Looting bank depositors’ money ~ by Olusegun Adeniyi
Two years after the 2004 consolidation exercise that saw to the emergence of 25 banks in Nigeria, I approached the then Central Bank of Nigeria (CBN), Prof Chukwuma Soludo, about publishing a book on the banking industry.
The idea included extensive interview sessions with Soludo whose consolidation exercise saved the banking industry from imminent collapse. He agreed to my proposition and an interview eventually held for about four hours in London.
Although I can no longer find either the tape or the transcript of that interview, one of the stories Soludo told me was that of the owner of one of the banks that could not meet the N25 billion recapitalization threshold at the time.
The man, according to Soludo, would visit the branches of his bank at the close of business every day to ask, ‘How much did you make today?’ in reference to deposits from customers!
I recall that episode (and some of the insights Soludo shared with me) on Monday when a video surfaced on social media of the staff of a bank that had besieged the house of a Senator to entertain themselves in the name of loan recovery.
Aside the fact that banking is being debased by recourse to such a primitive way of recovering loans, questions must be asked about how the Senator, and many others like him, are awarded jumbo loans without the requisite collateral to fall back on in cases of default.
Ordinarily, bankers who give out loans are supposed to measure the risks and guard their interests when considering such applications. But as we have seen over the years in Nigeria, the only time these bankers bother about security is when they are dealing with genuine customers without ‘connection’.
For those people, they impose stringent conditions. For the fat cats, who they are very much aware would not pay back, they never demand any form of security. In most instances because they share the money.
In July 2019, the federal government established a task force comprised of the EFCC, ICPC, NFIU and the Federal Ministry of Justice to recover N5.7 trillion owed to the Assets Management Corporation of Nigeria (AMCON).
Approximately 20 Nigerians account for as much as 60 percent of that amount. Two years after, there is no word from that presidential committee.
I will not be surprised if a majority of that committee members are themselves chronic bank debtors. But there is no way we can tackle this problem unless we restore a measure of sanity to the banks.
As Justice Lateefa Okunnu of the Lagos High Court said last week while sentencing Francis Atuche, a former Managing Director of Bank PHB (now part of Keystone Bank) to six-year imprisonment for defrauding the bank the sum of N25.7 billion, these corporate thieves are dispossessing innocent customers of their money.
Also sentenced to four years’ imprisonment was the former CFO of the bank, Ugo Anyanwu.
“It was a well-planned, well-executed scheme but the bubble burst when the Central Bank of Nigeria (CBN) intervened,” said Justice Okunnu who had earlier in the year similarly convicted former Managing Director of Finbank Plc, Okey Nwosu, and three former directors of the bank for stealing the sum of N10.9 billion.
As the Yoruba people would say, “omo buruku l’ojo ti e” (even the bad guy has his day). With the Failed Banks (Recovery of Debts) and Financial Malpractices in Banks Decree 18 of 1994, the late General Sani Abacha focused on this problem and to a large extent, dealt with it in his own way.
Where the security pledged for a loan is impossible to locate, or where no security is pledged at all, according to the decree, the tribunal would hold the directors, shareholders, managers and other employees of the failed bank liable for granting the loan that had become irrecoverable.
Also liable was “Any director, manager, officer or employee of a bank who knowingly, recklessly, negligently, willfully or otherwise grants, approves the grant, or is otherwise connected with the grant or approval of a loan, advance, guarantee or any other credit facility or financial accommodation to any person without adequate security or collateral.”
I certainly do not suggest a return to the Abacha era, but we cannot continue with the situation in which bank debtors and their corrupt enablers not only shortchange the people but also end up receiving national honours and doctorate degrees from our universities before they end up as ‘his excellency’ or ‘distinguished senators’.
Amina Mohammed @ 60
The Deputy Secretary General of the United Nations (UN), Ms Amina J. Mohammed will be 60 on Sunday, although I am aware of a small event being organised in her honour tomorrow in Abuja.
I had the privilege of working with Mohammed between 2007 and 2010 and very much admired her passion for excellence, desire to serve the public good and rare capacity to make even the most difficult assignment appear easy.
This was most evident when we served together in a small committee (of about ten officials) who met regularly with the late President Umaru Musa Yar’Adua on the Niger Delta Amnesty Programme.
Ms Mohammed believes in the power of endless possibilities and it is evident in her achievements.
From coordinating the Task Force on Gender and Education for the United Nations Millennium Project to being Senior Special Assistant to Presidents Olusegun Obasanjo, Yar’Adua and Goodluck Jonathan on the Millennium Development Goals (MDGs) to becoming Special Adviser to former UN Secretary-General Ban Ki-Moon saddled with the responsibility of crafting the Post-2015 Development Agenda.
Only perhaps those who never knew her would have been surprised when in January 2017 Mohammed was tapped by Antonio Guterres to become the 5th UN Deputy Secretary General. And she has performed so excellently in the job that she was recently appointed for a second term.
Working within the development space, as Ms Mohammed has done for most of her adult life, can be frustrating. But it can also be rewarding, especially for those who make a significant difference in the lives of the most vulnerable people in the society.
This she continues to do. As she marks her 60th birthday, I can only wish her a most wonderful birthday, long life and good health.
• You can follow me on my Twitter handle, @Olusegunverdict and on www.olusegunadeniyi.com