Ibekimi Oriamaja Reports
The Senate Public Accounts Committee (SPAC) yesterday gave the Nigerian Maritime and Safety Agency (NIMASA) 48 hours to present documents authorizing a $5 million payment to a law firm for a service that was not rendered.
The committee, chaired by Senator Matthew Urhoghide (Edo South), had asked NIMASA management to explain why $5 million was paid for a service that was never provided.
Olamide Olusanya, NIMASA’s representative, told the Committee yesterday that the matter was currently being litigated in court.
The Committee, however, rejected the explanation and requested that the agency make a presentation based on the information at their disposal regarding the payment of legal fees to the law firm.
Olusanya explained that the agency was directed by the then-Federation Attorney-General to pay the $5 million legal fees.
Urhoghide, on the other hand, asked the NIMASA representative to present any letter authorizing the agency to pay $5 million in legal fees.
In response to whether the Presidency directed the agency to pay the legal fees, the NIMASA official stated that there is no such letter and that they only have a letter authorizing the payment from the Senior Special Assistant to the President on Administration.
As a result, the Committee directed the agency to submit payment-related documents by Thursday of this week in order for the Committee to make a final decision on the matter.
“We need the payment details,” Urhoghide said. “You go back to your archives and bring them out.”
Senator Abdullahi Danbaba, a member of the Committee, insisted that the payment had no basis and that the money should be recovered from the law firm.
“Before you pay the money, let us know about the transaction between you and AGF,” Urhoghide added.
The Committee had previously extended three invitations to NIMASA regarding the payment of a $5 million professional fee and the disclosure of details regarding the Federal Government’s $9.3 billion loss, but the agency allegedly did not honor the summons.
The office of the Federation’s Auditor-General had questioned the agency for refusing to present the breakdown of the Federal government’s $9.3 billion loss for thorough scrutiny.
According to AuGF’s report, the funds were transferred from a Zenith Bank (UK) dollar account.
“Audit observed that the agency engaged the service of a legal firm through a letter with reference number NIMASA/DG/KP/2014/001, dated 24th January 2014, for the intelligence-based tracking of global movement of Nigerian Hydro-Carbon and recovery of loss by the Federal Government of Nigeria in the sum of USD9.3billion between 2013 and 2014, with a start-up cost of USD5million and 5% of all sums recovered,” according to the query.
“Payment instruction NIMASA/2007/DFS/WJ/5.500/VOL.11/341 dated April 2014 revealed that the firm was paid $4,523,809.52 net as professional fees from Zenith Bank (UK) Dollar account.”
“At the time, the Naira equivalent of this amount was N741,904,761.28 at an exchange rate of N164 to a dollar.”
“Despite the large sum of money already paid to this effect, no evidence of recovery of either part or the entire sum of 9.3 billion US dollars was presented at the time of the Periodic Check in February 2018.”
“It is instructive to note that details of the transaction resulting in a loss of USD9.3 billion to the Federal Government were not presented for audit.”
“Normally, the firm should have deducted its fees from the FGN’s recoveries rather than receiving fees in advance in lieu of the recoveries.”
“The audit is concerned that payments were made for services that were not performed, and this could be a deliberate attempt to divert government funds for personal use.”
“The Director-General is required to justify the payment for service not rendered, failing which the sum of N741,904,761.28 should be recovered from the legal firm and paid into the CRF (Consolidated Revenue Fund), with evidence of payment forwarded to the National Assembly’s Public Account Committees and the Federation’s Office of Auditor-General for verification.” The sanctions outlined in FR (Financial Regulation) 3104 should be followed.
“He is also required to provide details of the transaction(s) that resulted in the loss of 9.3 billion US dollars for thorough examination.”
