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EFCC set to probe 3 sacked bank chiefs

ISTANBUL, TURKEY — The Chief executives of Bank PHB, Spring Bank and Equitorial Trust Bank sacked by the Central Bank are to appear before the Economic and Financial Crimes Commission, EFCC, to answer questions in connection with some of the decisions taken while they presided over the affairs of the three banks.

Dropping the hint yesterday at the just-concluded World Bank/ IMF annual meetings in Istanbul, Turkey, Executive Chairman of the anti-graft agency, Mrs Farida Waziri, while fielding questions from journalists during a joint press briefing with the Finance Minister, Dr Mansur Mukhtar and the CBN Governor, Mr Lamido Sanusi assured that nobody will be treated as a sacred cow in the latest exercise.


She also said that the debtors of the three banks should prepared to face the EFCC as soon as the CBN makes its list available to the Commission.

She declared, “As soon as we return home, we take on the case of the latest three banks. I can assure you that nobody will be spared, no sacred cow. We will handle it the way we did the last set.

So there can not be any discrimination or preferential treatment for anybody. We will also act on the debtors’ list as soon as the CBN releases that to us. It is in the interest of our economy and the nation.”

She said that a distinction has to be made between genuine loans which had proper documentation and the spurious ones which, from the very beginning, were contracted with the intention not to pay. She said those which loans were genuine but had difficulties in repayment were not arrested but given time to pay up what they owed.

Speaking later at a policy forum on good governance, investment climate and the challenge of increasing capital flows to Africa, Mrs Waziri justified the EFCC intervention in the bank reform process in Nigeria saying “at face value, there should be no basis for the EFCC’s involvement in the recent banking sector cleansing and the recovery of debts.

However, we must understand that section 7 (2) of the legislation establishing EFCC states that the EFCC ‘shall be the coordinating agency for the enforcement of the provisions’ of the following key legislations:

•The Failed Banks (Recovery of Debts) and Financial Malpractices in Banks Act 1994.
•The Banks and other Financial Institutions Act (BOFIA) 1991

“These two sets of laws alone should suffice to justify the involvement of an organisation like the EFCC in the bank cleansing exercise and the recovery of loans by the Central Bank of Nigeria. However, it may be necessary to go beyond that. The general issues arising from the exercise in Nigeria have shown that margin loans, other forms of loan facilities and infraction by lenders are the critical areas that rogues within the system utilised”.

She disclosed that the Commission’s intervention has led to the recovery of over N114 billion (about $700 million) and prosecution of four bank chief executives, 11 directors and one chief executive of a stockbroking firm on 188 count charges.

Waziri said with the firm efforts of various regulatory agencies to cleanse the system, the investment climate is now open to foreign investors who are interested in doing genuine business in Nigeria. She called for international cooperation among law enforcement agencies to support business transactions and check trans-border crimes,

According to her, “from a transnational perspective, if it is accepted that the financial system impacts not just on the economy, but also the politics and polices of countries, then it is necessary that innovative solutions in law enforcement should also follow suit.

I will suggest in this context that countries must resolve that as a matter of protocol, rather than upon request, Suspicious Transaction Reports that might impact on each other must be shared promptly.

For instance, if  Country ‘A’ gets a Suspicious Transaction Report that has a Nigerian element, then country ‘A’, as a matter of protocol, must share that Suspicious Transaction Report with Nigeria even where Nigeria has not made a request for such.

This will enable countries keep track of illicit economic activities even across their borders and might even be the basis of triggering fresh investigations.

In any case, it is irrefutable that the barbarians within the system often launder the proceeds of their crimes across transnational borders and this mode of cooperation will be useful in tracking deposits and assets.

“From a practical point of view, this mode of cooperation is further recommended by the fact that looted funds are often re-routed to designated financial safe havens and tracing or investigating it is often a frustrating experience.

If the safe havens become unattractive with the attendant difficulty in spiriting away looted funds, investigating and prosecuting several shades of financial crimes should be relatively easier.”


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