In one of the largest financial scandals in recent years, Nigeria’s 36 state governors and Senate President Bukola Saraki pocketed large slices of funds approved by the Federal Government to reimburse states for the excessive deductions charged to them on account of the Paris Club and other international loans.

SaharaReporters learned that the Governors’ Forum received a hefty sum of the funds. Our team of investigators discovered that some of the governors got as much as N400 million, while Mr. Saraki carted away N2.5 billion out of the first batch of payments made to the states.

Investigation showed that the Nigerian Governors’ Forum decided to use phony consultants, who then illegally deducted five per cent of the funds paid to the states. Our team found that the Central Bank of Nigeria (CBN) paid the consultants without informing the Accountant-General of the Federation. Once paid, the consultants forwarded a part of their payment to the individual accounts of the governors, with some governors individually receiving as much as N400 million. Former officials of the Federal Ministry of Finance registered and floated two of the companies, GSCL Limited and Biztrust Limited, that masqueraded as consultants.

One of the sources on the investigation disclosed that Mr. Saraki was paid N2.5 billion through a finance consultancy run by one Mr. Okey Mbonu, a former managing director of Society Generale Bank, a family bank the Sarakis robbed into bankruptcy, the bank later morphed into Heritage Bank. Documents exclusively obtained by SaharaReporters’ investigative team showed that the Nigerian Governors’ Forum received a total of N11,550billion from the sum of N231billion that the Federal Government directed to be paid to states last December.

Last week, agents of the Economic and Financial Crimes Commission (EFCC) investigating the illegal payments and subsequent transfer to governors’ personal accounts arrested Ashishana Okauru, Director-General of the Nigerian Governors’ Forum. An EFCC source told our team that, during interrogation, Mr. Okauru admitted that money was funneled through the Nigerian Governors’ Forum to individual governors. He, however, refused to write a statement.

Two EFCC operatives said Mr. Okauru, a former Director of the Nigerian Finance Intelligence Unit (NFIU), an arm of the EFCC, was treated with great leniency and released. The sources also disclosed that Mr. Okauru’s former colleagues at the EFCC helped to keep news of his arrest secret.

The misappropriated funds arose after an accounting reconciliation indicating that the 36 states were overcharged for payments to the Paris Club. Late last year, all the state governments asked the Federal Government to repay what they were overcharged as external debt service payments between 1995 and 2002. The said funds were paid as first line charge deductions from states’ share of federal allocations. The debt service deductions were in respect of loans taken from the Paris Club, London Club as well as other multilateral loans obtained by the Federal Government and the states.


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