The suspended Governor of the Central Bank of Nigeria (CBN),
Mallam Sanusi Lamido Sanusi, has responded to the various allegations levelled
against him by the Financial Reporting Council of Nigeria (FRC), which were
cited as the reason for his suspension from office on February 19, 2014.
In a 27-page response released yesterday, the suspended
governor also expressed sincere hope that having painstakingly provided
detailed explanation, backed by verifiable documents, President Goodluck
Jonathan would find his explanation satisfactory and “in line with his
(Jonathan’s) adherence to fairness and justice”, revisit and redress the issue
of his suspension.
Furthermore, Sanusi urged the president to apply the same
rationale and rigour to other agencies of the federal government that had had
serious allegations and queries levied against them, “and presume upon them to
provide responses and explanations with the same level of clarity and
transparency”.
He said he was responding to each of the allegations to
enable the general public see that each and every allegation levelled against
the CBN under his leadership was false and unfounded, and that many of the
allegations were malicious and fabricated, having been designed to mislead the
president into believing that the management of the central bank was guilty of
misconduct and recklessness.
He specifically said he was compelled to make public his
responses in the interest of transparency and accountability, adding that he
was never availed of FRC's briefing before the suspension.
“Let me also state that I saw the FRC ‘Briefing Note’ for
the first time when it was attached to the suspension letter. At no time was
this report sent to the CBN either by the president or the FRC for comments or
explanations,” he said.
On the petition written by the former Managing Director/CEO
of the defunct Intercontinental Bank Plc, Mr. Erastus Akingbola, he said it was
a rehash of baseless allegations that the sacked bank MD had been making since
2010, “which apparently he must have been asked to reproduce on February 9, ten
days before the suspension”.
“It is indeed strange that the CBN governor can be suspended
based on allegations written by a man who ran his bank into the ground and
against whom judgment has been obtained in a London court, and who furthermore
is facing criminal prosecution at home for offences including criminal theft,”
he charged.
Sanusi added that a careful examination of the allegations
contained in the FRC briefing note to the president would show that each of the
allegations could easily have been resolved by a simple request for
clarification or more careful review.
“There is no doubt that if the CBN had received the Briefing
Note, which was prepared in June 2013, all the misconceptions,
misrepresentations and erroneous inferences contained therein would have been
cleared," he observed.
Responding seriatim to the 30 allegations, he said the
allegation of weak corporate governance at the CBN on account of the fact that
the Office of the Governor is fused with that of the chairman of CBN’s board of
directors ignores global best practice.
“This allegation ignores the fact that global best practice
is that the governor of the central bank is the chairman of the board of
directors of the central bank. See Annexure A, which shows the composition of
the board of directors of central banks in over 55 different countries,” he pointed
out.
On alleged fraudulent activities and sundry payments of
N38.233 billion in 2011 for the printing of banknotes to the Nigerian Security
Printing and Minting Plc (NSPMP), whereas the entire turnover of NSPMP was
N29.370 billion, he said the expense item of N38.233 billion to NSPMP was made
up as follows: a) N28.738 billion payment to NSPMP in 2011; b) N6.587 billion
accrued liability in 2011 but paid in 2012 when deliveries were received; and
c) N2.829 billion audit adjustment journal entry into the account at the end of
2011 in respect of prepayments to NSPMP.
“Evidently, the difference between the numbers in the
financial statements of CBN and NSPMP is a simple reflection of timing
differences between recognition of expenses by the CBN and income recognition
by the NSPMP, with both entities applying conservative accounting policies,” he
said.
Responding to the fictitious payments to (a) Emirate
Airlines: N0.511 billion which allegedly does not fly local charter in Nigeria;
(b) Wings Airline: N0.425 billion which allegedly is not registered with the
Nigerian Civil Aviation Authority (NCAA); and (c) Associated Airline: N1.025
billion which allegedly did not have a turnover of up to a billion naira in
2011, he said the CBN neither engaged, paid nor claimed to have paid Emirates
Airlines.
Rather, he clarified that the CBN engaged and entered into
an Air Charter Services Agreement with Emirate Touch Aviation Services Limited,
which is a local Nigerian charter service company. He contended that a simple
enquiry by the FRC would have clarified and avoided this misrepresentation.
With respect to Wings Aviation Limited, Sanusi said the CBN
had contracted Wings Aviation Limited, which changed its name to Jedidiah Air
Limited on 21 August 2009, but only notified the CBN of the change on 28
February 2012. Again, he said a simple enquiry by FRC would have made this
clear.
On Associated Airline Limited, he said the CBN did in fact
pay a total of N1.025 billion to Associated Airline Limited and that the CBN
was not responsible for how the company reports its turnover.
On the allegation that the leadership of the CBN was
unconcerned about its investment in the Bank of Industry (BoI) despite not
receiving the share certificates for investments made since September 2007, he
said he duly instructed a reconciliation exercise be carried out by the CBN on
all its investments in parastatals and companies in 2009, adding that the CBN
wrote various letters to BoI requesting its share certificates.
He pointed out, however, that on September 20, 2009, the BoI
wrote to the CBN explaining that the delay in the issuance of the share
certificates was as a result of BoI seeking a concession on the payment of
stamp duties and other statutory fees from the Corporate Affairs Commission
(CAC) and the Federal Inland Revenue Service (FIRS) with respect to the
investment by the CBN and the Federal Ministry of Finance (FMF).
On the charge by FRC that the leadership of the CBN wrote
off loans supposedly made to staff members to the tune of N3.85 billion in
2012, he said the write-off was not made in favour of CBN staff, but rather it
was a CBN board approved write-off as forbearance to Heritage Bank on 17
December, 2010 as part of the process of facilitating its resumption of
business as a regional bank.
His response on CBN's non-compliance with the IFRS
accounting standards in preparing its 2012 financial statements further
indicated that FRC had waived the requirement for the CBN to comply with IFRS
standards in preparing its 2012 financial statements by its letter of exemption
dated February 26, 2013.
Addressing the issue of unlawful expenditure on CBN
intervention projects and donations to universities, Sanusi said the
interventions were part of the central bank's corporate social responsibility
(CSR) initiatives, which fully comply with the CBN Act and were duly approved
by the board.
“It is worth noting that the CSR policy of the CBN is
consistent with the activities of many other central banks of developing
countries including, Bank Negara Malaysia, the Bank of Namibia, the Bank of
Botswana and the Bank of Indonesia,” he said.
The suspended governor also provided detailed accounts on
all the allegations, which were contained in the FRC briefing note to the
president and also attached to his letter of suspension.
In conclusion, Lamido hoped that the president would find
the response satisfactory, and in line with his adherence to fairness and
justice, "revisit and redress the issue of my suspension," adding
that if the CBN had received the briefing note, which he said was prepared in
June 2013, all the misconceptions, misrepresentations and erroneous inferences
contained therein would have been cleared, and the misleading of the president
would have been avoided.
He stressed that the CBN had achieved so much under his
watch and made huge contributions to the Federation Account, while maintaining
macroeconomic stability, adding that before he assumed office at the CBN, the
contribution of the central bank to the Federation Account was N8 billion.
“Based on the 2012 annual accounts, the central bank’s
contribution rose tenfold to N80 billion, while in 2013, our contribution,
based on the audited accounts, was N159 billion.
“It is noteworthy that in the 5 years of my tenure as CBN
governor (2009 – 2013), the CBN has contributed N376 billion to the federal
budget as IGR (Internally Generated Revenue),” he indicated, maintaining that
the record vitiated the claim of financial recklessness/wastefulness levelled
against his leadership at the CBN.
....culled from THISDAY
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