Investment & Allied Assurance Plc (IAA) has been run by an interim management since the 23rd of February this year. The National Insurance Commission (NAICOM) appointed the interim management after it discovered a N26 billion fraud. ROSEMARY ONUOHA spoke to the interim Chief Executive Officer, Mr. Yomi Rufai and he bared his mind on some of the challenges the interim management is confronting. Excerpts:

Your plan for IAA

You need to appreciate the fact that for us to be appointed interim managers of Investment & Allied Assurance Plc, we also need to put in place our work plan of what we want to achieve.

Yomi Rufai

Now that we have commenced operation as interim managers, we need to know the company well in terms of where it was, what we met on ground and going forward. Most of what we have been doing since our coming was stock taking. We are taking stock of the company in terms of assets, income, structure and liabilities. But we also have our own challenges in terms of getting data because most of the information we require to function properly are locked up in the company’s head office in Victoria Island (VI). So when we ask staff for some information they say that it is locked up in the head office and they don’t have access to it. So sometimes we just have to assume what we need to do. We have been able to commence business in a very small way and that is because the company has a number of obligations to meet to policy holders and without money we will not be able to achieve that. We are certainly working on how we can make some outstanding salary payment in a gradual manner. It is a long race we are into, it is not a short one, it’s a very long one given the magnitude of problems that we have.

Volume of IAA debt

The company debt is not difficult to quantify. It is still an ongoing exercise. We have claims obligation which we can not be able to say precisely but it is below N100 million and this is in terms of claims outstanding that we need to meet. There are other obligations in terms of creditors.

I won’t be able to know the last time the company paid claims because those records are in the head office and they are the information that we are not able to access because when the office was sealed, the staff has to relocate and most of them were not allowed to pick anything from the place. The office was locked as a result of the court case between Access Bank and IAA.

The office was also locked because IAA’s vice chairman so to speak is also managing director of Home Trust Savings and Loans Limited which borrowed money from Access bank. The Vice Chairman used IAA as collateral or as a guarantor. It is not that IAA actually owes Access Bank; rather the bank closed IAA because IAA serves as a guarantor to somebody who has taken loan. IAA is only a third party to the arrangement.

IAA assets

The company has been mismanaged. It is regrettable that this company went for private placement and was able to raise several billions in terms of capital, yet we have not been able to establish that capital. That is why we are here as interim managers. Even NAICOM stated that those monies that were raised cannot be found. So the major problem of IAA is money issue.

Hope of paying salary

With God’s guidance, we intend to surmount some of these problems. Quite honestly, it is difficult to put a timeframe on when we can start paying salary. If government security agents were up and doing as they ought to, at least they ought to get something out of the vice chairman and into the system. At least whatever portion of that money they can get back to the system, it will help to wake the company up a little and within three months there could be a lot of difference.

Length of stay

We will stay here as long as we are able to return the company to normalcy. We cannot fail unless the money fails to come. For whatever is going to happen, we must maintain the statutory requirement of a minimum of N3 billion capital base. Until we achieve that, we will still remain here. In the books kept by the vice chairman though, the capital is about N14 billion.

As regards the issue of private placement which the company did, it raised money in the capital market and recorded that it raised N11 billion. But according to the Securities and Exchange Commission (SEC) findings, the money raised by IAA was N26 billion. But the vice- chairman and his associates are saying ‘no, it is not N26 billion but N11 billion.’

However, we the interim managers, we have not seen one kobo, whether N26 billion or N11 billion. So, as far as NAICON is concerned, they are interested in making sure that the company meets the minimum requirement of N3 billion. So, if we are in a position to achieve that; meet all outstanding claims matters as well as all other liabilities of the company then we can now put in place proper corporate governance code and system. We target to do a lot of other things like having the right people in the right places. Then when the company starts looking positive, at that point we can now say ‘okay, we begin to exit from the place.’

Efforts to liaise with security agents

It is not within our domain as interim managers to contact the security agencies. NAICOM has reached out to the security agencies and that is its responsibility as a regulator and they have made their reports known to the security agencies. Our own role is to operate the company as a going concern so that we minimise the pains of stakeholders in the company. Now, minimally, we are looking out at the interest of some policy holders. Our role as interim mangers is such that if the security agencies will want to liaise with us at any point in time, we will be willing to release any information or the other. But it is not for us to be going to them and be knocking on their doors.

Other Liabilities of IAA

There are other creditors of the company such as people who have done one service or the other for the company and they are being owed, including statutory payments like tax obligation. But since NAICOM appointed us, it is to ensure that we stop some bleeding here and there. In other words, all those monies that were siphoned from the company as they come in, is no longer possible. The public is beginning to have some confidence in the company because the people that are on ground now are government appointees and we are talking to them, particularly those with large claims, we are assuring them that we are looking at the books. As soon as things normalise, we will attend to them.

Office presence

It is deliberate that this present office building which we are using now does not have any signpost indicating that IAA is operating here because the court matter between Access Bank and IAA is subject of abuse. It looks to us as if there are some under tones which we are yet to understand. It wasn’t as if IAA borrowed money from the bank, IAA only serve as a guarantor. But in terms of what Access Bank is trying to do is like they are trying to help kill this place. In other words, they don’t want IAA to exist. If Access Bank is saying ‘IAA, you owe me money,’ what is right is to allow IAA to be in a position to pay back the money. Rather what they are trying to do is to kill the place by sealing it up. If you seal the place, then how will IAA pay your money back? So, that is the area that is still very difficult for us to comprehend. I see no reason why Access Bank must insist that IAA’s office must be closed down because if you close down that office, how do you expect IAA to pay you back your loan? We have written letters to Access Bank but they are yet to get back to us. We have made efforts that we want to sit down with them and actually diagnose the problem so that we can find solutions. We are trying to look at it from a commercial angle, because if somebody owes me, what I will be looking forward to is how that person can pay me back. But if you have closed down the person’s office that means there is no way the person can pay back. We have made efforts, told them we want to hold a meeting with them. NAICOM is aware. At least we are in the process now, so where we need further intervention or further cooperation of NAICOM towards that, we will get it from NAICOM. So, our aim is to actually get to the root of the matter. Why must you lock somebody’s operational office where he makes money from?