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Maryland-based Lawyer, Emeka Ugwuonye Loses Again, Ordered To Refund Funds He Stole From Nigerian Embassy

Maryland-based lawyer, Emeka Ugwuonye, yesterday suffered another devastating legal defeat as a US District Court ruled that he must refund the $1.55 million that was meant for his clients, the Nigerian embassy in Washington, DC, but which he illegally converted to his personal use. The stolen funds came from tax refunds credited to the Nigerian embassy from real estate transactions. Mr. Ugwuonye had handled part of the transactions in which the embassy sold some of its real estate holdings between 2005 and 2007. When the US government issued a cheque to the embassy to return taxes initially paid for the transactions, Mr. Ugwuonye kept the money instead of passing it on to his clients.  

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Maryland-based lawyer, Emeka Ugwuonye, yesterday suffered another devastating legal defeat as a US District Court ruled that he must refund the $1.55 million that was meant for his clients, the Nigerian embassy in Washington, DC, but which he illegally converted to his personal use. The stolen funds came from tax refunds credited to the Nigerian embassy from real estate transactions. Mr. Ugwuonye had handled part of the transactions in which the embassy sold some of its real estate holdings between 2005 and 2007. When the US government issued a cheque to the embassy to return taxes initially paid for the transactions, Mr. Ugwuonye kept the money instead of passing it on to his clients.  

Saharareporters exclusively revealed the fraud in 2009. In reaction, Mr. Ugwuonye sued the website, claiming defamation. His lawsuit against our website was dismissed last December. He appealed the judgment, but lost again in March, 2013.

Mr. Ugwuonye’s streak of legal losses continued yesterday as Judge Barbara J. Rothstein handed down a default judgment in favor of the embassy. The judge agreed with submissions made by the embassy’s attorneys asking for sanctions against Mr. Ugwuonye for blatantly violating deadlines and ignoring court orders related to the case.

Judge Rothstein also dismissed counterclaims by Mr. Ugwuonye to the effect that his conversion of the embassy’s tax refund was justified because he was allegedly owed unpaid legal fees by the Nigerian government for unrelated legal representation in other cases.

Judge Rothstein ruled that Mr. Ugwuonye failed to prove that he was being owed outstanding legal fees, citing his failure to provide credible proof.

Yesterday’s verdict was the second time Mr. Ugwuonye lost to the embassy in two months. In an earlier ruling, the court had entered a default judgment against Mr. Ugwuonye’s law firm, ECU Associates, which was used in a series of transactions with the embassy.

The embassy’s lawsuit lasted several years largely on account of delays wrought by Mr. Ugwuonye. He had failed to appear in a court-ordered deposition in March, despite the fact that he was duly notified.
 
A legal source knowledgeable about the embassy’s case remarked that Mr. Ugwuonye may have avoided deposition out of fear that he would be questioned under oath to disclose how he disbursed the monies. “Such disclosures could lead to criminal charges in the US,” said the source.

Judge Rothstein was unimpressed by Mr. Ugwuonye’s claim that he had been granted a lien to take the $1.55 million in lieu of debts purportedly owed him by the Nigerian embassy. Instead, the judge stated that Mr. Ugwuonye was only entitled to $77,000 from the recovered fees representing 5% for his attorney fees.

The court ruling also revealed a hitherto unknown reason why the tax bill was incurred in the first place, showing that Mr. Ugwuonye might have knowingly failed to file the necessary paperwork that would have shown that the Nigerian embassy was tax exempt in the real estate transactions. Curiously, after taxes were assessed, Mr. Ugwuonye went back to the embassy and offered to help them recover the withheld tax. In addition, he obtained a power of attorney from then outgoing Ambassador George Obiozor to enable him to endorse the cheque to his law firm.

After cashing the cheque, Mr. Ugwuonye wrote a letter to the embassy notifying them that the cheque had been received and was awaiting clearance at the bank.

While the embassy awaited the funds, Mr. Ugwuonye withdrew monies from the trust account set up for the tax refund. Records indicated that in 2007 he withdrew $500,000 in one day, and steadily depleted the account until it was left with $195. He then wrote to the embassy claiming that he had converted the funds to his use because the Nigerian government was owing him for services he rendered to a former military head of state, Abdulsalami Abubakar regarding a human rights violation case brought against the former dictator by the family of the late MKO Abiola, presumed winner of the June 12, 1993 presidential election.

SaharaReporters later discovered that Mr. Ugwuonye had been paid in full for his representation of the former military head of state. He had been paid from a settlement fund provided by the Nigerian government to settle the case.

The reporting done by Saharareporters led Mr. Ugwuonye to launch a series of libel lawsuits to silence Nigerian citizens who questioned his questionable handling of the embassy’s funds. His four-year lawsuit aimed at silencing SaharaReporters ended last December when a US District Court Judge Peter J. Messitte of Maryland Southern Division ruled that this website’s reporting of the fraud was accurate and without malice.

Even so, Mr. Ugwuonye mobilized a small army of Internet supporters to misrepresent the court ruling, often claiming his plight was due to his ethnicity.
 
When he first lost to the embassy, he claimed that the judge had given a judgment against a law firm that was moribund. In addition to gloating that the ruling against ECU Associates was of no effect since the firm was a dead entity, he also boasted that he expected a favorable ruling regarding his counterclaims. Yesterday's judgment has exposed his hollow claims, said a legal expert.

“First of all, it was foolish of the man to celebrate that the earlier judgment was against his law firm which had folded up,” said the expert. “He should know that you can’t avoid your legal responsibilities simply by declaring your company to be non-existent. Besides, yesterday’s verdict now means that the judge has found Ugwuonye personally liable for the funds he misappropriated. There’s no hiding place for him now. The embassy can go after any of his assets to recover their money.”

In addition to his latest defeat, Mr. Ugwuonye also faces two pending criminal charges in Nigerian courts. One of the cases is related to his embezzlement of the embassy’s funds while the other has to do with the claim from a Nigerian citizen, Sola Adeeyo, that Mr. Ugwuonye stole $94,000 that the Maryland-based lawyer helped recover from a US bank.

Mr. Ugwuonye also faces possible disciplinary actions from the Maryland Attorney Grievance Commission. Bar associations in the US frown upon financial improprieties by attorneys, especially lawyers who misappropriate funds accruing to their clients.

Mr. Ugwuonye’s law practice in the US has practically folded up. A source claimed that the embattled lawyer was slowly relocating to Nigeria to explore the possibility of a legal career there.