*NIMASA Acted in Line with Directives, Followed Due Process

The National Assembly has issued a warrant of arrest on the Director General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Dr. Bashir Jamoh over the alleged payment of $5 million to a legal firm as professional fee for the recovery of $9.3 billion loss by the apex maritime regulatory authority.

The warrant of arrest was issued following the refusal of Jamoh to appear before the upper chamber of the National Assembly to explain how the agency allegedly paid $5 million to a legal firm as professional fee for the recovery of $9.3 billion loss.

The National Assembly made the startling discovery through its Senate Committee on Public Account which has Senator Matthew Urhogbide.as its Chairman.

Maritime Bits learnt that the $5 million which is five per cent of the amount agreed was paid for what impeccable sources called “intelligence-based tracking of global movement of Nigeria’s hydro-carbon and recovery of loss” by the Federal Government to the tune of $9.3 billion between 2013 and 2014.

Apparently displeased by the failure of Jamoh to appear before the committee, Urhogbide stated that the National Assembly has no other option than to issue the warrant of arrest on the NIMASA Director General.

His words: “We have invited NIMASA up to three times but its officials failed to honour our invitations. They can come to the National Assembly for the appropriation of fund but when it is time to give account, they will be nowhere to be found. The committee had invited NIMASA up to three times for the explanation on the payment of $5 million as professional fee and details of $9.3 billion loss by the Federal Government, but the agency declined the invitation.”

Urhogbide averred that the Senate Committee on Public Accounts has no other option than to issue warrant of arrest against Jamoh.

Continuing, the legislator said: “Audit observed that the agency engaged the service of a legal firm through a letter with reference number NIMASA/DG/KP/2014/001dated 24th January 2014 for the intelligence based tracking of global movement of Nigeria’s hydro-carbon and recovery of loss by the Federal Government of Nigeria in the sum of USD9.3billion between 2013 and 2014 with a start-off cost of $5 million and 5 percent of all sums recovered. Payment instruction with reference number: NIMASA/2007/DFS/WJ/5.500/VOL.11/341 dated April 2014 showed that the firm was paid the sum of $4,523,809.52 (Four million five hundred and twenty three thousand eight hundred and nine dollar fifty two cents only) net as professional fees from Zenith Bank (UK) Dollar account. The naira equivalent of this amount was N741,904,761.28 at an exchange rate of N164 to a dollar as of that date.

“No evidence of recovery of either part or the entire sum of the 9.3 billion US Dollars was presented as at the time of the periodic check in February 2018, despite the huge amount of money already paid to this effect. It is instructive to note that details of the transaction leading to the loss of $9.3 billion to the Federal Government which only came to audit attention through the review of the letter from the agency to the legal firm so as to ascertain what could have transpired, resulting in such a huge loss were not presented for audit. Ordinarily, the firm should have deducted its fees from the amounts recovered for the Federal Government and not receive fees in advance in lieu of the recoveries.

“Audit is concerned that payments was made for service not rendered and this may be a deliberate attempt to divert government funds for personal use. The Director-General is required to justify the payment for service not rendered, failing which the sum of N741,904,761.28 should be recovered from the legal firm and paid into the CRF, forwarding evidence of payment to the Public Account Committees of the National Assembly and to the Office of Auditor-General for the Federation for verification. Sanctions stated in FR 3104 should apply. He is also required to provide details of the transaction(s) leading to the loss of 9.3 Billion US Dollars for thorough scrutiny.”

Meanwhile, NIMASA has stated that it acted in line with directives from Presidency and the Attorney General of the Federation in the disbursement of the $5 million to the legal firm that was given the job.

According to it, following a steady decline in its hydrocarbon exports revenue due to ineffective monitoring, the Office of the Attorney General of the Federation had on the directive of the Presidency, directed it to institute legal action against the affected international oil companies (IOCs) which were involved both in under declaration and under remittance of crude oil exports.

Quoting from several memos, an official of the agency who preferred anonymity told Maritime Bits that NIMASA upon the strength of the said approval on January 29, 2014 hired a consortium of five legal firms based in the United States of America (USA) to handle the brief.

One of the official memos from NIMASA on the controversy surrounding the engagement of the legal team and the circumstances under which an initial fee of $5 million was disbursed explained that “government of Nigeria had consistently recorded a decline in its hydrocarbon exports revenue due to ineffective monitoring of hydrocarbon shipments by the International Oil Companies (IOCs). Consequently, the Federal Government became interested in tracking the global movement of Nigeria’s hydrocarbon and recover lost revenue”.

According to the official, sometime in 2013, the Attorney General of the Federation and Minister of Justice by a letter dated 29th November 2013, conveyed to NIMASA the approval of the President dated 19th November 2013, for the engagement of technical experts and legal team to provide intelligence gathering based tracking of Nigeria’s hydrocarbon and also recover revenue lost by the Federal Government.
The official explained that in furtherance of realizing the objective, the Attorney General of the Federation and Minister of Justice in that letter of 29th November 2013, conveyed to the agency Mr. President’s approval of the appointment of a legal team, retained to provide legal services and representation for and in relation to the intelligence-based tracking and gathering of global movement of Nigeria’s hydrocarbon and recovery of revenue lost by the Federal Government.

“The agency on the 24th day of January 2014 conveyed the approval of the President to the legal team/retained counsel of their collective appointment/engagement as conveyed to the agency by the Attorney General of the Federation and Minister of Justice. The Federal Government represented by the agency by a retainership agreement, retained the services of a legal team comprised five law firms with three Senior Advocates and other lawyers as well as a technical team. The current Attorney-General under his hand increased the legal team to seven law firms to work with the technical team based in Houston, United States of America to prosecute the matters in court. The effective date of the appointment of the legal team was 29th January 2014, covering an initial period of 10 years.

The legal team was paid professional/legal start-off fee of $5,000,000 (NGN741,904,761.28 at an exchange rate of NGN164 to $1 as of the date) which formed part of the legal fees and costs due to the legal team and deductible from the payment due to the legal team/retained counsel upon the conclusion of the project”, the official added. 

According to the official, the Federal Government through NIMASA and the Office of the Attorney-General of the Federation is being provided with periodic updates on these matters and NIMASA is also closely monitoring the proceedings which the agency said have so far been satisfactory.