- Category: Ephraim Emeka Ugwuonye Esq.
- Published on Tuesday, 26 June 2012 14:34
- Written by Emeka Ugwuonye, Esquire
In a desperate bid to stave off what is a fast gathering storm of scandals, the Embassy of Nigeria engaged an online reporter, Emmanuel Asiwe, and his Huhuonline for a cash-and-carry damage control. Don’t get me wrong: It is not a problem to pay to salvage image or a brush-up. And it is not dishonorable to engage in the business of
helping a damaged person or entity to save face. Therefore, neither Ambassador Adefuye nor Huhuonline has done anything wrong just because one hired the other to help clean up a bloody mess. But that is if it ended there. What happened last weekend between the Embassy of Nigeria and Huhuonline clearly went far beyond. The report written by Huhuonline and which was celebrated for a brief period by Ambassador’s friends yesterday looks like an attempt to cover up. I was forced to analyze that report.
Before I go any further, let there be a fully disclosure. On Wednesday, June 20, the publisher of huhuonline called me on the phone and we chatted a bit about the Nigerian Embassy palaver. On his second call the same day, I told him I would call him back and I did call him back. We chatted for about 5 minutes and I forwarded to him an email in which I had made certain comments on the subject matter.
On Thursday, June 21, he called me again and spoke for about 5 minutes the first time and about 3 minutes the second time. I realized that he was interested in doing a story on the Nigeria Embassy and its banking problems. I admitted to him that I had information about some of the things going on in the Embassy at present time. There was no implication for confidentiality or privileged information in all this. The gentleman was polite and intelligent. On his second call, he indicated to me that he was coming to Washington on Friday, June 22 on the invitation of Ambassador Adefuye. (There is nothing wrong there. He has right to interview anybody he likes).
From my conversation with the Publisher of Huhuonline by Thursday evening, I could estimate how much he knew generally and specifically on the subject matter in issue. Though probably an intelligent person, I did not think he knew much about the way embassies work, and particularly how Nigerian Embassy works. He was curious, but on a scale of 1 to 10, I would rate his manifested familiarity with the subject matter as of Thursday at 5.
I sensed that Ambassador Adefuye had invited him to Washington in order for him to tell his side of the story. It is not an abnormal thing for a person in his position to do so. I also know that Nigerian government officials have several secrets for the simple fact that the entire system of our government thrives in secrecy. Indeed, out cultures thrive in secrecy. For instance, a parent is not to announce the number of children she has to avoid alerting the spirits and no one announces his age or wealth for some other cultural reasons. Our government operates with that mindset. Things are not transparent. Indeed, Nigerian Government officials instinctively hide things they are not supposed to hide. Example, EFCC officer hides his name, when elsewhere in the world, officers wear their name tags on their left chests.
It was clear to me that if the Ambassador of Nigeria invited an online journalist from over 400 miles to his home or office, I can swear that it is not for an open discussion. Ambassador Adefuye would not invite Huhuonline unless there were assurances of a deal. It just doesn't make sense. They suspect all outsiders unless someone deeply embedded within could vouch for you or unless some bribe money is in on the table to guarantee trust and cooperation.
I don't know exactly when the publisher of Huhuonline got to Washington on Friday. But even if he got to Washington Friday morning, the time was not sufficient to move him from his knowledge level on Thursday night to the expert he appeared to have become on Monday morning when he published the new version of his story on these matters. It was a big learning curve for a researcher however skilled to traverse within such a short period, given several specific factual assertions and sweeping conclusions in the report. In any event, given the range of the information that Huhuonline throws about as of Monday (today), they could not have been sourced all within Friday.
Okay, the most logical information gathering exercise that huhu publisher did was to get the documents that Adefuye gave him or showed him. Consider this: (a) M & T Bank, indeed none of the banks, would not give huhu publisher information about its client. So virtually all the things that huhuonline claims to have learned from M 7 T Bank has to not be true as for source (b) If the accounts in M & T were closed in March as huhuonline claimed, it means that the bank would not be providing any account information to huhuonline or anybody on June 22, (c) nobody really would give huhuonline confidential information about Embassy account to huhuonline under any circumstance. There are clearly designated officers of the Embassy who would be able to obtain information on the accounts. Ambassador's secretary that serves tea each day the bank officials visits would not be able to get the information.
Now let's get to specifics: Sunday evening, by 7pm, huhu publisher called me on the phone. He tried to impress upon me certain versions of the truth. I noticed a remarkable improvement from asking questions on Thursday night about the Embassy affairs and educating me on Sunday night about Embassy Affairs. From experience, I laughed quietly. He was persuading me to a viewpoint, except that the issues at stake are things I had known personally based on particular and detailed experiences, not a research conducted in one weekend.
When I speak about Nigerian Embassy or Nigerian Government, despite the heated nature of the subject matter, I always have to balance between information that is confidential and information that is not. I have not been a lawyer to the Embassy since the past 3 years, which was before Adefuye came to Washington. So, nearly everything concerning Adefuye in Washington is unaffected by my confidentiality obligations. I was able to inform huhu publisher that the Ambassador withdrew one million dollars in cash in one week last week of February or first week of March of this year. That's not confidential information, but it is true.
When huhu publisher spoke to me on Sunday night, he was quick to tell me that he tried to confirm the one million withdrawal but could not do so. I asked him how he tried to confirm it. He said he asked an M & T bankers. And the man said he didn't know whether that happened or not. There are four problems with this, but I pointed out only one. The problems are: (a) Huhuonline did not have time to meet with any M & T bank official if he arrived here on Friday and met with the Ambassador. The bank is downtown DC and far away from the Embassy in heavy downtown traffic, unless he drove to the bank with Ambassador and they were talking as they drove, which is unlikely (b) the Ambassador would never leave huhu publisher open and unguarded access to the Embassy banker because huhuonline might learn more that the Ambassador wanted them to know, (c) the accounts were already closed 3 months earlier and the bankers would not be talking about an account that has been closed, (d) if the banker who was giving him information told him that he could not confirm that one million was withdrawn in cash three to four months ago, that means that the banker just didn't want to own to why the accounts were closed three months ago, because such cash withdrawal would stand out in unusualness that every banker would remember it for years and if it didn't happen every banker would say: "hell no" when asked the question.
CONCLUSION: On Sunday, I asked huhu publisher the following questions as a true test of a transparent and open investigation: (a) How much were the balances on the Embassy accounts in January, February, March, April? Huhuonline could not answer that question. That means that huhuonline cannot address the question of money laundering and movement of funds into and out of those accounts. (b) When exactly did the Embassy migrate its accounts from M & T Bank to Citi Bank? Huhuonline does not know. (c) How much was the balance on the account since it moved to Citi or now? Huhuonline does not know. It really means that Huhuonline was never given the information to enable them answer the only question Nigerians are interested in. What happened was that the Ambassador and his friends had googled up general information about banking problems in their most generic form and handed the print out of such googled generalities to huhuonline and they called it investigative report.
Finally why is it that only Citi Bank would accept the Nigerian Embassy accounts? The reason is simple. Because Citi has branches in Nigeria, it is in a much better position to monitor the sources of the funds moving from Nigeria to the Embassy account. It means that M & T Bank realized that monies were moving from the wrong sources in Nigeria into the Embassy account in Washington. They do not have the ability to verify the stories the Embassy is giving them as to the sources of those funds. And they don't trust that the Embassy of Nigeria is telling them the truth. So, Citi, please take over because you are in a position to figure what the hell is going in that terrible place. The truth of the matter is different than what the Ambassador wants to feed you. Huhuonline's report is actually a miserable attempt to package a bad situation. But I appreciate their effort and their good luck in being chosen by Ambassador to launder the image of his Embassy.
For a more detailed treatment of Huhuonline Report, I examined the points of huhuonline: I paste their argument and interspacing it with my comments as follows:
Revealed! Why Nigerian Embassy Accounts Were Closed
Against the backdrop of media report that Nigerian Embassy bank accounts with Bank of America and Wells Fargo were frozen. Huhuonline.com can disclose that Nigerian Embassy, which has offices in Atlanta, New York and Washington DC, operated six different accounts, until March 31st 2012 with Manufacturers and Traders Trust Bank (M&T Bank). Our checks reveal that exiting of banking relations with Embassies is not specific to Nigeria and that Nigerian Embassy did not operate bank accounts with Bank of America (BOA) and Wells Fargo Bank NA.
UGWUONYE’S COMMENT: The media report referred to above includes the story published by huhuonline and relayed by Leadership Newspapers, which stated that the Embassy had accounts in Bank of America and Wells Fargo. Question: Upon what research did Huhuonline base that report, which it now discredits and cleverly tries to attribute to other media? Let's forget the conclusions in the above paragraph and hope that they would supply basis for them below.
HUHU: Our findings reveal that US banks, such as JP Morgan Chase, which has a huge diplomatic clientele as it had a branch at the UN Headquarters in New York, has closed all embassy accounts. Even permanent members of the UN Security Council like France and China were among the countries that were told by JP Morgan to close their account by March 31st 2012.
UGWUONYE’S COMMENT: The above is again conclusory and has no substantiation whatsoever, especially because huhuonline has changed its story on this topic. The question is not the various possible reasons why a bank may close accounts of clients. Rather, the question is specific: why did M & T Bank with very long relationship with Nigerian Embassy close the Nigerian Embassy accounts unceremoniously?
HUHU: Further, in 2011, Bank of America closed five accounts held by Angola embassy and several other banks have told US authorities they plan to get out of the diplomatic business, the Washington Post reported.
UGWUONYE’S COMMENT: The above assertion is also very vague. What it does is to assume that there is only one reason for banks to close their client’s accounts. So, if Bank of America had a reason to close Angola's Embassy account, that must be the same reason why M & T Bank closed Nigerian Embassy account. Not even in death would people die of the same cause. Some die of heart attack and some die of plane crash. Bank of America could close Angolan Embassy account because it is not profitable for them while M & T Bank closes Nigerian Embassy or any other account for a totally different reason. So, the Angolan Embassy example does not answer the Nigerian question. Maybe it will as we go down. So let's be patient.
HUHU: Besides Angola, other countries like Ivory Coast, Yemen, Nepal, Republic of the Congo, Sudan have all had their embassy accounts closed in recent years. Nigeria is just another country that has fallen prey to banks shedding their focus on their noncore but high risk business.
UGWUONYE’S COMMENT: This assertion is again dubious and a white wash. The use of the phrase "in recent years" is meaningless because it could be 10 years ago or 5 years ago. Sovereign banking is not viewed so disfavorably by banks as huhuonline makes it to be. Rather, banks like to deal with sovereign customers because of the positive business externalities such relationship gets for them. Any American business knows that doing business with a foreign Embassy is the quickest way to get access to other government businesses in the country in question. If an American bank has oil and gas customers, such bank's access to Nigerian Embassy could open opportunities for the bank to introduce its customer to Nigerian Government. From social stand point, American bankers and other business leaders are actually eager to mingle with foreign diplomats. But huhuonline gives the impression that American banks were viewing their sovereign clients with diminishing interest. That is a spin one round too fast.
HUHU: For the Nepalese mission to the U.N., the push and pull means finding a new bank for the second time in as many years. The U.S. "is the worst country to…open an account in," said Dilli Acharya, third secretary for Nepal's mission to the United Nations. WSJ reported.
UGWUONYE’S COMMENT; I am disturbed by the tendency of huhuonline to lump all countries and all embassies in one category. What is the essence of comparing Nigeria, with Nepal and Ivory Coast in terms of potentials for banking business? Besides, if we were to accept the reasoning of huhuonline, we must then conclude that the Embassies are now shot out of the banking system. But actually, you will later read huhuonline to be saying that the Embassy moved to another bank. Are those other banks not part of the American banking system? How could you make a general argument about banks and still end up with the Embassy still banking somewhere?
HUHU: According to John Lane, chief executive of Congressional Bank, the banking subsidiary of Congressional Bancshares Inc. in Betesda, Md;“the issue is "created by the U.S. government and needs to be resolved by the U.S. government.” He said he "can't stand the heat" from regulators, and has closed two embassy accounts within the last six months. But refused to identify the embassies.
UGWUONYE’S COMMENT: This again is a general argument that does not say anything. It could mean that the American regulators are now less tolerant of abuses or money laundering. That does not mean that abuse did not occur. The effort is to get to the specific reasons for closing our Embassy accounts. The statement quoted above could have been valid at any other time in banking history. it does not explain why the Embassy account closed in March of 2012 rather than in March of 2011 or 2010, etc. The question is what happened to the Embassy accounts.
HUHU: Robert Rowe, the vice president of the American Bankers Association (ABA), the main representative group for US banks, blamed growing regulatory pressure clamp down on corruption and criminal activity. “Because of requirements from government examiners, the banks are being particularly careful” about money arriving from Abroad especially African countries with High profile individuals(Boko Haram). “There is a lot of careful scrutiny now” he said “ it is getting very difficult to tell the good guys from the bad guys”
UGWUONYE’S COMMENT; Okay, let's not jump into conclusion and say: "yeah here they finally got it" because they made reference to corruption and criminal activity as equally valid causes for closing Embassy accounts. Let us just acknowledge that these admissions make it unreasonable to say that Nigeria Embassy accounts were necessarily closed by M & T Bank for the same reasons that Bank of America closed Ivorian Embassy's account. So, it takes us from the huhuonline's conclusion that all was okay to the possibility that all was bad - corruption, boko haram, criminal activities. So, let withhold judgment yet.
Huhuonline.com gathered that JP Morgan Chase sent a letter to ambassadors in the United States on September 30th 2011 warning that all diplomatic accounts and credit cards will be closed by March 31st 2012.
UGWUONYE’S COMMENT; The above assertion is value neutral as far as the search for truth is concerned. One has to take huhuonline as an article of faith to believe it's claim that it "gathered". Gathered from where and what sources? Was Ambassador Adefuye the source?
Notice of Termination:
In the same vein, M&T Bank in a letter dated January 3rd 2012, and authored by Peter Senica, Vice President Manager, Embassy Banking, said, that it was exiting banking relationship with the Nigerian embassy, and advised the embassy to close its account by March 31st 2012.
The Letter which was obtained exclusively byhuhuonline.com, reads,
“I am writing to advice you that M&T Bank is exiting the relationship with your Embassy effective March 31st, 2012. We recommend that a new account relationship be opened with another financial institution before March 31st 2012 and that you begin using their services once established.
“In order to ensure a seamless transition of your day to day business we suggest that your M&T account be close by you before March 31st deadline since items and checks presented by for payment after that date will be returned unpaid.”
“If your account remains open after March 31st 2012 M&T Bank will mail a check to your attention for the remaining account balances minus any service charges if any.”
“Any direct deposit or automatic debits for the accounts will not be accepted after March 31st ,2012, so you should discontinue these arrangements with your depositors/creditors accordingly.”
UGWUONYE’S COMMENT: When huhu publisher told me about this letter on Sunday, I asked the following questions or made the following observations. (a) who gave you the letter (the Ambassador), (b) Apart from this letter, do you have access to the full range of correspondence between the bank and the Embassy? Do you know for instance, how the Embassy responded initially to the letter? (c) this letter actually defeated most of the argument of huhuonline that they knew the reason for the closure of the M & T Bank accounts because the letter did not disclose the reason; It is totally silent on the reason and that means that reason is not good. It is like when you fire a sensitive staff. This letter is perfectly the same type of letter banks have sent to me in connection which clients they felt defrauded them or is engaged in shady business. How did huhuonline expect the letter to be if the reason was that the bank suspected Nigerian Embassy of money laundering? This is exactly how the letter should look. If it was due to regulatory challenges, the letter would have stated any positive reasons.
I think there is no need to continue the analysis. The conclusion is evident. Why is it that only Citi Bank would accept the Nigerian Embassy accounts?