EFCC chairman accuses FG officials of complicity in alleged N1.4bn Oil Subsidy Fraud

The ongoing trial of Abubakar Ali Peters and his company, Nadabo Energy Limited, for an alleged N1.4billion fraud, before Justice Chris Balogun of the Lagos State High Court sitting in Ikeja continued on Tuesday, November 16 2021, with the Court admitting in evidence all the documents tendered by the prosecution against the defendants.

Mr Abubakar and his company are being prosecuted by the Economic and Financial Crimes Commission for allegedly using forged documents to obtain N1,464,961,978.24 from the Federal Government as oil subsidy, after allegedly inflating the quantity of Premium Motor Spirit, PMS purportedly imported and supplied by the company.

They pleaded “not guilty” to the charges preferred against them.

The prosecution counsel, Seidu Atteh, had at the last sitting on March 10, 2021, sought to tender correspondences between the EFCC and Petrocam Trading PYT Limited as well as the Corporate Affairs Commission (CAC) in relation to the alleged fraud.

He had sought to tender them through the Executive Chairman of the EFCC, Abdulrasheed Bawa, who is the fifth prosecution witness and the lead investigator in the case.
The defence team, led by Osagie Isiramen, had, however, raised objections to the admissibility of the documents, citing several authorities, including Section 83 of the Evidence Act.

He had argued that the documents sought to be tendered were being brought to the knowledge of the defence, during the pendency of the trial, several years after the case had already commenced.

But, Justice Balogun in his ruling dismissed the objections raised by the defence as lacking in merit.

With regard to the correspondence between the EFCC and Petrocam, Justice Balogun held that “The documents sought to be tendered were already in existence before this case was filed.

“Petrocam only gave documents of what already took place to the EFCC; and so, there is no surprise for the defence.”

On the objections raised to the admissibility of the correspondence between the EFCC and the CAC, the Judge reminded the defence of its ruling on February 2, 2021 on a similar argument still being canvassed and said: “The Court is still bound by its ruling in relation to certifying officers and payment for certification and shall abide by its earlier ruling. And so, in the circumstance, the objection is overruled.”

Thereafter, the letters of investigation activities written by the EFCC to Petrocam and the CAC as well as the responses from the two agencies were admitted in evidence against the defendants as exhibits O4, O5 and O51.

Testifying further, Mr Bawa told the Court that the correspondences were thoroughly studied in the course of investigation.

He also told the court that the correspondences further unearthed several fraudulent activities embarked upon to defraud the Federal Government in fuel subsidy funds.

He said: “We studied the responses from Petrocam and found out that, contrary to the claim of the defendant that Ashland Energy SA was the supplier, it was Petrocam Trading PYT Limited that supplied about 4,500MT equivalent to about 6.5million litres of PMS as against the claim of about 14,000MT of PMS equivalent to about 19.8million litres purportedly supplied by the defendant.

“The response also confirmed to us that the Letter of Credit (LC) No. SPG/DLC/11/0013 is actually in favour of Petrocam and not Ashland Energy as claimed by the defendant’s purported documents.

“We also found out that the daughter vessel, MT St Vanessa, received the product PMS on 2nd December 2011 from a mother vessel, MT Eviridiki, which was contrary to the claim by the defendant that, on the 2nd of December 201, MT Vanessa received the products from MT American Express.”

In furtherance of the investigation, and a fallout of the correspondence with Petrocam, Mr Bawa said letters of investigation activities were sent to Enterprise Bank Limited, requesting to be furnished with the copies of instruments used for the utilisation of certain funds in the account of the first defendant.

He further said: “The bank received our original letter, acknowledged the copy and accordingly responded to our letter in writing, attaching copies of the requested documents.

“We equally wrote another investigation letter to Skye Bank Plc for copies of the account opening documents and the statement of account of the first defendant.

“The bank duly acknowledged receipt and also responded in writing, attaching all the requested documents as well as Certificate of Identification.

“We studied the statement of account and found out that the said account is the account that received the subsidy payment of more than N1.4billion on 4th April 2012 in favour of the transaction in the matter before this honourable court.”

According to him, further analysis indicated that “the entire subsidy payment received was utilised by the defendant, including a huge transfer of N850million to Enterprise Bank, which we found out to be for the liquidation of the LC raised in favour of Petrocam for the actual transaction that took place.”

He further testified that “then Spring Bank was approached by the defendant to finance the said importation.

“The bank agreed and raised the Letter of Credit valued at $4.8million In favour of Petrocam.”

According to him, investigation showed that the defendant reached out to one Mr. Jide Offor Akpan of International Maritime and Shipping Ltd, who helped to charter MT St Vanessa, adding that “It was the same vessel that received 6.5million litres on 2nd December 2011 from Petrocam based on the LC that was raised.

“We found out that Q & Q Control Services Limited was engaged by the defendant to witness the ship-to-ship transfer of 6.5million litres or about 4,500MT of PMS from MT Eviridiki into MT St Vanessa.

“We also found out that St Vanessa only picked products from MT Eviridiki on 2nd December 2011 of 6.5million litres and discharged the same on behalf of the defendant at Masters Energy depot in Port Harcourt.”

According to him, the findings were contrary to the claims in the documents submitted by the defendant to the Petroleum Products Pricing and Regulatory Agency (PPPRA).

“We found out from our investigation that the claims were false to our own knowledge. We wrote an investigation activity letter to PPPRA giving them our findings and asking them to recompile the subsidy that ought to have been paid by the defendant. They recompiled the subsidy amount and we studied their response which confirmed to us further that the defendants inflated the imported PMS with about 12 million litres with which he collected he collected about 978 million naira as subsidy.

He was paid 1.4 billion naira for claiming to have imported 19 million litres, instead of him to be paid 485 million naira for importing 6.5 million litres.”

Justice Balogun asked the star witness how it was possible for the government not to have seen the alleged fraud, to which he replied that there were 38 items on the checklist for such payments which the FG relies on, but that such is done without verification.
He also added, “there is also conspiracy of officials in the fraud, as they also collect bribes.”

Mr Bawa also testified on how he invited the first defendant for questioning on January 28 and February 8, 2012.

“I cautioned him in English Language on the EFCC statement form, he confirmed to me he understood the words of caution and then signed the words of caution in Abuja and he volunteered his statements.”

Thereafter, Mr Atteh sought to tender the correspondences between the EFCC and Enterprise Bank as well as Skye Bank.

However, though Mr Isiramen did not object to the admissibility of the EFCC letters, he objected to the admissibility of the responses from the two banks.

Following the arguments by the defence and prosecution, citing several authorities, Justice Balogun adjourned till December 7, 2021 for “ruling and continuation of trial”.

The EFCC is also prosecuting Mr Ali Peters and his company, on another 21-count charge bordering on forgery and subsidy fraud to the tune of N761.6 million before Justice Sedotan Ogunsanya of the Lagos State High Court, sitting in Ikeja.