This Day (Lagos)

26 June 2012

Nigeria: SEC Probe - More Facts Emerge On Project 50 Scandal

As the committee investigating the controversial funding of Project 50 rounds off its report, more facts are beginning to emerge, lending credence to the allegations that the suspended Director General of the Securities and Exchanges Commission (SEC), Arunma Oteh, collected funds from corporate sponsors and paid same to third party accounts owned by external companies.

The project which was budgeted to gulp N199.19 million was believed to have been funded by numerous unsuspecting corporate sponsors most of which paid donations through accounts not belonging to SEC.

For instance, THISDAY investigations revealed that Visafone Communication Limited had on January 25 paid a total of N24.9 million to two beneficiaries (SBA Interactive Data and Efficiency Dynamics) in favour of Project 50 as directed.

Also, Assets Management Company of Nigeria (AMCON) paid a total sum of N10 million to three vendors (Dublysees Enterprises, Kanche Concept House Enterprise and Xavier Communications Limited).

These three companies are believed to belong to one of the deputy directors employed by the commission last year as special assistant to Oteh.

The aide started his career in SEC as a consultant on Oteh's assumption of office before being made a special adviser, a position deemed equivalent to a deputy director.

Further investigation revealed that the African Finance Commission (AFC) through communication with the handlers made a commitment to contribute some N2.5 million to the event in October last year, which the Project 50 handlers acknowledged but the payment details could not be ascertained.

Payment documents also indicate that N2.25 million was paid through a bureau de change to hire a private jet that brought former President Shehu Shagari to the venue of the event in Abuja.

Also, the Central Bank of Nigeria (CBN) was expected to have contributed N50 million to Project 50 but up till April, it had refused to honour its pledge on the grounds that it could not pay the sum to vendors appointed by SEC for the project.

Several correspondence between the CBN and SEC showed that the central bank repeatedly asked SEC to furnish it with its own account details to transfer the money electronically, insisting that it could not pay the amount to external vendors that had submitted invoices.

However, Oteh in a letter dated February 27 to CBN's Deputy Governor (Corporate Services), Alhaji Suleiman Barau, remained adamant, requesting his assistance to intervene and facilitate direct payment to all vendors and individuals that were yet to be paid.

A review of the N199.19 million budget for Project 50 showed that television production and advertisement placements for the event were going to cost N49 million, while the pre-event press conference and press coverage were estimated at N25.5 million.

Another N19 million was also budgeted for publicity.

These three activities are believed to have been handled by a deputy director whose company was one of the most frequently used as a receiver of the sponsorship funds.

In addition, N14 million was estimated for gift items in the budget, while other items like creative development and printing were expected to cost N14 million.

Sources close to the Ministry of Finance confirmed that the final report will be submitted within the week to the Minister of Finance and Coordinating Minister for the Economy, Dr. Ngozi Okonjo-Iweala, who is believed to have been under pressure to upturn the board's decision to send Oteh on compulsory leave.

The suspended director general, in a letter on June 11 to the Secretary to the Government of the Federation, Senator Pius Anyim, alleged that the board had conspired to terminate her appointment and abort the reforms which she is leading in both SEC and the Nigerian capital market.

She pleaded with Anyim to reverse the anomaly and illegality at SEC and "restore the unwholesomeness in the system to forestall their negative consequences for both the institution and the Nigerian capital market."

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