Nigeria’s anti-corruption police hunted the debtors of five banks rescued in a $2.6 billion (R20.4 billion) bailout, while the head of one of them turned herself in three days after being declared wanted.
Five teams from the Economic and Financial Crimes Commission (EFCC) sought defaulters who had not paid up despite the expiry of a deadline. The agency says some debtors obtained loans under false pretences and may have been laundering money.
“Each of the teams has a mandate to arrest a minimum of 10 defaulters. They are still out on the trail,” EFCC spokesperson Femi Babafemi said, adding it was too early to tell how many arrests would actually be made.
“It is not as if the defaulters are sitting waiting for them,” he said.
The central bank injected $2.6 billion into Afribank, Finbank, Intercontinental Bank, Oceanic Bank and Union Bank on August 14 and sacked their senior management, saying lax governance had left them so weakly capitalised that they posed a systemic risk, Reuters reports.
Last week it published a list of what it said were their defaulting debtors, including some of Nigeria’s most powerful tycoons, who it said owed 747 billion naira (R38 billion).
Cecilia Ibru, the former chief executive of Oceanic Bank and one of the highest-profile executives to have been involved in the crisis, turned herself in to the EFCC for questioning yesterday, Babafemi said.
The agency, which has detained 15 executives from the five banks for questioning, declared her wanted last week in connection with fraud, insider trading and money laundering.
Erastus Akingbola, former chief executive of Intercontinental Bank, is now the only one of the five bank chiefs not to have been detained.
He was declared wanted at the same time as Ibru, but local newspaper reports have said he has left the country.
The drive to clean up the banking system by new Central Bank Governor Lamido Sanusi has the full support of President Umaru Yar’Adua, the presidency said.
“The central bank has the full backing of Mr President in all its actions in the banking sector and he is happy that the EFCC is carrying out his directive to recover the huge debt owed the banks,” Yar’Adua’s spokesman Segun Adeniyi said.
Analysts say criminal charges could be brought if bank executives are found to have falsified accounts or breached share price manipulation rules by setting up subsidiaries as vehicles to trade their own stock and push up the share price.
The EFCC has said some of the loans were sought using false names, disbursed without approval from the boards of the banks, and in some cases diverted to ventures other than those for which they had been sought.
It has said some defaulters could be prosecuted as conspirators with the banking executives.
The EFCC has flown 100 additional agents backed up by two units of mobile police to the commercial hub Lagos to help recover the bad loans. But some of those accused of defaulting have challenged their inclusion on the central bank’s list.
Those listed as directors and shareholders in some of the defaulting companies read like a Who’s Who of Nigeria’s business aristocracy, including the only two Nigerians on the latest Forbes billionaires list, Aliko Dangote and Femi Otedola.
Dangote has denied holding non-performing loans, as has Ndi Okereke-Onyiuke, the director-general of the Nigerian Stock Exchange, who is also chairman of the board of conglomerate Transcorp.