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SHOCKING: 3 million Nigerians lost N18 billion to MMM – NDIC

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The Nigerian Deposit Insurance Corporation (NDIC) has said while quoting the social media that an estimated three million Nigerians have lost N18 billion in the Phonzi scheme, popularly called Mavrodi Mundial Movement (MMM).
Speaking at the NDIC day at the ongoing 38th Kaduna International Trade Fair on Thursday,the Managing Director of the corporation, Alhaji Umaru Ibrahim decried that despite repeated warnings by the Central Bank of Nigeria (CBN)  and the corporation, Nigerian’s still patronise MMM.
Represented by the Deputy Director Corporate Affairs,Hadi Suleiman,the MD emphasised that the creation,  usage or trading in the Phonzi scheme in forms of virtual currencies,  such as Bitcoin, Ripples, Monero, Litecoin, Dogecoin and Onecoin as currencies for medium of exchange are Internet-based transactions and are not authorized by the CBN due to the risks involved in their operations.
He cautioned that any person or groups of persons who invest their money in the Ponzi scheme does so at their own risk.
He added,”The Ponzi scheme is the phenomenon of illegal fund managers,popularly called “Wonder Banks” which have continued to defraud unsuspecting members of the public of their hard earned money. This phenomenon has been a source for concern because despite our repeated warnings over the years,  some members of the public have continued to fall victims of their fraudulent practices.
“We would like to reiterate the fact that these fund managers are illegal as they are neither licenses by the CBN to take deposits from members of the public not are those who patronize them covered by the NDIC deposit insurance scheme.  I want to also draw the attention of some cooperative society which often go beyond their primary mandate by accepting contributions from members as cooperative societies are only recognized to mobilize savings from their members.”

NDIC reveals how much Nigerians lost to MMM

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The Nigerian Deposit Insurance Corporation (NDIC) has said that an estimated three million Nigerians have lost N18 billion in the Ponzi scheme, popularly called Mavrodi Mundial Movement (MMM).

Speaking at NDIC day at the ongoing 38th Kaduna International Trade Fair on Thursday, the Managing Director of the Corporation, Alhaji Umaru Ibrahim decried that despite repeated warnings by the Central Bank of Nigeria (CBN) and the corporation, Nigerian’s still patronise MMM.

He noted that the creation, usage or trading in the Ponzi scheme in forms of virtual currencies, such as Bitcoin, Ripples, Monero, Litecoin, Dogecoin and Onecoin as currencies for medium of exchange are Internet-based transactions and are not authorised by the CBN due to the risks involved in their operations.

He cautioned that any person or groups of persons who invest their money in the Phonzi scheme does so at their own risk.

He added,”The Phonzi scheme is the phenomenon of illegal fund managers, popularly called “Wonder Banks” which have continued to defraud unsuspecting members of the public of their hard earned money. This phenomenon has been a source for concern because despite our repeated warnings over the years, some members of the public have continued to fall victims of their fraudulent practices.

“We would like to reiterate the fact that these fund managers are illegal as they are neither licences by the CBN to take deposits from members of the public not are those who patronise them covered by the NDIC deposit insurance scheme. I want to also draw the attention of some cooperative society which often go beyond their primary mandate by accepting contributions from members as cooperative societies are only recognised to mobilise savings from their members. “

NDIC launches plan to shut down MMM in Nigeria, insists it is fraudulent.

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The Nigeria Deposit Insurance Corporation, NDIC, has revealed plans to shut down Mavrodi Mondial Movement, MMM, scheme in Nigeria.

The Managing Director, MD of NDIC, Alhaji Umaru Ibrahim, disclosed that the regulators had set up a Committee to stem the nefarious activities of the fraudsters across the country.

Speaking on Monday during the NDIC Special Day at the 2016 Lagos International Trade Fair, Umaru advised members of the public to patronize only banking institutions that display the NDIC sticker: ‘Insured By NDIC’ in their banking halls or entrances.

He lamented that despite repeated warnings, Nigerians were still trooping out to patronize the illegal fund managers.

The MD said, “I wish to sound a word of caution to members of the public on the activities of illegal fund managers, otherwise known as Wonder Banks.

“It is worrisome to note that despite repeated advice, many unsuspecting members of the public are still falling victims to the mouth-watering interest being offered by these illegal fund managers.

“However, the regulatory authorities have set up an inter-agency committee under the Financial Services Regulatory Co-ordinating Committee (FRSCC) to stem the nefarious activities of those fraudsters across the nation,” he added

This is coming at a time when there were growing apprehension that the MMM scheme was fraudulent.

Recall that the Minister of Solid Minerals and Steel Development, Dr. Kayode Fayemi, had dissociated himself from the MMM, saying he had nothing to do with it or any other online financial aid community, projects or contracts.

Also, the Central Bank of Nigeria, CBN, had warned Nigerians to be wary of it, referring to the scheme as a “wonder bank”.

The head of the consumer protection department of the CBN, Kadija Kassim, had said, “But I want to warn you against it because they are wonder banks that are not regulated.

“Desist from their activities because they are fraudulent.”

Only 2% Of Nigerians Own 90% Of Bank Deposits – NDIC

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As a major indicator of wealth distribution in Nigeria across income groups, a mere two per cent of Nigerians own 90 per cent of total deposits in Nigerian banks. This represents the wide gap between the rich and the poor in Nigeria, which continues to pose major socio-economic development challenges to the nation.

 

Director of Research and International Relations at the Nigeria Deposit Insurance Corporation, NDIC, Alhaji Mohammed Umar, disclosed this at the Businessday Capital Market Development Annual Conference in Abuja, yesterday.

His words: “Our current deposit insurance coverage is N500, 000 for the Deposit Money Banks. And some people have said that it is low. I can tell you that it is very adequate for the majority of accounts. “It will interest you to know that it covers over 90 per cent of accounts in the country. Indeed, Nigerians who have more than N500, 000 in their accounts are just two per cent. Emefiele CBN Governor “What we found is that this two per cent Nigerians have 90 per cent of banks’ total deposits. Look at that – two per cent Nigerians own 90 per cent of total banks deposits, while the remaining 98 per cent have just 10 per cent of total deposits.  What that tells you is that the gap between the rich and the poor has continued in this country.”

 

Alhaji Umar added that there were about 70 million bank account holders in the country.

 

The total bank deposits stood at N17.2 trillion, as at December 2015, according to a post on the Central Bank of Nigeria, CBN, website.

Earlier in his address, the Director-General of the Securities and Exchange Commission, SEC, Mr. Mounir Gwarzo, urged Pension Fund Administrators, PFAs, to invest more in the nation’s capital market, with a view to deepening it and ensuring better returns on contributor’s funds.

He said: “Deepening Nigeria’s Capital Market through Maximum Utilization of Pension Funds is a conversation our country must continue to have in order to ensure that the impressive pool of savings we have been able to mobilize over the last decade is put to productive use for inclusive economic growth. “We are confident that with greater participation by PFAs and return of retail investors, our capital market will emerge as one of the world’s biggest and most liquid market capable of supporting the socio-economic development of our country. “We are delighted that the National Pension Commission, PenCom, has been very proactive in making the necessary adjustments to the guidelines that allow PFAs sufficient flexibility to determine their optimal strategic asset allocation. “The draft new regulation on investment of pension fund assets allow the investment of up to 30% in equities (for Fund type 1) and up to 45% in corporate debt securities (for Fund types 3 and 4). As a whole, we believe the adoption of a multi-fund structure is a very positive development that should produce economies of scale, risk diversification and further deepen the Nigerian capital market through pension portfolios and management strategies of PFAs. “There is, therefore, an urgent need for the draft guidelines on multi-fund structure to be approved. “The question is: Based on the current asset allocation by Nigerian PFAs, are they paying sufficient attention to generating the necessary returns to provide sustainable benefits to contributors? Can we say that Nigerian PFAs have achieved an optimal strategic asset allocation or explored all viable investment outlets? “March 2016 data from PenCom shows that Nigerian PFAs invest only 8.16% of their assets in the domestic listed equities market and 1.24% of their assets in foreign equities.

 

‘Credit: Vanguard

Casual Workers Responsible For Fraud In Banks – NDIC, CIBN

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The Nigeria Deposit Insurance Corporation (NDIC) and the Chartered Institute of Bankers of Nigeria (CIBN) has cautioned banks on the use of casual workers, stating that over 75 per cent of fraud cases in the sector had been traced to outsourced bank staff.

The managing director and chief executive of the NDIC, Alhaji Umaru Ibrahim, called for a closer look at the phenomenon of outsourced or contract staff in banks to ensure healthy and sound practices in the banking industry.

According to him, bank examination reports had indicated that the high incidences of fraud and forgeries in the banking system had been linked to outsourced or contract staff.

Umaru also said that in as much as regulators appreciated the necessity for banks to cut costs, it was incumbent on all stakeholders to fashion out capacity building and other strategies to motivate all employees to contribute positively rather than engaging in criminal acts that impact adversely on the entire banking system.

The CIBN president, Otunba (Mrs) Debola Osibogun, during a courtesy visit to the NDIC, regretted that a large percentage of fraud cases in the banking sector are traced to outsourced bank staff who were neither professionals nor members of the CIBN. While noting that the institute had no control over the banks, Osibogun disclosed that a committee of the institute was already working with heads of operations of banks on the challenges posed by the outsourced staff and would soon submit its report to the Central Bank of Nigeria (CBN) for consideration.

The CIBN president also said that the institute had been mandated as the agency for competency framework for banking industry by the CBN, adding that the CIBN had visited banks’ academies and had issued accreditation certificates to the academies of the First Bank, Access Bank and Guaranty Trust Bank.

Doyin Okupe Dragged To Court Over N34 Million Debt

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The Nigerian Deposit Insurance Corporation, (NDIC), has urged a Federal High Court in Lagos to place a debt recovery suit filed against the Senior Special Assistant to President Goodluck Jonathan, Dr Doyin Okupe and two others on an undefended list.

NDIC, who is the Liquidator of defunct Gulf Bank of Nigeria Plc, made the application following alleged failure of Okupe and other defendants in the eight year old case to file their defence.

Apart from the president’s aide, other defendants in the case are: an investment company, Value Trust Investment Limited, and a Director of the company Ray Ahazie.

NDIC is claiming Okupe, who is the chairman of the company and other defendants owe the sum of N34,168,064.51 as outstanding balance of a loan they took from liquidated Gulf Bank Plc in 2000.

The corporation is also claiming interest on the said sum at the rate of 21 per cent per annum from May 2007, until the final liquidation of the said sum.

NDIC in a statement of claim filed on its behalf by its counsel, Dr Abiodun Layonu, alleged that the defendants were granted a credit facility in October 2000, by Gulf Bank Plc, to finance the importation of 10,000 metric tonnes of rice for onward delivery to the Bayelsa state government in the sum of N448 million vide an offer letter dated 27 October 2000, and that the terms and conditions of the offers and acceptance were later formalised in a memorandum of agreement duly signed and stamped by the bank and defendants.

The plaintiff (NDIC) averred that in securing the facility granted the defendants, the Bayelsa state government through its banker, Societe Generale Bank granted a bank guarantee in contract sum of N500 million in favour of Gulf Bank and in further securing the facility, the Investment company’s directors, Dr Okupe and Ahaze, entered into joint and several guarantee to pay full amount granted in favour of the Gulf Bank.

The bank also by way of security has a lien on the shipping documents in respect of the goods financed.

NDIC further stated that when the ship carrying the 10,000 metric tonnes of rice arrived Nigerian territorial water on December 28, 2000, it could not berth at Apapa Port until January 03, 2001, because the port was congested and that the ship arrived Port Harcourt territorial water on July 26, 2001, but refused to berth on the ground that the shipping agency fee $155,000, (about N18.6 million) had not been paid.

Upon enquiry, the Nigeria’s representative of the shipping company, Koda International Nigeria Limited, informed Gulf Bank that a bill of $155,000, had been sent to the first defendant, Value Trust Investment Limited, for settlement as per the agreement between the investment company and the Oversea Supplier, Luck Rice International.

That when it appears that the investment company could not come up with the $155,000 USD, forming the shipping agency fees, Gulf Bank decided to pay the fee to Koda International Nigeria Limited.

NDIC further averred that when Bayelsa state government reneged on its promise to take the rice, Gulf Bank was forced to commence an open market sale of the rice.

At the end of the sale, Gulf Bank was only able to realise the sum of N454,574,150, in the account resulting in a difference of N70, 425, 850 between the initial overdrawn position of N525 million in Value Trust Investment Limited account, and the difference has been attracting interest since 2001.

Sometimes in September 2005, it had a meeting with the defendants at the Ikoyi office of Economic and financial crime commission (EFCC) with a view to resolving the indebtedness of the defendants.

It was agreed in its letter dated September 21, 2005, to waive the sum of N196,642,996.08, from the outstanding debt of N240,811,060.59, thereby repayment due to Gulf Bank stood at N44,168,064.51 and sequel to the meeting at the EFCC office in September 2005, the defendants were only able to pay the sum of N10 million leaving the outstanding balance unpaid in the sum of N34, 168, 064, 51.

However the defendants have refused, neglected and failed to liquidate their indebtedness despite repeated demand on same despite the fact that the defendants have admitted owing the aforesaid debt, as this was evidenced in their letter dated February 15, 2006.

Consequently, NDIC is claiming the sum of N34,168,064.51, being the agreed outstanding indebtedness of the defendants; and interest on the said sum at the rate of 21 per cent per annum until the final liquidation of the said sum. It is also claiming the cost of instituting this legal action.

When the matter came up for hearing, the NDIC lawyer, Oburume Ayeteno told the court that he has filed an application to place the suit on undefended list which he was ready to argue.

But Okupe’s counsel, Yemi Gbonegun objected on the ground that he had filed a statement of defence on behalf of the defendants but the statement of defence which the plaintiff had file a reply to cannot be traced in the court’s file, consequently he needed time to reproduce the said statement of the defence.

The presiding judge, Saliu Saidu adjourned till 8th of July 2015, for Gbonegun to regularise his position.