25 July 2012

Nigeria: N382 Billion Subsidy Money Stolen in 2011 - Presidential Committee

The Presidential Committee on Verification and Reconciliation of Fuel Subsidy Payments also yesterday asked the federal government to commence criminal investigation and prosecution of 21 oil marketing and trading companies (OMTs) it found culpable over alleged theft of subsidy payment funds to the tune of N382 billion in 2011.

Apart from criminal investigation and prosecution of the OMTs, the committee recommended that the said amount should be recovered.

Beside the likely fraudulent cases for criminal investigation allegedly carried out, the 21 OM & Ts affected were said to have also engaged themselves in short-term certificate issues, with a good number of OM & Ts involved in irregular payments, among others.

Chairman of the committee Mr. Aigboje Aig-Imoukhuede, who stated this after presenting the report to President Goodluck Jonathan at the presidential villa, Abuja, said "lasting and final solution to ensure that this kind of thing does not occur again is a total deregulation of the downstream sector".

The president had on July 5, 2012, constituted the Presidential Committee on Verification and Reconciliation of Fuel Subsidy Payments.

The executive summary of the committee's report presented to the president noted that 116 oil marketing and trading companies (OMTs) participated in the petroleum subsidy scheme in the period of review.

Briefing State House correspondents alongside presidential spokesman Dr. Reuben Abati and justice minister and attorney-general of the federation Mohammed Adoke (SAN), Aig-Imoukhuede said the presidential committee invited all the 116 companies for interviews, out of which 107 honoured the invitation.

He said: "Out of the N422 billion identified by the technical committee which I chaired, the presidential committee took step to identify and remove duplication, which may have been contained in the technical Committee's report which was also discovered in the course of the panel's interviews.

"Of the N422 billion, N18 billion was found to be duplication. So, the actual amount that was being verified is N403 billion. Of this amount, N21 billion was cleared and that leaves N382 billion as the sum in contention for which the committee recommended that the process of recovery should be made. The external auditors and any government functionaries who served in the subsidy regime will be further interviewed to determine their roles if any in the issues that were discussed.

"I think Mr. President has demonstrated unique wisdom in constituting very strong technocrats in the presidential committee. The reality is without the type of experience you see in some of the ladies and gentlemen that are here drawn from the CBN, attorney-general's office, SSS, banks and so on; it will be quite difficult and challenging for a layman to even understand how these issues arose and to even put up a case that will be successful in the court of law.

"Nigerians will begin to see the federal government take action that is visible having gone through the invisible hard work of putting together the cases against those who may have misbehaved in the fuel subsidy programme."

On the recovery of the looted funds, he said: "There is a number of options. The first is to determine whether you have some of the subsidy payments due still within the banking system in the possession of those who illegally collected them.

"There are other powers that the federal government has with respect to transactions that are ongoing and claims that such people may have for additional fuel subsidies - that is another source of recovery. We have also looked at one or two interesting enabling laws that allow the federal government to take certain steps we will not mention now."

For his part, AGF Mohammed Adoke explained that the report was not different from what the EFCC or the House of Representatives was already working on. The report only complemented the ones on ground, he said.


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