A former banker, Peter Omokaro, has testified against the former Managing Director of Asset Management Cooperation of Nigeria (AMCON), Ahmed Kuru, for allegedly defrauding Arik Air.
Mr Kuru and four others are alleged of a N76 billion and $31.5 million fraud.
The other defendants are former Receiver Manager of Arik Airline Ltd., Kamilu Omokide; Chief Executive Officer of the airline, Capt. Roy Ilegbodu; Union Bank Ltd and Super Bravo Ltd.
Mr Omokaro, the first prosecution witness was being led in evidence by the Economic and Financial Crimes Commission (EFCC) Counsel, Dr. Wahab Shittu.
The witness told the court that he worked with Union bank from 1980 to 2015 and was the assistant general manager at the time he exited the bank.
He told the court that the EFCC invited him to make a statement in relation to the case.
The witness said Arik air approached the bank for a purchase of aircraft.
According to him, Union Bank only guaranteed facilities secured by the airline from two foreign banks, HSBC Bank and US EXIM Bank, to facilitate the acquisition of aircraft from Airbus and Boeing.
He said: “Union bank in turn collected indemnity from Arik air and the aircrafts were delivered.
“At no point did we disburse cash for the acquisition of the aircraft and in August 2009, Central Bank of Nigeria sent a team to take over the bank and there was AMCON guideline that talked on eligible assets to buy non-performing loans and commercial papers.
“Thereafter the executive management of union bank went ahead to sell the guarantee to AMCON.
“This happened before the end of Dec. 2010 and in early 2011, when Union Bank discovered the error and tried to see how to legalize the wrong, a meeting took place in London between AMCON, Union Bank, HSBC Bank and US EXIM Bank with the exclusion of the main obligor, which was Arik air.”
Mr Omokaro added that it was from the minutes of the meeting that Union Bank wanted to step in as the obligor to take over over the responsibility of Arik air.
He added that the foreign credit agencies did not call in the guarantee neither did the bank return call in indemnity.
The witness said, “Union bank never gave loan to Arik Air.
“Union bank converted the guarantee to cash and used it to collect money from AMCON.
“The primary lender did not call in the guarantee neither did the bank call in the guarantee for Arik Air.
“Union Bank did not disburse cash for the acquisition of the aircrafts.
“In respect of this transaction, there was no default on the part of Arik because payment were up to date.”
The prosecution sought to tender five documents which were related to the transaction and the court admitted it into evidence.
The witness, while responding to the questions from Olasupo Shasore (SAN), counsel to Mr Kuru, said that the transaction took place in 2010 and that the third defendant was not the MD of AMCON at the time.
Further hearing continues on Wednesday, Mar. 19.
