January 07, (THEWILL) – Some notable national newspapers, television stations and news websites used words like “Raid” and “Gestapo” in their headlines to describe last Thursday’s Economic and Financial Crimes Commission (EFCC) operation at the Dangote Lagos headquarters in the ongoing probe of alleged misuse of foreign exchange sourced from the central bank.
Dozens of companies, including BUA, Flour Mills, Tropical General Investments Group, TGI and financial institutions are the targets of investigation being conducted by the EFCC and the Special Investigator, Jim Obazee, appointed by President Bola Tinubu to investigate and recover state monies stolen from government coffers.
According to the reports, EFCC personnel on Thursday visited the headquarters of the Dangote Group, one of Africa’s largest conglomerates in Lagos, and demanded documents relating to the allocation of foreign exchange to the Group by the Central Bank in the last 10 years. Same documents which anonymous sources close to the billionaire founder of the Dangote Group, Aliko Dangote, said had been sent to the anti-graft agencies weeks before their visit.
After scrutinising the documents provided by officials of Dangote Group for some hours, the operatives of the agency carted away the documents and summoned some staff to its Abuja headquarters.
THEWILL gathered that BUA Group, Flour Mills of Nigeria Plc and the other companies in focus as well as some banks have since submitted documents demanded from them by the state backed anti-graft investigators.
Explaining the development to THEWILL on Friday morning, a top level EFCC source, who craved anonymity, said that what looked like a sudden swoop on the companies was a follow-up to the reports presented to President Bola Tinubu by the special presidential investigator into the books of the Central Bank of Nigeria, CBN.
He told this newspaper, “We are not talking about records, otherwise we would have issued a statement. I know that the visit to Dangote Group on Thursday by our operatives was in relation with Mr Obazee’s investigation into the allocation of forex and the alleged abuse of multi-exchange rate under the leadership of Mr Godwin Emefiele and all the companies that benefited from the abuse.”
According to the official, the mission of the Commission is three-fold; “to determine the level of involvement, how much was taken, when it was taken and then to act on that. The investigation is ongoing and no categorical statement can be made on when it would end.”
Indeed, a fortnight ago, the Obazee-led committee unveiled alleged massive looting of monies from the nation’s treasury during the administration of ex-President Muhammadu Buhari.
The report indicted a former Minister of Finance, Hajia Zainab Ahmed; the ex-Accountant General of the Federation, Idris Ahmed; the former board of the CBN, former Governor, Godwin Emefiele and the deputy governors.
Emefiele, who is presently facing trial over alleged breach of procurement procedure and the former board have however denied any wrongdoing with Emefiele releasing a statement describing the content of the report as “False, misleading and calculated to disparage my person, injure my character and serve the selfish interest of the private investigator.”
A call to presidential spokesperson, Chief Ajuri Ngelale, to clarify the status of the special investigator’s report and EFCC’s current investigations proved abortive. However, a presidential aide told THEWILL that there was nothing to say on the matter.
Tope Ajayi, Senior Special Assistant to the President on Media and Publicity, simply said, “The EFCC is an independent organisation,” maintaining the Commission is acting independently from the presidency.
Efforts to get comments from the Head of Corporate Communications, Dangote Group, Mr Tony Chiejina, failed as his phone was unreachable and text messages sent to him were not replied.
RIPPLES IN BUSINESS COMMUNITY
Nonetheless, the EFCC inquisition, the DSS as well as those being done by the Special Investigator on Nigeria’s two major companies seen as rivals in the industrial sector, Dangote Group and BUA Group, sent shivers down the spines of other members of the business community in Nigeria. According to THEWILL checks, the common perception among those interviewed was the timing and procedure.
The Tinubu administration which inherited a weak and cash strapped federal government when it took over in May last year, promised to bolster revenue and revive the very frail economy.
Almost all the respondents, who wished to remain anonymous for obvious reasons, said they welcomed the government’s probe, recovery and even prosecution of those found guilty of corrupt practices, but then the method must be such that “the end of the goal is not counterproductive.”
Some said the sensitivity of the manufacturing and industrial sector meant that the investigations should be done discreetly so as not to send the wrong signal to investors “who are still adopting a wait-and-see position,” despite official trips abroad by the President to woo investors.
“This kind of move sends the wrong message to potential investors, local or foreign. After all, this matter has to do with paperwork. It is a question of telling the CBN to submit the list of everyone involved in large forex exchange dealings, get the banks to give the information of the companies detailing what was sold and bought and then demand documents from the beneficiaries to prove how they used the forex and then continue investigations from there.”
According to one respondent, who understands the workings of the economy, the country is still “declining in all the indices of development, the economy is unattractive to investment because of the worsening insecurity, decayed infrastructure and weak dispute settlement structure of the judiciary.”
Tainting a major company like Dangote Group with a $19 billion refinery investment with fraud, the respondent added, is “just not good for the optics. Makes no sense at all.”
The general view among the respondents is that the development is a sad commentary on a government that is combing all the nooks and crannies of the globe for foreign investors. More so, when a number of reputable multinationals are delisting from the Nigerian Exchange and closing shops after centuries and decades of operation in the country.
Over N220 billion was wiped out from the Nigerian Exchange, following the delisting of the companies as of the end of 2023. These companies are entities that have contributed significantly to the economic development of the country through job creation and tax revenue. Their activities helped in driving the backward integration policy of the government, which centered on boosting local sourcing of raw materials by manufacturing companies, especially the consumer goods firms. The small and medium enterprises (SMEs) which keyed into the scheme played active roles in the value chain process.
The scenario is compounded by the rapid decline in capital importation in Nigeria, which dipped by 89.6 percent in four years from $5.8 billion in Q1 2020 to $645 million in Q3 2023, according to the National Bureau of Statistics (NBS).
These perceptions of the interviewed business elite match the reaction of the Chairman of the House of Representatives Committee on Petroleum Resources, Downstream, Ikenga Imo Ugochinyere.
He said at the weekend that the raid carried out on Dangote Group was capable of worsening the economic situation in the country and scaring investors away.
He said, “I’m of the view that the timing of the raid on Dangote Group is not only very suspicious, but most importantly capable of worsening the economic situation in the country and scaring away investors. In the last few months, our nation has lost so many foreign investors.”
REAL SOURCE OF UNEASE IN THE BUSINESS COMMUNITY
Particularly alarming to the business community is the apparent lack of synergy between the government agencies investigating the same allegations, the Department of State Security, DSS, and the EFCC, as well as the Presidential Special Investigator. They are all conducting the same investigation independently, thereby causing unease and uncertainty among captains of industry and businesses in the country, THEWILL can report authoritatively.
On June 12, 2023, the DSS said it had arrested Emefiele “for some investigative reasons,” after accusing him of terrorism financing and economic crimes. However, on October 27, the DSS handed the former CBN governor to the EFCC after the Federal Government withdrew a two-count charge against him and the Federal High Court in Lagos granted him bail. The anti-graft agency started a fresh probe.
While these legal fireworks were going on and the DSS and EFCC tangoed over the statutory right to investigate Emefiele, President Tinubu on July 29, 2023 appointed Jim Obazee as Special Investigator to “investigate the CBN and related entities,” and report directly to him.
In fact, THEWILL checks confirmed why there is uncertainty in the business community. For instance, this newspaper learnt that when Obazee constituted his investigating committee, only the police and DSS joined the team. The EFCC declined to enlist its investigators. But a few weeks after Obazee’s initial report was leaked to the media, the EFCC made a U-turn and asked to join but their request was declined. The agency then decided to start its own investigation, raiding premises of companies. So, while Obazee reports to the president, the EFCC is doing an open investigation, independent of what the Special Investigator is doing. “No one knows when these multiple investigations will end and where it leads to,” a source with knowledge of development told THEWILL anonymously.
THE POOR ROAD TRAVELLED
The ongoing inquisition and raids have once again raised the question about the way private and publicly quoted businesses are treated in the country. A brief account of subsequent governments’ business growth plans, as one of THEWILL respondents pointed out, shows how the economy has undergone reforms that have left it poorer and a continued disincentive to many otherwise potential entrepreneurs and investors.
At a point in time, the Federal Government introduced the privatisation policy to liberalise and grow the economy, but many of the companies bought by Nigerians ended up being closed down.
Examples abound with public enterprises like Osogbo Rolling Mills, Daily Times Newspaper, Jebba Paper Mills, Bacita Sugar Factory and some commercial banks. But buyers ended up looting the assets of these companies instead of reviving them.
Even those that were completely liquidated without any legal justification, such as Nigeria Airways and Nigerian Shipping Lines, or put under receivership with creations like the Asset Management Corporation of Nigeria (AMCON), which was set up to collect loans owed banks, have failed.
Airlines like Aero Contractors, Arik Airline, NITEL, 9Mobile or banks like Union Bank, Keystone Bank and Polaris Bank, are shadows of their once lucrative business selves.
About the Author
Amos Esele is the Deputy Editor of THEWILL Newspaper. He has over two decades of experience on the job.
