Vanguard (Lagos)

28 March 2014

Nigeria: FRC Suspends Further Hearing On Sanusi's Financial Accounts

The Investigative Panel of the Financial Reporting Council, that is probing financial accounts of the Central Bank of Nigeria, CBN, between 2011 and 2012, has suspended further hearing in the matter following an order by a Federal High Court Lagos stopping the panel.

Suspended Governor of the apex bank, Mallam Lamido Sansui had filed a suit before the court challenging his suspension from office by President Goodluck Jonathan and also prayed the court for an interlocutory injunction restraining the investigative panel from summoning him to appear before it.

The Council had invited Sanusi alongside the Acting Governor of CBN, Dr. (Mrs.) Sarah Alade, immediate past Deputy Governor, Operations, Mr. Tunde Lemo, Deputy Governor, Operations, CBN, Dr. Kingsley Moghalu; Deputy Governor, Corporate Services, CBN, Alhaji Suleiman Barau and the Managing Director/Chief Executive of Bank of Industry, Mrs. Evelyn Oputu to appear before it yesterday for questioning in line with investigation into the financial accounts of the CBN for 2011 and 2012.

Sanusi and Alade did not honour the invitation of the Council. But Lemo, Barau, Moghalu and Oputu honoured the invitation and made explanations to clarify some of the issues raised by the FRC report on the 2011 and 2012 accounts.

The panel commenced sitting in the morning with focus on donations made by the apex bank, the N500 billion real sector intervention fund, professional fees paid by the CBN, and non- compliance with the International Financial Reporting Standard, IFRS.

But during the break, lawyers representing Sanusi emerged with advanced copy of application for interlocutory injunction against his invitation to the panel. This compelled the Chief Executive Officer of FRC, Mr. Jim Obazee to suspend the proceedings.

In a letter announcing the suspension of the proceedings, Obazee said, "kindly find under cover of this letter, an advanced copy of the processes filed in the aforesaid suit on 26th March 2014, which is pending before Federal High Court Lagos.

"In view of the pending application, for interlocutory injunction dated 26th March 2014, we advise that in line with the position of the law, where there is a pending action before a court of competent jurisdiction, and application for an injunction that status quo be maintained pending the interpretation of the injunction, further proceeding is hereby suspended.

"We shall continue the investigation process at the CBN office, which is an administrative procedure of the FRC. But because of the documentations that have been sent, we will wait for the court papers and study the court papers before we invite as appropriate.

"On that note, we would like to end this session until we read through and come out with definite position."

It will be recalled that Sanusi had filed a suit at the Federal High Court, Abuja, challenging his suspension from office by President Goodluck Jonathan. Consequently, his invitation to the FRC panel was considered subjudice.

Meanwhile, prior to the suspension of the proceedings of the FRC panel, Lemo, Oputu and the CBN Deputy Governors made spirited efforts to respond to the queries raised by the Council with respect to the 2011 and 2012 accounts of the apex bank. The following exchanges took between Obazee and the quartet.

On the N500 billion Intervention Fund investments in BOI, Obazee said, "We couldn't find management approval for this and we did not understand the debenture certificate. The reason we didn't understand the debenture certificate is because we did not believe there was a debenture issued.

"We also want the Bol to confirm whether they are in custody of the N500 billion because we can still see monies coming out from the CBN."

But CBN in its defence said that it is the BOI that should give account for the money.

The managing director of BOI, Ms Evelyn Oputu explained that the "fund had flown to where it should be," that it had been disbursed to the benefiting Small and Medium Scale Enterprises.

Obazee also wondered why the Assets Management Corporation of Nigeria, AMCON, should be the beneficiary of the fund having received N26 billion.

He insisted that the book of BoI should reflect the N500 billion if it actually received that amount from the CBN and also show how the money was disbursed to the beneficiaries.

On the issue of CBN donations and interventions, and the alleged N10 billion spent on the renovation of five royal palace, Barau Barau said the palace is not true. I am speaking for the board of the CBN.Lemo said the N10 billion for five palaces can never be interventions.

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