CORRUPTION BAZAAR: Over N5 trillion stolen under Jonathan – PUNCH Investigation
Published:25 Nov, 2012
Our correspondents arrived at the stolen sum after poring over the reports of the various committees set up by the President to probe some sectors of the economy, particularly oil and gas. SUNDAY PUNCH also relied on disclosures by some senior government officials.
Five trillion naira is the summation of government funds said to have been stolen, according to the Mallam Nuhu Ribadu-led Petroleum Task Force report; the Minister of Trade and Investment’s report on stolen crude; the House of Representatives fuel subsidy report and investigations into the ecological fund, SIM card registration and frequency band spectrum sale.
The Ribadu report on the oil and gas sector put daily crude oil theft at a high 250,000 barrels daily at a cost of $6.3bn (N1.2trn) a year. This puts the total amount lost through oil theft in the two years of Jonathan’s government at over $12.6bn (N2trn).
Oil theft is common in the Nigerian oil and gas sector. In June, a special naval team impounded a French ship, MT Vannessa, at Brass Loading Terminal, Bayelsa State, for allegedly stealing 500,000 barrels of crude oil per day from the country.
Our sister publication, SATURDAY PUNCH, had reported that the suspects, in their confessional statements, indicted some political office holders, many fuel marketers and some officials of the Nigerian National Petroleum Corporation and Department of Petroleum Resources.
In October, Minister of Trade and Investment, Dr. Olusegun Aganga, in a letter to the President, said 24 million barrels of oil worth $1.6bn (N252bn) was stolen between July and September.
According to Aganga, his signature was forged on the Export Clearance Permit that was used to export the crude oil from Nigeria.
Confirming that oil theft was depleting Nigeria’s resources, the Minister of Finance, Dr. Ngozi Okonjo-Iweala, in May, said the government lost a fifth of its oil revenues to theft in April.
Apart from income lost through oil theft, the Ribadu report also said ministers of Petroleum Resources between 2008 and 2011 handed out seven discretionary oil licences and that government lost $183m (N29bn) in signature bonuses via these deals.
The Ribadu panel discovered that three of the oil licences were awarded under the current petroleum minister, Mrs. Diezani Alison-Madueke, who took up her position in 2010. Alison-Madueke, however, denied knowledge of the discretionary awards.
Shortly before the Ribadu report, the House of Representatives had raised the alarm that the N2.6trn the Federal Government paid for oil subsidy in 2011 could not be properly accounted for.
The House said, “Fuel subsidy payments amounted to N261.1bn in 2006, N278.8bn in 2007 and N346.7bn in 2008, but, even after the subsidy on diesel had been removed, the ‘subsidy’ payments jumped to N2.58trn in 2011 — more than 900 per cent of the sum appropriated for the year (N245bn).”
A subsequent report by the Presidential Committee on Verification and Reconciliation of Fuel Subsidy Payments, led by Mr. Aigboje Aig-Imoukhuede, revealed that in 2011, 197 subsidy transactions worth N232bn were illegitimate.
These frauds are not limited to the oil industry, as similar probes have shown that almost all sectors are involved.
In July, the House of Representatives Committee on Environment discovered a tree seedling fraud worth N2bn awarded by the Ecological Fund office.
Chairman of the committee on environment, Mrs. Uche Ekwunife, said this during an investigative hearing on the mismanagement of ecological funds for the development of tree nurseries and seedlings in the 36 states.
According to her, out of the N3bn approved by the Presidency in 2010, N2bn was released to the contractors and consultants without government getting value.
Minister of Environment Hadiza Mailafia, however, said the contract was awarded by her predecessor.
In the telecommunications sector, the House instituted a probe into the sale of the frequency brand spectrum, which was reportedly sold for less than its value.
The 450MHz frequency, which was valued at over $50m, was allegedly sold for less than $6m (a difference of $44m or N6.9bn) by the Nigeria Communications Commission.
In the same sector, the reps, earlier this year, commenced investigations into the N6.1bn SIM card registration project embarked upon by the NCC in 2011.
The investigation followed the delay in completing the exercise and the request by NCC for additional N1bn for the project in its 2012 budget.
The lawmakers insisted that the NCC had no business embarking on the project since various service providers were already registering their subscribers.
Deputy Chairman, House Committee on Communications, Mr. Usman Bawa, had said, “The NCC has no business with SIM card registration. Apart from that, the service providers have done about 80 per cent of the registration because they started before the NCC. To me, for the regulatory body to be involved in the registration is a duplication of effort, a waste of resources and time.
“Even, the manner with which the bill for the N6.1bn was passed during the Sixth Assembly showed that there was more to it than meets the eyes. From our investigations, from which our report was compiled, our interactions with the NCC contractors for the SIM card registration and the service providers, a lot has been exposed and this was part of the reason why we removed the N1bn that was budgeted for the same SIM card registration in the last budget.”
It would be recalled that the then Minister of Information and Communication, Prof. Dora Akunyili, had, in August, 2010, agreed that the amount budgeted for SIM card registration was exorbitant.
Reacting to the massive frauds that have greeted Jonathan’s tenure, Transparency International, told one of our correspondents that Nigeria would continue to slack in development as long as it keeps paying lip service to the fight against corruption.
It said via electronic mail, “President Jonathan should insist that those accused of corruption are properly investigated and punished if found guilty, irrespective of their positions and connections. The judiciary must be seen as impartial and fair.
“To signal a break with the past, the government should set up an independent investigatory panel to review charges of corruption within government and the private sector. President Jonathan should endorse the panel and commit to ensure it has both the scope and the power to investigate and prosecute.
“This is not just a matter of justice; fighting corruption can affect the lives and livelihoods of millions of people. The current culture of corruption hurts the majority of Nigerians while the inequality gap widens.”
Also speaking to SUNDAY PUNCH, the Director, Centre for Applied Economics, Lagos Business School, Prof. Pat Utomi, said the spate of corruption in the country was unprecedented.
The political economist argued that prosecution and jail terms for corrupt individuals would not be as effective as building a societal institution that would prevent corruption.
A former Vice Chancellor, Crescent University, Prof. Sheriffdeen Tella, also warned that corruption would spell doom for the country if the trend continued.
He said, “It is unfortunate that the country will not be able to meet the Millennium Development Goals. There is a need for the masses to hold a three-day protest against corruption to force government to prosecute those indicted for corruption.”
Similarly, Executive Chairman, Coalition Against Corrupt Leaders, Mr. Debo Adeniran, said, “For Jonathan to fight corruption, he must start with his cabinet. The way Jonathan is going about his campaign against corruption is not the best way to go about it.”
A global audit and financial advisory firm, KPMG, had on Thursday stated that Nigeria accounted for the highest number of fraud cases in Africa in the first half of 2012.
The cost of fraud in the country during the period was put at $1.5bn (N225bn).