May 21, 2010
Following the exit of Prof Charles Soludo as CBN Governor last year and the decisive action taken by Governor Sanusi Lamido against the banks, a palpable dark cloud has engulfed the Mint as a campaign for tenure renewal for the Managing Director has entered its home straight.
Following the exit of Prof Charles Soludo as CBN Governor last year and the decisive action taken by Governor Sanusi Lamido against the banks, a palpable dark cloud has engulfed the Mint as a campaign for tenure renewal for the Managing Director has entered its home straight.The tenure of Ehi Okoyomon who was appointed by Soludo in 2005 for five years expires this year. A media offensive was launched to deodorize his image which has been variously tarnished as a result of allegations of corrupt practices, one of which culminated in his suspension. In a recent interview, he claimed to have been cleared of corruption by the ICPC but enquiries at the anti-corruption agency suggests that the file is yet to be closed and that no one has been cleared as claimed.
Having waged a highly energetic but unsuccessful campaign for tenure renewal for Soludo, the scandal tarnished Managing Director, Ehi Okoyomon is now beset with fear that his activities could now come under closer scrutiny by the CBN Governor, Alh. Sanusi Lamido who doubles as the Chairman of the Board of the Mint. And there are already signs that it is no longer business as usual as the Board under Sanusi has been unable to accept the draft 2010 budget submitted by the management of the mint to date. 4 months into the year, the mint budget which is usually settled in January has yet to be approved because we learnt from sources that, it is suspected to contain highly inflated capital expenditure items. For instance, there were no certified proforma invoices attached to the claims as the figures appear to have been picked from the air and this has left the management in a quandary.The media has in the past exposed the many indiscretions of the management of the Mint on several occasions but Soludo always looked the other way. These indiscretions have included requesting for bribes from foreign companies, awarding huge contracts unilaterally without due process, contract inflation,attempts to acquire Mint property illegally under the table by Okoyomon etc. Most recently have been the allegations regarding polymer paper from Securrency of Australia and the payment of bribes.
Our sources tell us that the investigation of request for bribes undertaken by the ICPC stalled because the alleged front, one Femi Kuku who claimed to be a lawyer but whom the Nigerian Bar have no record of, took to his heels and disappeared into thin air believed to have been spirited out of the country to avoid the inquisitorial arm of the ICPC and may be hiding in the U.K. or USA. An international warrant for his arrest may be issued any time now according to our sources and he is expected to sing like a canary when he is finally caught. Unsuprisingly, the management of the Mint all claimed not to know Femi Kuku who was heard on secret tapes claiming that he represented the mint management in requesting for bribes.
Reliable sources informed us that when the ICPC confronted Soludo with the petition addressed to him alleging corrupt acts against Ehi Okoyomon, Segun Oshatola(GM Operations) and Ibrahim Babayo(GM Finance), all he could say was that he asked Ehi Okoyomon to investigate the charges. It apparently never dawned on him that he was asking Okoyomon to investigate himself and that the outcome would be a foregone conclusion.
Similarly, the Board who were confronted with the same petition all came up with mealy mouthed excuses about not recognising the locus of the petitioner as if the damaging content and evidence on the petition was not sufficient to wake them up from their collective slumber or as our source put it, “their inept oversight of a most strategic public institution”. On the tapes supporting the petition, Kuku and Oshatola were heard demanding for bribes to put the order through and Kuku insisted that unless there was agreement to pay him on behalf of his principals, the order would not be given to Gietz. And so it came to pass that there was no agreement on the bribes and the Mint management decided that anybody but Gietz would do, not minding what was in the best interest of the Mint.
Now, a hologram applicator applies “patches” or holograms, a high security feature to banknotes and security documents. Its key requirements are precision and reliability. The reason why Soludo was unable to fulfil his pledge to Nigerians to stop the printing of currency overseas was because of the Mint’s lack of a machine to do this very important task. The Board of the Mint had authorised the procurement of a Gietz hologram machine since 2006 but intrigues set in within the management involving the demand for bribes which prevented its realisation.
Having failed to secure the understanding of the Swiss manufacturers of the world’s top performing hologram applicator, the FSA 1060 by Gietz AG of Gossau, Switzerland, to pay approximately 25% of the purchase price in bribes, through Kuku and Oshatola, the Mint management were determined that the Gietz machine would not be acquired at all costs. Following an exposé in the media of the request for bribes, a highly secretive operation was initiated by Okoyomon in which a small coterie was brought under his wing to procure another hologram machine. This meant that only a handful of trusted aides were aware of the reignited plans to procure the hologram machine. At first, a plan was hatched to import papers with holograms already applied which was laughed off as impractical. When that failed the secret operation swung into action. Sources have reliably informed us that the end result was that they placed an order for a Visionfoil 104 by Bobst through DeLaRue for around N200m knowing full well that the machine was incapable of meeting the capacity requirements. A further problem is that the
machine that they bought has no track record other than the manufacturer’s claims for it.At present the average production speed of the Mint’s machines are 10,000 sh/h. Our sources tell us that the machine acquired by the Mint is only achieving a speed of
4,000 sh/h regardless of the claims made for it. It is therefore causing a bottleneck in the production process and has become a major source of concern and embarassment.
We asked a specialist source in the security printing industry to
comment on the machine that the Mint bought and what we
learned was revealing. He advised that being a new machine, it
does not as yet have any track record other than the name of the
manufacturer which is neither here nor there. “In the foil stamping
business, that manufacturer is far from the No. 1. The machine was
unveiled in a blaze of advertising glory, but do we know anyone
who has verified the claims of the manufacturer in practice? No.
We know for instance that, the Visionfoil 104 is a basic machine
to achieve a basic application for foil stamping in a maximum sheet size of 1040 x 740mm. The claim is that a new unwinding system located outside the machine on the main drive side enables a precise foil travel through the machine. When you consider the long travel distance of the individual foil web before it finally arrives at the right position, you cannot help but have grave doubts that the requested register precision of +/- 0.5mm which is standard in the banknote business is achievable with this machine. The further claim of up to 7500 sh/h production speed is also unproven and one can only wonder aloud how this is possible with this type of foil feeding system and required hologram application. As stated earlier, the machine installed in the Mint is only achieving 4000 sh/h whereas the other machines feeding it are running at 10,000 sh/h.
Our industry expert further stated that , for a company that is applying holograms to banknotes for the first time in a major way, what the Mint need is a tried and tested machine with a track record of performance, reliability and serviceability. To be experimenting with a machine with no history of performance or record of reliability is very risky indeed. The Mint’s avowed ambition is to be the hub not just for printing of banknotes but for security documents such as cheque books, vouchers, visas, licences, bank cards, ballot papers etc, not just in Nigeria but for West Africa. What is required is a versatility and dexterity from reliable and durable machines with a performance history. They are gambling with the Mint. Now the machine which the Vacufoil 104 is based on is the Speria 104 and I can tell you that it does not have a great reputation for reliability in the industry at all. In fact I can tell you of a company in the U.K. which bought the machine for €850,000 not so long ago but is now trying to sell it for €450,000. Now you draw your conclusions.”
In response to a story in the press in 2008, the Mint management took out advertorials in some national newspapers. They told the world that what was published was a pack of lies and that no member of their staff demanded bribes. When they got to ICPC however, our source tells us that, it was a different story altogether. Apparently, it was tears galore for Oshatola as he struggled to explain that he really wasn’t asking for a bribe afterall but if Gietz could offer him employment when the order was placed. Our sources tell us that the investigators nearly fell off their chairs for his explanations.
In Nigeria when you are a General Manager of the Mint, and you say to a Supplier, “what are you going to do for me when the order is placed?”, we all know what you mean. In Oshatola’s case he says he meant a job and two years on, he is still at the Mint which suggests that either his job search has been fruitless or he has suddenly discovered the joys of working at the Mint. In Okoyomon’s case, it is a known fact that he was suspended from office for 3 months as a result of some of his indiscretions after the board found reason to query some of his actions but Soludo unilaterally recalled him.
Ibrahim Babayo (GM Finance) had claimed in a media interview that the Mint was going to buy the same machine that De La Rue use to apply holograms on the N1,000 note. However, it is either he was ignorant or being dishonest because the Vision 104 is not the same machine that De La Rue use and it is common knowledge that, De La Rue have had to customise their foil stamping machines extensively at great cost to obtain optimal performance. Now tell me, why would any patriotic Nigerian want to put his country through this kind of trauma when the opportunity is there to get it right first time? It is understood that the Mint management relied on the advice of De La Rue who are an interested party being the middlemen in supplying the Bobst Visionfoil machine against the better judgement of the technical teams within the Mint. So you cannot really say that they have had the benefit of independent advice either. In the Mint’s advertorial, they claimed there were foreign companies who were interested in taking over the Mint’s business and therefore engaged in acts of calumny against it. Well De La Rue is known to have bidded to take over the Mint in the past and this is where they seem to be going for advice. Could it be a case of Tom and Gerry or is it a case of the boy who cried wolf? Furthermore, the GM Finance claimed that the Mint does not deal with middlemen but it has not bought this machine from the manufacturer we are told but from De LaRue who don’t make the machines. So whom is zooming whom?
The real problem with the hologram machine that has been installed is that the bottleneck in production it has created can only be resolved by the acquisition of another machine for $2m or a resort to the wasteful importation of currency with its attendant security implications which was highly lucrative for the principal officers of the Mint that it created a disincentive for its cessation. Now that says a lot for a legacy of 5 years of Okoyomon’s international best practice which he promised when he first came to the Mint.
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