For someone who has never directly eked out a living for himself in his 39 years of existence and is a billionaire, Mohammed Babangida, first son of retired military president, Ibrahim Badamasi Babangida, should arouse some curiosity. For the past few weeks, he has actually been doing just that. From the Economic and Financial Crimes Commission, EFCC, which has been probing the vast Babangida empire, or rather how the patriarch of the family laundered the billions of all shades of currencies Nigerians widely believe he stole from the public treasury while he ruled from August 1985 to August 1993, the former first family has been in the news. By last week, there were indications that the EFCC had completed its investigations on the steal of the century and that its report should be ready soon.
It has always been widely believed that IBB’s management of the nation’s stupendous crude oil revenue from 1985-1993 when he ruled was as tidy as the ruthless manner Ishola Oyenusi, the vicious robber executed in 1972, managed the salaries of WAHUM workers when he and his gang hit the company one bloody morning some 34 years ago. But the retired General has always dared anybody to probe him and declared he would, any time, come out of it cleaner than a whistle. But from what TheNEWS was able to scoop out of EFCC, IBB’s confidence appears headed for the rocks. Details of the EFCC report promise to be most revealing. Expected to be unfurled is how IBB ploughed huge funds, using his sons and other fronts, into investments in the banking, telecommunications and oil sectors, three most lucrative areas that assure him of monumental returns. The EFCC has been particularly digging into the activities of Fruitex International London Limited, FILL, which has a subsidiary, Fruitex Oil Exploration and Production Limited, FOEPL, in Nigeria. FILL began business in 2001 with a share capital of 400,000 pounds sterling. It was registered with number 4216189 to number 53 Marlborough Hill, Flat 4, London NW8 ONG. The two listed directors were Mohammed Babangida and Susan Scott, 49, a London-based British citizen and company secretary. Aminu Babangida was later brought on board as a director in 2005. Another spin-off of the group is understood to be Memfis Investment Company, Egypt. The Marlborough Hill building housing FILL, though held by a solicitor (beneficial owner), Ashley, solicitors at 19-21 Grovesnor Gardens, is actually owned by Beaumont Group Limited, an offshore company registered in Jersey in the Channel Islands. It could, however, not be ascertained before going to press if this building is the same as the one in Northwest London said to have been bought by IBB on 17 December 2004 for 385,000 pounds sterling.
FOEPL, the Nigerian arm which started operations in February 2004, is owned 65 per cent by “Mohammed Ibrahim.” This name is obviously a dilution of the first names of both son and father. The chairman is listed to be Dr. A.B.C. Orjiakor, 46, a surgeon and wealthy Catholic from Ihiala Local Government Area in Anambra State, while Chief Boniface Madubunji, proprietor of the Mabon Group of Companies, is also part owner. The Nigerian address of FOEPL is listed as plot 175A Moshood Olugbani Street, Victoria Island. TheNEWS checks last week showed a vacant property on which was hung a Diya & Fatimilehin’s To Let or Lease signboard. Investigations, however, showed that the building, until a couple of weeks ago, actually accommodated the Ordrec Group of Companies, owned by Orjiakor. The group, which engages in varied businesses as oil services, shipping, oil rigs supply and medicare, includes Ordreco Shipping Services (a subsidiary of Ordrec Holdings Limited also registered in Jersey, Channel Islands), Ordrec Petroleum, Abbey Court Energy Services Ltd, First Aries Petroleum, Zebbrah Energy Ltd, Odfjell Offshore International Ltd, Shabah E & P Company Ltd, Abbey Court Trading Company (registered in London but now dissolved), Amach Security Services Ltd, Berwick Nigeria Ltd, Helko Nigeria Ltd and Helko Marine Services Ltd. The Group has relocated to No. 25, Lugard Road, Ikoyi.
The Babangida family and Orjiakor were said to have been brought together by virtue of an oil well exploration joint venture in Equitorial Guinea. An aide to Orjiakor swore that besides the joint venture that the two, with two others, have to collaborate on to get the job done, there is no business relationship whatsoever between them. Although IBB’s FILL owns substantial interest in Equitorial Guinea’s “Block M” estimated to be worth $8.2 billion, four entities, including the Babangida family, Orjiakor and the Equitorial Guinea government, are understood to have floated a special purpose vehicle, which is believed to be FOEPL, to jointly execute the project due to the huge capital and technical outlay involved, and as is the practice in the oil industry. IBB is understood to be reaping extensively from certain cronies that he awarded oil blocks when he was in power. Such frontmen include Alhaji Aminu Dantata, who floated Express Petroleum and Gas Limited, solely for the purpose of winning an oil block(s) even though he and the company are in no way qualified for the award, and Alhaji Muhammed Indimi, father-in-law to Mohammed Babangida, who owns Oriental Energy Oil Resources. These fronts are labelled in business and government circles as the “idle rich”, because they don’t have to spend a kobo on their OML which they simply pass on to foreign companies to operate, while they collect commissions in millions of dollars. Dantata’s Express, it was gathered, could in no way manage Oil Mining Licence, OML, 108, awarded it by the dictator. He conceded it to CONOCO–Philips, while he sat back to periodically cream off his commissions. In one windfall, Dantata, this magazine learnt, was paid a sum of $200 million.
Orjiakor’s Shebah E & P, run by Joe Attueyi, however, bought off 40 per cent of CONOCO-Phillips shares in 2003 and promptly increased production from 1,900 barrels per day to 5,000 bpd. Shebah also paid Dantata about $28 million in another commission. Commission percentages to Dantata from the two concessionaires, it was understood, are occasionally reviewed upwards, especially as the bpd go up. Shebah had also recently bagged 75 per cent of OPL 280 for which it paid $21 million as signature bonuses. Orjiakor’s Zebbrah also owns OPL 248 and is affiliated to Abbey Court Trading Company which has lifted more than 30 million barrels of crude oil from Nigeria since 2004. For all the cheap money it makes, Dantata’s Express was not known to have paid any signature bonuses on OML 108 when he was given by IBB, neither has it been paying taxes and royalties, even as it has been regularly collecting dues on the revenue generated from there from CONOCO-Philip and Shebah. On 16 August 2006, the federal government slammed a $193 million fine on Express for evading payment of taxes and royalties.
Orjiakor has also been going through his own storm. Last week, he was taken in by the EFCC over what was gathered was a petition sent to the Commission over his business relationship with Dantata. It took the strong intervention of Reverend Father Matthew Hassan Kukah, the credible Catholic intellectual who flew in from Abuja to the EFCC Lagos office to vouch for Orjiakor’s integrity before the businessman could be released. For now, he has been barred from travelling out of the country.
Indimi was mentioned by the Justice Department of the United States of America as benefiting from a $74.3 million loan the US Export-Import Bank gave Nigeria when IBB was in power ostensibly to buy water pumps from MWI Corporation, a Deerfield Beach, USA, water pump manufacturing company owned by J. David Eller, a prominent contributor to the Republican Party and business partner of Jeb Bush, governor of Florida and brother to President George Bush, the US president. A suit filed by the Justice Department against Eller alleged that $28 million of that loan was improperly funnelled to Indimi, who was MWI’s Nigerian agent. Eller’s lawyer, Scherer, confirmed that Indimi did collect $28 million in commissions on the deal but maintained that this was a perfectly legitimate earning. “Who says that 30 per cent is high for commission?” he queried. Robert Purcell , a former vice-president of MWI who initiated the lawsuit, spoke of bribes to Nigerian government officials, especially on one occasion where he and some other MWI officials brought “large quantities of money to the TransCorp Hilton, Abuja, to grease the palms of the officials.
Purcell contended that MWI vastly inflated the price of the product and through gratification, persuaded Nigerian government officials to stridently declare there was dire and urgent need for the water pump. By 1998, many years after they were bought, Purcell said, much of the equipment was rusting away, unused, in Nigeria. Although IBB’s name was not specifically mentioned in the bribe scandal, sources privy to the deal said the retired general can not claim innocence of it. Babangida and Indimi are said to have been close associates long before they became in-laws. From millions of dollars in commissions collected by many associates like Indimi and Dantata on their oil blocs awarded them by IBB and now being operated by the multinationals and powerful local operators, IBB is assured of a tidy sum of fortune Other sectors the EFCC has been beaming its searchlight on in its quest to locate public funds stolen by IBB are telecommunications and banking. Specifically, the Commission has, in the past few weeks been probing Globacom, the second national carrier, SNC, owned by Chief Mike Adenuga. Also visited was Equatorial Trust Bank, ETB, also Adenuga’s property. Adenuga floated ETB and Devcom Bank, which had been collapsed into ETB, as well as Consolidated Oil Nigeria Ltd in the 1980s. Even then, tongues wagged that in these companies, Adenuga and IBB might just have something in common.
Adenuga’s first attempt to add telecoms to his list of lucrative acquisitions when he bid for a GSM licence, alongside MTN and Econet (now Vmobile) in 2001, ended in failure. His CIL was disqualified for inability to meet payment deadline. The talk in some quarters, however, was that CIL was deliberately not licensed because Adenuga was believed to be a front for IBB. Adenuga was, however, successful in his second effort at joining the telecoms league when Globacom was, in 2003, given more than a GSM licence to become the SNC. The speculation that Adenuga could have been fronting for IBB may, however, have been proved right by EFCC’s declaration that Mohammed Babangida owns 24 per cent stake in Globacom, an arrangement that was hitherto not disclosed to the authorities. Adenuga was arrested on 10 July 2006 after, according to the EFCC, he ignored the Commission’s appeal for three months to voluntarily report at its offices on Awolowo Road for questioning. He was later released. About two weeks later, Mohammed Babangida was also picked up by the EFCC for interrogation on his investment in Globacom and other companies belonging to Adenuga. He, too, was later let go. But the passports of the two men were seized to prevent them from leaving the country while investigations continue.
On 19 August 2006, Adenuga resorted to an action that has given some measure of credence to the allegation that he may, indeed, have been a conduit pipe for IBB’s stolen billions. With his international passport locked away in EFCC’s custody, the billionaire businessman fled to Ghana, from where he made good his escape to London.
Current developments present Nigerians an opportunity to know what Babangida did with their money when he was in power, especially the $12 billion reaped from excess oil price. The late economist, Dr. Pius Okigbo, indicted IBB in a report, after a committee he headed inquired into the issue of mismanaging the money. The Okigbo panel, set up in 1994 by his successor, General Abacha, now deceased, came out with “a gross abuse of public trust” judgement. Okigbo stated that, “had these resources of $12.4 billion or even only a significant portion been paid into the external reserves, the impact on the naira/dollar exchange rate today, and the credibility of Nigeria and/or the environment for foreign investment would have been incalculable.” He added that IBB frittered that money on ‘‘what could neither be adjudged genuine projects nor truly regenerative investments.’’ But Babangida quickly dismissed the report, describing Okigbo as a pro-National Democratic Coalition, NADECO, economist who was in a hurry to punish his regime for annulling the June 12 1993 presidential election won by Chief Moshood Kashimawo Abiola who died in detention in his struggle to actualise that mandate.
Another three-year investigation by former footballer, John Fashanu into a $6 billion debt buy-back fraud involving about 200 accounts also detailed how IBB defrauded Nigeria. Report of the investigation was published by Africa Confidential, a newsletter, and the Sunday Times of London. IBB’s tools for the scam were two Americans – Jeffrey Schmidt, who, because of his closeness to Babangida, converted to Islam, and Robert Minton, an international financial expert. As the investigation revealed, some $4.4billion was earmarked for currency stabilisation and debt buy-back, whereas the scheme cost only $2.5 billion. Alhaji Abdulkadir Ahmed, a past Central Bank of Nigeria, CBN, governor, now dead, supervised the arrangement. The CBN and the Nigerian National Petroleum Corporation, NNPC, made funds available for the two men through the Federal Reserve Bank, New York, Morgan Guaranty in the same city and the Bank of International Settlement, Switzerland. Greenland Holdings, incorporated in Panama, helped to channel the funds into different banks in Switzerland and Austria.
For the purchase of the Nigerian debt, Schmidt and Minton allegedly used Growth Management Limited, GML, based in London for the transaction, after which two others, Shamrock Financial and Triolet were formed to throw more concentric circles around the transactions. The EFCC would need the assistance of Fashanu, who claimed then to “have details of account numbers, identities of those involved, dates and times these frauds were perpetrated.” Fahanu revealed that in a letter dated 15 January 1992 signed by Minton, Shamrock Financial Corporation confirmed to the CBN the acquisition of bank debt for an amount of $1.2 billion. Detailed accounting for Greenland Holdings indicated the purchase of debts from March 1988 to December 1991 for more than one billion dollars. There was a list of owners of the debts, from whom they were bought, “the nominal value as well as the cost to Greenland, which represents on each case between 25 per cent and 45 per cent of their nominal value.”
Most of the debts were actually obtained at very low prices and the stated ‘Cost to Greenland’ provided by Minton to the CBN was false, because, as Fashanu stated, “the records of intermediary banks or Debt Traders permit to establish the insider trading escalated the price and increased undisclosed fees and commissions.” Minton, thereafter, deposited the diverted funds into different coded accounts, opened by him and his wife.
One Jozef Bicaco from Turkey but resident in Geneva allegedly introduced Minton to Discount Bank and Trust Company in the city; the account there was operated by Minton and his wife. Those managing the account were M. Albert Cezama, sub-director, and M.Nessim Habib, an associate director who also administered Minto’s Karosa Foundation. At the Geneva bank, Fashanu revealed, Minton used to identify himself under the name of Mr. B. Katy. On 19 November 1998, a transaction of $4 million was conducted at the Discount Bank and Trust Company. According to the report in the African Confidential, “Nigeria bought back its debt in a top-secret operation that was technically illegal.” Schmidt and Minton made a fortune from the business. They bought the debt at 10 cents per dollar and resold to government at 45 cents , thereby making 30 cents on each dollar.
The EFCC would also have been using a book, The Sink, by Jeffery Robinson, an American writer. Robinson is a renowned international author and expert in money laundering matters. In the book, Robinson says that in 1989, a North America oil company offered to assist Nigeria permanently to solve the fuel problem. At that time under Babangida, the refineries in Nigeria operated at 40 per cent capacity and the country depended largely on importation for its domestic needs. The North Americans, in what appeared a good deal, proposed in exchange for crude oil and drilling concessions, their expertise to repair the refineries and drive them to operate at about 100 per cent capacity. That, ordinarily, would stop fuel importation.
But Babangida stopped negotiations on the deal because it would affect fuel importation from refineries in which he had interest. For those in government at the time, the endless circle of taking Nigeria’s crude to neighbouring West African countries where they were refined and later returned to be sold as fuel was a source of cheap money.
As Babangida prepares to contest election into the presidency next year, the welter of opposition against him mounts daily. At the EFCC, massive data, this magazine learnt, has been collected on him and other Nigerians who had corruptly enriched themselves from public funds. Investigators have been able to trace a lot of money in billions of naira, American dollars, pounds sterling and even German marks to IBB’s children and their companies. Officials of the Commission have been querying the source of the huge funds and whether taxes were even paid on them. At a seminar on economic crimes last week in Abuja, Chairman of the EFCC, Nuhu Ribadu, pointedly accused IBB of introducing Advance Fee Fraud, widely known as 419, into Nigeria. Lawyer and human rights activist, Gani Fawehinmi, also insisted that Babangida must be probed and made to face the music over financial crimes he committed during his heinous reign.
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