Paris Club Refund: Malami’s Action against Public Morality, Interest, Say Govs

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The 36 State Governors under the umbrella of the Nigeria Governors’ Forum (NGF) have strongly chastised the Minister of Justice and Attorney General of the Federation (AGF), Abubakar Malami over his directive to pay the Paris Club Consultants, even when the matter was still in the Court of Appeal.

The governors stated this in reaction to the directive by the Minister of Justice and Attorney General of the Federation in a statement yesterday, by the Head, Media and Public Affairs, NGF, Abdulrazaque Bello-Barkindo, insisting that the mere fact that Malami directed the Minister of Finance to pay was very suspicious.

Malami had in a statement at the weekend issued by his Special Assistant on Media and Public Relations, Dr. Umar Jibrin Gwandu, faulted the insinuation that he was acting without due process in the settlement of certain judgment debts arising from the deduction and refunds due to the states and local governments from the Paris Club loan refunds, insisting that at the onset, the deductions were on account of four judgments in contention which were delivered at various times in 2014, 2015, 2017 and 2019.

However, the governors in their statement stressed that the directive by Malami was against public morality and the interest of the Nigerians, while describing some of the claims by the consultants as dubious.

In the statement, the governors argued that the decision by Malami to throw his weight behind the consultants that had been battling desperately to grab $418 million from the accounts of states and local governments raises questions of propriety and the spirit of justice.

The governors explained: “The AGF is supposed to be the chief arbiter in all matters concerning Nigerians, especially the poor masses of this country. It is incumbent upon him to, not just ensure that justice is done, but that justice is seen to have been done.

“The undue haste, with which the statement was issued even before the service on the AGF of the court processes and the order dated November 5, 2021, restraining the federal government, seems to suggest that there is a special relationship between the Office of the AGF and the consultants over and above Nigerian citizens, whose interest the AGF as the chief law officer of the federation is statutorily bound to always protect.

“The statement also suggests that the restraining order issued last Friday, not only unsettled preconceived plans and angered the unnamed ‘government officers’ referred to by the media aide.”

They added: “The media aide to the AGF justifies the deductions on the basis that they are made pursuant to four court judgments; two of which are consent judgments and/or that the Nigeria Governors’ Forum/States and LGAs consented, expressed no objection to the payments and had already paid part of the debts to the said contractors and consultants.”

It also noted that the statement by the media aide to the AGF failed to name the judgments under reference and whether they were going to appeal or challenge it in any way.

“He also failed to specify which of the four judgments authorised payments and in what proportion to each of the contractors,” the governors stated.

The governors pointed out that while it was easy to argue as the AGF did, that the NGF and ALGON took no early steps to appeal as they should have done, adding that it was important to inform the Nigerian public that state governors have since appealed and are presently challenging the judgments in various courts.

“Interestingly, the AGF has been served all these processes. Nevertheless, this was ignored and payment was authorised to be made and has been processed with unprecedented speed not common in the public service. It must be stated that between the NGF and AGF, the latter was in more vantage constitutional position and has a legal responsibility and burden to defend public interest,” the statement added.

The governors stated that the AGF should have initiated appeals against the said judgments once his attention was drawn to them, because public interest was at stake involving huge sums of money meant for the provision of public services.

Also, they pointed out that the state governments were not parties to any of the said judgments.

According to the NGF: “It should be further stated that the Office of the AGF failed to professionally defend the cases leading to those judgments and the courts commented on that unprofessional attitude.

“While we are constrained not to comment on a subject which is subjudice, we have a responsibility to the public to respond in some details to the statement issued by the Office of the AGF in order to put the records straight.

“Any discerning legal mind would find no difficulty in concluding that the so-called judgments under reference are dripping with too many irregularities bordering on competence and lack of jurisdiction which are the bases why some of them are being challenged on appeal and in other courts. No diligent public officer would act on such judgments by recommending payment.

“It is even more curious that the AGF also recommended payments to some contractors allegedly based on judgments that did not make any monetary award or on claims that were struck out.

“The AGF may need to explain to Nigerians why these particular judgment debts are given unusual attention and priority and processed with supersonic speed over and above all others; some of which preceded these so-called judgments and have been pending for settlement by the AGF for several years”, the governors declared.”

Furthermore, they stated: “While it is convenient to say that part of these judgment debts have been paid with the release of $86,546,526.65 and N19, 439,225,871.11 in 2016 and $100 million in 2018, to the contractors with the concurrence of the NGF; that does not detract from the fact that they were payments wrongly made which ought not to have been made even if they were products of consent judgments.”

Querying the order to pay, the governors also stated: “States can still go after the contractors to recover the funds wrongly made. It should concern the AGF that ALGON disowned the contracts claimed by RIOK and the same was duly communicated to him requesting him to prevent the use of LG funds to “settle dubious and illegal claims’’

The governors therefore queried: “Was the AGF not concerned that several contractors are laying claim to legal fees for the same Paris Club Refund? Was it lost on the AGF on the detailed procedure available under the law how legal fees can be claimed in deserving cases?”

The governors further noted that, “one of the strange payments made is that of $47,831,920 million to Panic Alert Security Systems Ltd/George Uboh for allegedly reviewing a 16-page judgment for the then factional NGF.

“Can the Office of the AGF point to any consent judgment awarding that sum to Panic Alert? Did the NGF’s letter of 20th January, 2020, relied upon by the AGF ever recommend the payment of any sum?

The statement added: “LINAS and NED Nwoko in this scheme are walking away with $68,658,193.83 state funds allegedly for legal consultancy services,” asking therefore. “Is the AGF not aware that the work alleged to have been done by him was already contained in a FAAC Reconciliation Committee Report constituted in 2005 submitted in 2007 with recommendations on how states and LGAs should be refunded the over charges from the Paris Club Refunds.”

The NGF alleged: “Dr. Ted Iseghohi-Edwards has been paid the sum of $159 million in promissory notes, yet he had his matter in Suit No FCT/HC/CV/1353/18 struck out on November 10th, 2020.

“Furthermore, the legal basis for his claim is rooted in Suit No. FHC/ABJ/CS/130/13: LINAS International Limited & 235 ORS V FGN which clearly stated that he cannot benefit under the judgment because he was not a party in the case and cannot enforce the terms of the judgment. Contrary to the representation of the AGF, the EFCC’s report on TED was negative.

“The report not only recommended his arrest but a forfeiture of any of his assets associated with the Paris Club Refund. The AGF ignored these recommendations.”

The governors further disputed the payments to RIOK to whom the AGF supports and recommended the payment of $142,028,941.95.

Accordingly, the governors stated: “This was confirmed by the Court of Appeal in Appeal No CA/558/2017. That is the appeal now before the Supreme Court (SC). Which Judgment then is the basis of the AGF recommendation that RIOK be paid the sum of $142,028,941.95.

“There is also no evidence of execution of any contract by RIOK. Curiously, the Department of State Security (DSS) is alleged to have confirmed 50 per cent execution. The Court and EFCC stated clearly that it is not the responsibility of the DSS to ascertain the execution of contracts as they do not have the expertise.

“ALGON disowned the contracts. Why will the AGF insist on them? It is not true that the EFCC in its report recommended payment to the contractors. It did not.

“In the case of payments recommended and paid to Prince Orji Nwafor Orizu $1,219,440.45, and Olaitan Bello – $215,195.36, it remains a mystery. These two lawyers are alleged to have performed legal services for RIOK and its associated companies and not for the states or LGAs. Why they are paid from State resources is only imagined.

“The AGF also claims he intervened to pay the contractors to avoid execution of the judgments against the federal government resources. That is absolutely not true at all. Assets of the FGN were not at any time threatened. The NGF is not aware that there is any existing mandamus issued by any court in favour of the contractors against the federal government.

“The only application for mandamus by Panic Alert is pending for hearing at the Federal High Court and parties have since joined issues.

“The AGF also says that the NGF and LGAs seek to transfer their liability to the FGN. That is not true. There is no liability to transfer in the first place and none exists; neither has the NGF provided any undertaking or indemnity to the FGN to act on its behalf as represented by the AGF.”

Meanwhile, Malami maintained that two of the judgments were Consent Judgments based on Terms of Settlement entered into by the NGF in 2017 and 2019.

He noted that two of the four judgments were based on an earlier judgment delivered by the Federal High Court in 2013.

“It is, however, amazing that from 2013 – 2021 neither NGF nor ALGON deemed it fit to either challenge or fully comply with any of these judgments. In furtherance of the consent and settlement the NGF itself made payments in billions to the consultants based on the same judgment it is deriding now.

“By various letters addressed to the Attorney General of the Federation and Minister of Finance, both NGF and ALGON expressed no objection and actually recommended the same set of consultants for payment. Indeed, the judgment debts were much higher than the above figure, but these officers ensured that the Consultants granted consistent concessional offer,” he added.

According to him, his office had subjected the claims of the consultants/contractors to investigations by both the DSS and EFCC in order to further ascertain its veracity, adding that recommendations for payment were made based on the positive outcomes of the investigations.

Malami maintained that since both the NGF and ALGON that had entered into judicial settlement on account of which consent judgment was entered refused to comply with the judgments, “it became pertinent for the federal government to take the initiative in order to prevent a situation where the debt liability of NGF and ALGON would be transferred to the Federal Government and eventually excluded against its assets and interest.”

“The interest of the federal government to intervene in the negotiated settlement was borne out of the fact that the consultants made the federal government a party to the action against NGF and ALGON the implication of which was that the judgment may be executed against the interest and assets of the federal government over liability that was incurred exclusively by NGF and ALGON in respect of which the federal government is not responsible.

“It is curious to note that both NGF and ALGON who had actual knowledge of these judgments between 2013 and 2019, consented to their partial compliance and also undertook in 2019 to settle them from their FAAC Allocations, only turned around in 2021 to take steps to challenge the judgments.

“The federal government acted on the Undertaking/Indemnity provided by NGF. More so the judgment creditors also obtained orders of mandamus compelling the issuance of the promissory notes.”

The statement added: “It is remarkable to note that the NGF at various times in 2016 and 2018 received payments from the federal government under the guise of legal and consultancy fees related to the same Paris Club refunds. Specifically, NGF was paid US$86,546,526.65 and N19,439,225,871.11 in 2016 and US$100,000,000.00 in 2018. It was however, convenient at that time not to complain about payment of consultants.

“Thus, the federal government did not act in vacuum before the decision to comply with the existing judgments was taken. The federal government could not fold its arms and watch while the consultants/contractors had already obtained garnishee order absolute attaching the funds of the Federal Government in the Central Bank of Nigeria on account of the fact that the refunds of the Paris Club loans were made by the federal government to the states and local governments in contempt of an existing court judgments procured against NGF and ALGON by consent.”

He argued that the federal government did not resort to arbitrary deductions of funds belonging to states and local governments, saying it was rather in furtherance of the need to settle judgment debts judiciously consented to by NGF and ALGON that were incurred but in respect of which they are seeking to transfer the liability of same to the federal government.

“Thus, the media onslaught on what played out at FAAC October meeting that states won’t be able to pay salaries on account of the deductions is far from the truth as the problem is self-induced being a product of contractual negotiation in respect of which NGF and ALGON submitted to judicial decision legitimately entered by their consent.

“The Attorney General of the Federation denies any wrongdoing in the steps that have been taken so far to comply with the various court judgments and is also not party or privy to any of the sinister agenda or plots being insinuated in the malicious publications, but maintains that he has a responsibility to protect Federal Government from bearing liability of a judgments debt incurred by Nigerian Governor’s Forum and ALGON which is mischievously being transferred to the federal government,” it added.


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