Startling Revelations On Alleged N381bn Arms Fraud

Startling Revelations On Alleged N381bn Arms Fraud
July 16 04:46 2016 Print This Article

More details have been revealed on the alleged defence equipment procurement in the Nigerian Armed Forces from 2007 to 2015.

According to the highlights of the third interim report released by the Committee on Audit of Defence Equipment Procurement (CADEP) in the Nigerian Armed Forces, a total amount spent for procurement and operations within the period under review were N185,843,052,564.30 and $685,349,692.49.

According to the committee, “The ONSA on 13 May 2013 requested funds for the conduct of Operation BOYONA aimed at dislodging terrorist camps along the common borders with Cameroun, Chad and Niger. Consequently, the government released N1,340,000,000.00 from the Ministry of Foreign Affairs which were disbursed to DHQ and the Services accordingly. In August 2013, ONSA requested and got approval for additional N2,000,000,000.00 for logistics requirements and sustenance of troops, which was credited to ONSA’s account. However, DHQ and the Services confirmed non receipt of any additional funds for Operation BOYONA. The Committee is of the view that the then NSA, Lt Col MS Dasuki (rtd) should be made to account for the N2,000,000,000.00.”

The Committee so far noted that within the period under review, the sum of N71,775,313,451.30 and $685,349,692.49 were spent on Nigerian Army procurement by the Ministries of Defence, Finance, Foreign Affairs and Environment. Others were NNPC, CBN and the Office of the National Security Adviser (ONSA). Additionally, some state governments, notably Adamawa, Kano and Yobe as well as Federal Ministries of Finance and Power, funded Nigerian Army operations with the sum of N114,067,739,113.00. The contributions made by other states such as Borno, Plateau among others were not available as at the time of writing this report.

Besides, it recommended investigation of two former Chiefs of Army Staff (COAS), Lt.-Gen Azubuike Ihejirika and Lt.-Gen. Kenneth Minimah; a former minister of state for Foreign Affairs II, Dr Nurudeen Mohammed and three former permanent secretaries in the Ministry of Defence – Mr. Bukar Goni Aji, Mr. Haruna Sanusi and Me. E.O, Oyemomi for corrupt practices.?They were indicted by the committee set up to investigate procurement of arms to fight insurgency in the North East.?The committee, in its report, said N381 billion was expended without any procurement to show for the expenditure.?In the Air Vice Marshall Jon Ode (retd) committee report, it was discovered that a contract worth N169,916,849.77 for the procurement of 53 Armoured Vehicles Spare Parts, which had 90 days completion time, is yet to be completed, five years after.?Besides, in its investigation, the committee said it discovered that the total amount spent for procurement and operations between 2007-2015 were N185,843,052,564.30 and $685,349,692.49.?The committee also said in its report that most of the procurement lacked due process.?On the heels of the committee’s recommendation, President Muhammadu Buhari has approved further investigation of those involved, after the committee found a number of irregularities in the contract awards.?Among those to be investigated are 18 serving and retired military personnel, 12 serving and retired public officials and 24 Chief Executive Officers of companies (CEOs) involved in the procurement.?All were either accounting officers or played key roles in the Nigerian Army procurement activities during the period under review.?Those listed, according to the committee, for further investigation include Ihejirika, and Minimah; Mohammed and three former permanent secretaries in the Ministry of Defence – Mr. Bukar Goni Aji, Mr. Haruna Sanusi and Me. E.O, Oyemomi.?Also, CEOs to be investigated include Col. Olu Bamgbose (retd) of Bamverde Ltd; Mr. Amity Sade of Doiyatec Comms Ltd and DYI Global Services and Mr. Edward Churchill of Westgate Global Trust Ltd.?The committee found that the army contracts awarded by the Ministry of Defence for the period under review were often awarded without “significant input from end-user (Nigerian Army) and to vendors who lacked the necessary technical competence.”?‘’As an example, three contracts, with a total value of N5,940,000,000.00 were awarded to DYI Global Services Ltd and Doiyatec Comms Nig. Ltd (owned by the same individuals) for the procurement of military hardware including 20 units of KM-38 Twin Hull Boats and 6 Units of 4X4 Ambulances fitted with radios.?The committee found that the two companies collected N5,103,500,000.00, representing 86% of the total value of the 3 contracts worth N5,940,000,000.00, but only performed to the tune of N2,992,183,705.31,’’ the report said.?With respect to contracts awarded directly by the Army, the committee found that many of the contracts were characterised by ‘’lack of due process, in breach of extant procurement regulations and tainted by corrupt practices.?‘’In this regard, a review of the procurement carried out by Chok Ventures Ltd and Integrated Equipment Services Ltd established that between March 2011 and December 2013, the two companies exclusively procured various types of Toyota and Mitsubishi vehicles worth over N3,000,000,000.0 for the army without any competitive bidding.?“Though the committee found no credible evidence of delivery of the vehicles, the vendors were fully paid based on job completion certificate authenticated by the then Chief of Logistics.?Also, analysis of the various bank accounts of the two companies showed transfers to individuals related to then Chief of Army Staff,’’ the report indicated.

According to the report “The Committee discovered that suspicious transactions to the tune of N845,600,000.00 and $3,450,619.00 were made from DICON’s domiciliary and Naira accounts with Fidelity Bank. Out of this amount, the then DG DICON`, Maj Gen ER Chioba (rtd), personally withdrew N81,000,000.00 and $131,740.00 in cash from the accounts. The sums of N764,600,000.00 and $3,318,879.17 were also transferred to the accounts of Lava Trade Ltd, 7×7 Ltd and Oranto Petroleum Ltd. The explanations offered by Maj Gen ER Chioba (rtd) that the transfers were payments of services and foreign exchange were unconvincing as there was no evidence of formal business relationship between DICON and these companies. Consequently, the Committee opines that the poor procurement process associated with DICON contracts contravened financial regulations, encouraged illegal withdrawals leading to wastage of public funds, diminished capacity of the Nigerian Army in the campaign against terror and served as a conduit for misappropriation of entrusted funds. The Committee is of the view that Lt Gen OA Ihejirika (rtd), Lt Gen KTJ Minimah (rtd), Maj Gen AI Muraina, Maj Gen U Buzugbe (rtd) and Maj Gen ER Chioba (rtd) are to be held accountable.”

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