for the benefit of entire economy," the broker said.

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