By Abdulwahab Abdulah
LAGOS – Amid protests over increase in fuel price by the Federal Government, the Economic and Financial Crimes Commission, EFCC, has been asked to investigate alleged fraud in the importation of Premium Motor Spirit, PMS, by the Petroleum Products Pricing Regulatory Agency, PPPRA, for fuel subsidy from January to December 2011.
In a petition by former President of the West African Bar Association, WABA, Mr. Femi Falana, dated January 5, 2012 addressed to the acting chairman of the EFCC, Mr. Ibrahim Larmorde, the lawyer noted that in spite of the fact that N240 billion was voted for fuel subsidy in 2011, over N1.4 trillion was eventually spent even without the approval of the National Assembly.
According to Falana, it was discovered that the Nigerian National Petroleum Corporation, NNPC, which allegedly collected 50 per cent of the fund and other importers of petroleum products allegedly increased the subsidy fund from N240 billion to N1.4 trillion without a supplementary appropriation bill passed by the National Assembly.
Falana said it was discovered that “of the said sum of N1.4 trillion only 62.9 per cent was paid as subsidy on PMS in 2011,whereas N421 billion and N673 billion were paid as fuel subsidy for 2009 and 2010 respectively, the NNPC was paid over N400 billion as arrears of subsidy claims for 2009 and 2010.”
He further said that “demurrage payments made by NNPC translated to an average of $6.6 million per month and variations between NNPC claims and verifications by PPPRA led to over deductions of several billions of Naira.”
He pointed to the EFCC that professional fees of billions of Naira were allegedly “paid to two private Auditors for covering up the perpetrators in the fuel importation scam” and that the “exchange rates used by NNPC were lower than the average exchange rates approved by the Central Bank of Nigeria, CBN.”
He further alleged that contracts for fuel importation were awarded to companies / suppliers that were not in the approved pre-qualification list, and as a result of late settlement of invoices from suppliers NNPC allegedly paid interest rates running into millions of dollars.
The lawyer said the failure of PPPRA to regulate the supply and distribution of petroleum products and its failure to prevent collusion and restrictive trade practices led to harmful practice to the petroleum sector.
To unravel the whole process and prevent future occurrence he demanded an investigation and prosecution of the officials of the PPPRA and NNPC as well as their collaborators who defrauded the nation to the tune of several billions of Naira.