Although the tenure of Mallam Sanusi Lamido Sanusi, as Governor of Central Bank of Nigeria (CBN), had come and gone, the dust generated by his administration will remain for a long time to come. The administration which had been described as the most controversial in the history of the apex bank, became much more controversial in its twilight when Sanusi raised an alarm that whopping $49.8 billion was unremitted the Nigeria National Petroleum Corporation (NNPC) to federation account domiciled with CBN. Sanusi's allegation was contained in a letter he addressed to President Goodluck Jonathan in September last year. However, the allegation did not become an issue until its content was leaked to former President Olusegun Obasanjo and the press in November last year. Specifically, Sanusi alleged that the NNPC had failed to remit $49.8 billion to the federation account over a 19-month period. According to him, between January 2012 and July 2013, NNPC lifted $65 billion worth of crude oil and only remitted $15 billion into the federation account. This implied that about $50 billion was missing from the federation account.
The magnitude of the allegation and the wild reactions which accompanied it from Nigerians as well as the international community, compelled the Senate to mandate its committee on finance on December 11, 2013, to investigate the veracity of the allegation and report its findings to the Senate. The decision followed a matter of urgent national importance raised by Senator Olubunmi Adetumbi (Ekiti North) during which he drew Senate's attention to a newspaper report on the alleged missing funds. The parliament also asked the committee to investigate the allegation of N700 million subsidy payment by NNPC on kerosene daily. The latter mandate followed a motion by Senator Babajide Omoworare (Osun East).
Consequently, the committee commenced its investigative hearing on December 18, 2013. Expectedly, the hearing room in the new Senate building was filled to the capacity with many Nigerians who wanted to hear from the horse's mouth. Already, tension was high as people expected to see further explosions from vintage Sanusi whose allegation had been widely believed by the greater percentage of Nigeria's population ahead of investigation. Eventually, as the audience took their seats, the floor was yielded to Sanusi, who is now the Emir of Kano, to substantiate his allegation. At this level, there was dead silence in view of the explosive revelations the audience expected to hear from the eloquent former CBN governor. But it was a shocked audience that listened to Sanusi in a quiet tone devoid of his usual confidence, saying it was actually $12 billion that was missing and no longer $49.8 billion as he earlier claimed.
While the audience was yet shocked by this volte face, Co-ordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, interrupted him, saying Sanusi's claim of missing $12 billion was also false, disclosing that it was actually $10.8 billion that was yet to be reconciled inter agencies. He therefore, urged the committee to suspend the hearing to enable him and other stakeholders continue with ongoing reconciliation efforts at the time.
Upon the return to the public hearing on February 4, 2014, the committee only expected an update on the ongoing reconciliation over the outstanding $10.8 billion, but was again shocked when Sanusi reeled out another allegation, saying it was no longer $10.8 billion that was missing but this time, $20 billion. According to him, NNPC had shipped $67 billion worth of crude oil and remitted only $47 billion into the federation account between January 2012 and July 2013, leaving the balance of $20 billion unaccounted for. Further, he claimed that only $14 billion directly came into the federation account out of the total $67 billion in addition to the $15 billion he claimed that NNPC paid to Federal Inland Revenue Service (FIRS). With Sanusi simultaneously approbating and reprobating, the original job mandate of the Makarfi committee shifted from the probe of $49.8 billion to $20 billion. It is worthy of note that from the take off of the public hearing, it had been established that between January 2012 and July 2013, NNPC had remitted $47 billion into the federation account. Breakdown of the remittances as later submitted by CBN before the committee was $14 billion as payment on equity crude; $15 billion as payment to FIRS by international oil companies (IOCs) as the value of crude lifted by NNPC on behalf of FIRS; $16 billion as domestic crude and $2 billion royalty payments to Department of Petroleum Resources by IOCs. While CBN claimed that it was $15 billion that was remitted to FIRS by NNPC, FIRS established that NNPC actually paid $16 billion to it. The committee confirmed the latter. The fresh allegation by Sanusi compelled the committee to assemble all stakeholders including the Attorney General of the Federation, Mohammed Adoke, Auditor General of the Federation, Sam Ukura, NNPC's subsidiary, Nigeria Petroleum Development Company (NPDC), besides ministers of finance and petroleum, CBN, NNPC and third party agents. However, in its 73-page report, the committee submitted that it could not reconcile how the suspended Governor of CBN arrived at the alleged missing $49.8 billion and therefore dismissed the allegation as false and a figment of Sanusi's imagination. It also accused Sanusi of reversing himself several times before the committee. "The committee could not see how the figure of $49.8 billion was arrived at by the CBN Governor for instance," adding: "there was never any unremitted $49.8 billion."
Further, it said: "The CBN governor at the first hearing had put forward the figure of US$12 billion as monies to be reconciled and changed his position to $US $20 billion at subsequent hearing. At the conclusion of his written submission, he posited that it could be US $20 billion, US$10.8 billion or anything in between," it said. On the alleged unremitted $20 billion, the committee however, said it found that the sum of$218. 0 million considered as federation account share of the third party financing was still in dispute and therefore should be remitted by NNPC. It also noted that another sum of $447.8 million which it described as the federation account share from the $6.815 billion liftings by NNPC on behalf of NPDC remained in dispute. Also in dispute according to the report is $262 million which the committee described as expenses incurred by the NNPC in respect of holding strategic reserve pipeline maintenance and management cost/capital expenditure. The committee therefore asked the corporation to refund this sum of money into the federation account, saying NNPC could not satisfactorily defend it even though it acknowledged that the sum is still very much in dispute by the corporation. Eventually, when the committee opened the 73-page report for debate on Thursday, it approved all these submissions. During the debate, Senate had lots of knocks for Sanusi whom it described as cooking up allegations without paying cognizance to the magnitude of his office and the effect it would have on the society. Specifically, Senators Ayogu Eze (Enugu North) and Heineken Lokpobiri (Bayelsa West), said it was regrettable that Sanusi while occupying a position of that magnitude opted to mislead the public with falsehood.
Eze also accused various financial institutions in the country of working at cross purposes, lamenting that the former CBN boss exalted himself and the institution above the government which appointed him as he blamed the trend on breakdown of communication among the relevant agencies. Senate's findings appeared to have justified the initial reaction of NNPC to the allegation. The corporation argued that the allegation was politically motivated. NNPC also accused Sanusi of lacking technical knowledge of the workings in the oil industry. According to the group, the allegation was not based on facts but rather an orchestration meant to score cheap political points and embarrass the government. It was however later revealed that Sanusi came up the allegation to divert attention from his investigation by the Financial Reporting Council of Nigeria, FRCN which was closing in on him following financial recklessness observed in the 2012 CBN audited accounts. On the strength of which he was later suspended on February 20, 2014 by President Jonathan. Sanusi did not return to the office until his tenure expired on June 2. In his remark, Senate President David Mark, who presided over the debate, expressed happiness that the report had laid to rest the "rumours" that heated the polity, saying the report before the Senate was a fact and no longer a rumour. He however, blamed the legislature for failing in its oversight functions as a result of its inability to discover the lopsidedness pervading the rank and file of the financial sector before the alarm was raised. He said: "Whether the alarm is genuine or not is another matter. The executive might have good reasons but the legislature obviously did not have reasons not to find out. Let me appeal to the various committees to endeavour to do their work. Facts are different from rumours and what we have before us are the facts based on the interview conducted by the committee on public hearing and on all the documents that they could put together.
One thing is very obvious, due process has not been followed and they have stated it so very clearly." Further, Mark said: "Whether it is funds yet to be remitted, funds yet to be reconciled or funds yet to be unaccounted or missing, I think we should not play politics with it. Because if we describe it as missing or unaccounted for, the issue is that there is a reconciliation going on. When you out rightly said it was missing, then you had concluded. The point I am trying to make is that we should not conclude when the process of reconciliation is still ongoing," he advised. The Senate however, reprimanded the NNPC for spending unappropriated fund as kerosene subsidy. The senators also resolved that between 2012 and 2013, the sum of $4.430 billion that was not unappropriated by the National Assembly was spent on kerosene subsidy adding, however, that the amount might exceed this figure because the certification by the Petroleum Products Pricing Regulatory Agency (PPPRA) for the period was on an interim basis.
The Senate also adopted a recommendation that in view of the expenditure incurred by the corporation on subsidy which was not captured by the 2014 Appropriation Act, Jonathan should prepare and present to the National Assembly a supplementary budget "to cover the expenditure in the sum of N90.6 billion for PMS (premium motor spirit) subsidy 2012 and the sum of N685.910 billion for kerosene subsidy expended without appropriation by the National Assembly." The parliament also adopted the recommendation of the committee "that the Senate accepts the subsidy deducted by NNPC in the sum of $1.2 billion (N180) billion for fourth quarter of 2011 since it was certified by PPPRA and appropriated by the National Assembly. This is without prejudice to the outcome of forensic audit conducted by the office of the Auditor-General of the Federation." It also resolved that "the Senate accepts the subsidy deducted by NNPC from January 2012 to July 2013 of $5.254 billion (N813, 803 billion) since it was certified by PPPRA and appropriated by the National Assembly."
NNPC to a large extent now stands vindicated and the man who made the allegation and was unable to substantiate it with any shred of fact was roundly condemned by the senators. But in a politically charged atmosphere like ours, the now false allegation easily played into the politics of the moment and unnecessarily damaged a corporation's public reputation.