By Robert Egbe
The Supreme Court will Tuesday hear an appeal by the Central Bank of Nigeria (CBN) and Union Bank of Nigeria (UBN) seeking to set aside a £2.159 billion judgment debt awarded Petro Union Oil and Gas Company Ltd.
The appeal followed Petro Union’s victory at the Federal High Court, Abuja and Court of Appeal.
The CBN and UBN prayed the apex court to quash the lower courts’ decisions on the grounds, among others, that Petro Union’s claim to the sum was allegedly based on fraud.
The banks are contending that Petro Union allegedly obtained two judgments at the Federal High Court and the Court of Appeal based on facts which were not only predicated on falsehood, but which have criminal implications.
The appellants averred that these facts, if not carefully dissected by the Supreme Court, may occasion a miscarriage of justice capable of ruining the nation’s fledgling economy.
The further averred that the judgment obtained by Petro Union at the Federal High Court in 2014 for £2.556 billion also carries an interest of 15 per cent per annum from 22nd June 1995 until payment. Today, that judgment sum together with interest is in excess of £12 billion (about $15.5 billion) – 50 per cent more than the award in the Process and Industrial Developments Limited (P&ID) case and represents 44 per cent of Nigeria’s foreign reserves.
They further claimed that the truth of the alleged fraud had been uncovered following the arrest, detention and ongoing prosecution of Petro Union and its officers at a Federal High Court in Lagos.
Last February 13, Justice Mohammed Liman remanded four Petro Union directors over alleged £2.556b fraud.
The judge made the order following their arraignment on a seven-count charge of fraud preferred against them by the Economic and Financial Crimes Commission (EFCC).The charge is marked FHC/L/46c/2020.
The high court trial resumes on Wednesday.
Public interest in the Petro Union’s case was rekindled in 1994 when the company allegedly obtained a cheque from a branch of Barclays Bank in the United Kingdom (UK) with a value of £2.556b.
The EFCC alleged that an attempt was made to present the cheque at one of Union Bank’s branches in Lagos, under the pretext that it was meant to construct three petrochemical refinery complexes in Nigeria and establish a bank.
It was further alleged that while the required due diligence investigations were being carried out, Petro Union’s Managing Director, “one Mr Okpala,” inundated the Bank and the CBN with demands for the release of the cheque.
Both the CBN and Union Bank were said to have advised Petro Union that Barclays Bank in the UK had been contacted and would confirm that the cheque dated 29 December 1994 could not be given value to because the company that purportedly issued it (Gazeaft Ltd) did not exist on the Register of Companies in the UK.
They averred that confirmation was obtained that the account on which the cheque was drawn was closed on September 21, 1989, whereas the cheque was issued on December 29, 1994 – five years after the account was closed.
They claimed that despite the decisive response, Petro Union and Isaac Okpala persisted with their demands and this culminated in a petition by the company to the Lagos office of the EFCC.
Following, the petition, the EFCC investigated the allegation by interrogating the CBN through a letter dated January 12, 2005.
In a letter dated 27th January 2005, the CBN denied Petro Union’s allegations.
The EFCC was further said to have made other efforts to investigate the allegations including corresponding with Barclays Bank in the UK.
The anti-graft agency then issued a letter dated 10th May 2005 addressed to the Managing Director of Union Bank exonerating the bank of any wrongdoing.
But Petro Union in February 2012 instituted an action at the Federal High Court, Abuja against the CBN and Ors in Suit No. FHC/ABJ/M/104/2012.
It sought reliefs against the CBN, Union Bank, the Minister of Finance and the Attorney-General of the Federation.
It claimed that Union Bank of Nigeria received the £2,556,000,000 on behalf of Petro Union and transferred the sum of £2,159,221,318.54 to the CBN while retaining the sum of £396,778,681.46 as commission.
In support of its claim, Petro Union alleged that the money is kept in an account in the name of a company called Goldmatic Ltd at the CBN and tendered an alleged CBN Statement of Account of Goldmatic Ltd.
Justice Kafarati accepted the alleged CBN Statement of Account as conclusive evidence that CBN had retained the money alleged to belong to Petro Union.
The CBN had contended that globally, a central bank cannot open an account for a private entity – since a central bank is statutorily empowered to act as bankers to government and bankers to banks.
Petro Union and its directors pursued the case up to the Court of Appeal where they obtained judgment to establish that the £2.159 billion was lodged in the coffers of the CBN.
