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SPONSORED CONTENT: FCMB's Monumental Bank Fraud: FCMB Now Threatens Libel Lawsuit Against Fraud “Claim”

FCMB displays its arrogance and contempt for Nigerian Justice: Though FCMB is being prosecuted in Lagos High Court for crimes of theft, forgery and perjury against its customer; and despite Lagos High Court ruling that FCMB fraudulently misled its customer and fraudulently concealed its customer's funds; FCMB nevertheless threatens to crush its customer with a libel suit for daring to complain! Why does FCMB believe it is above the Law?


  • There have been more developments in the on-going legal battle between FCMB and its corporate customer.  FCMB has put out an advertorial in the Punch newspaper.  FCMB complains that its customer has made “certain claims” on Sahara Reporters and that:
  1. these “claims” are “libellous”, and that FCMB’s lawyers will be taking “appropriate legal action”;
  2. these “claims” are all “sub judice” so FCMB cannot say anything outside the Law Courts but that they “hope to speak more elaborately on this matter [but only] in the fullness of time”;
  3. FCMB “remains committed” to “ethical and professional” banking; and anyway, FCMB is only involved in these matters because of its merger with FinBank.
  • So, what are these “certain claims” made by FCMB’s customer?  And why do they cause FCMB to threaten a libel lawsuit and declaim that the bank “remains committed” to “ethical and professional” banking?
  • Well, the customer essentially made four so-called “claims” against FCMB:
  1. that FCMB placed the customer in receivership over an alleged debt of ₦465.6 million; collected all of the alleged debt and then hundreds of millions of Naira over and above the alleged debt; but concealed these collections and unlawfully kept the customer in receivership for nearly 2 1/2 years;
  2. that what FCMB did was fraudulent;
  3. that in a separate English court case FCMB denied diverting $3.5 million of the customer’s money but this denial was exposed as false; and
  4. that FCMB has been charged with three counts of theft, forgery and perjury in the Lagos State High Court under suit no. LCD/168/2011.
  • So, the question may be asked, which of these so-called “claims” relates to matters which are sub judice and which of them is libellous?
  • The short answer is none whatsoever and none whatsoever.
  • How so?  Well, what FCMB conveniently “forgot” to mention in its Punch advertorial is that of the first three “certain claims” listed above, each and every one is supported by Rulings of a High Court.  As FCMB well knows once a court has made a ruling there can be no issue of sub judice and there can be no issue of libel.  Moreover, as FCMB well knows, under article 39 of Nigeria’s Constitution every Nigerian is guaranteed freedom of speech so the old English rules of sub judice evidently cannot restrict a Nigerian’s right to speak freely.
  • As for the fourth so called “claim” – that Lagos State has brought criminal charges against FCMB for theft, forgery and perjury – that is simply a fact and no mere claim.  And if FCMB wishes to bring a libel lawsuit against its customer for reporting this fact then so be it.  FCMB has already brought no less than four bogus libel lawsuits against its customer and has pursued these lawsuits despite its own lawyer’s advice that it has no valid claim.  So this newly threatened libel suit would merely be the fifth in line and just another example of FCMB’s abuse of the Nigerian legal system.
  • Let us start with the first of the “certain claims” listed above – i.e. that FCMB put its customer into receivership and then collected hundreds of millions of Naira over and above what it claimed to be owed.  This is what the Federal High Court of Nigeria had to say about this matter in a Ruling delivered back in 2007:

“In the matter on hand, the claim of the Plaintiff/Respondent [i.e. the customer] that the debt owed to the 2nd Defendant [i.e. FCMB] over which Receivers/Managers were appointed was ₦465,635,070.16 whereas the Receivers had realized on the account of the Plaintiff the sum of ₦781,455,166 is uncontroverted.”

“It has also been shown to Court that the Receivers had in fact realized more than the debt that [they] were appointed for.”

A full copy of the Court Ruling is published here.  The suit no. is FHC/CS/721/05.  This Ruling has never been appealed by FCMB.  FCMB has never taken issue with, or publicly objected to, the Ruling.  The underlying lawsuit itself has been terminated by court order but the Ruling remains unaffected by that order.  The Ruling stands and remains part of the permanent record of the Federal High Court.  Anyone who can read English and who can do arithmetic will know by reading the Ruling that the Federal High Court stated that FinBank (now part of FCMB) recovered over ₦300 million in excess of the alleged debt of ₦465.6 million.  And anyone who has ethics and professionalism knows that a banker who recovers money in excess of a debt must return this excess to his customer.  Indeed anyone who has ethics and professionalism would know that it is fraudulent for a banker to conceal an excess recovery from his customer and fail to return such excess.

  • The public may well ask themselves, if the Federal High Court made such a ruling eight whole years ago, then after all this time why has FCMB not returned this ₦300 million excess to its customer?  Well might the public ask, if FCMB has such contempt for the authority of the Federal High Court such that it feels free to disregard Rulings of the Court (when it means returning money to a customer), then why does it pretend to care about the principle of sub judice (when it means having to explain inconvenient behaviour) and to invoke sub judice when it does not even apply?  Indeed, one might also ask, where is the libel in a customer saying what has already been said eight years ago by the Federal High Court?
  • What then of the second of the “certain claims” listed above – i.e. that FCMB’s collection of hundreds of millions of Naira over and above what it was allegedly owed was a fraud?  Well, this is what the Lagos State High Court of Nigeria had to say about this matter in a Ruling delivered back in 2010:

“I have also carefully considered the affidavit in support of the application by the Defendant [i.e. FCMB], it is my view that there is evidence of fraudulent misrepresentation, concealment of facts [by FCMB] affording the Claimants/Respondent [i.e. the customer] grounds for setting aside the consent judgment…”

A full copy of the Court Ruling is again published here.  The suit no. is LD/1668/2009.  Anyone who can read English will understand by reading the Ruling that the Judge stated that FinBank (now FCMB) made fraudulent misrepresentations to, and fraudulently concealed facts from, its customer.  Fraud is a very serious matter.  By the rules, a Judge cannot make a finding of fraud unless sure beyond reasonable doubt; so for the Judge to have made such a Ruling shows that evidence of the bank’s fraud was clear beyond reasonable doubt.  FCMB appealed the Ruling to the Court of Appeal but its appeal was dismissed.  Evidently, FCMB would not have appealed the Ruling if it had not believed and understood that the implications of the Ruling were extremely grave and damaging.  But having lost the appeal, FCMB obviously knows and understands that the Ruling of its fraudulent conduct is now part of the permanent record of the Lagos State High Court.  Any member of the public is free to say that FCMB has behaved fraudulently.  Such member of the public is free to say so because that is what the Lagos State High Court ruled.

  • Now nobody really needs to be told that for a bank to conceal over ₦300 million of its customer’s money is a fraud.  But well might the public now ask: having been told for the first time in 2007 by the High Court that the customer does not owe any money and then having been told for a second time in 2010 by the High Court, not only that the customer does not owe money but that it was fraudulent of the bank to make such claims, why does FCMB still show contempt for the authority of the Federal and Lagos State High Courts?  Why does FCMB continue to dishonestly assert that its customer owes money?  More to the point, why does FCMB not simply return its customer’s money?  What does all this fine talk of ethics and professionalism really mean to FCMB?
  • It may now be seen that when the customer says it has been defrauded it is not simply a matter of cheap talk.  It is not a matter of making mere “claims” as FCMB pretends.  When the customer says that FCMB recovered hundreds of millions of Naira over and above what was alleged to be owed, that FCMB has not accounted for this money and that FCMB defrauded the customer, these statements are backed by the full authority of Rulings given the Federal and Lagos State High Courts in 2007 and 2010.  FCMB knows and understands perfectly well that all the talk of sub judice and libel is nothing more than just that - talk.
  • What, then, of FCMB’s excuse that it inherited all of these matters through merger with FinBank?  Does that absolve FCMB of responsibility in the matter?  All we will say is this: suppose that in times gone by a man inherits a slave.  The man knows that his slave is already fighting for his freedom in court.  The man could easily renounce his inheritance and give the slave his freedom but chooses not to.  Indeed, rather than renouncing his inheritance he continues to fight in court against the slave’s freedom, all the while publicly stating that he is “against” slavery.  Several years go by and the court case drags on.  The man is of course perfectly happy with this situation as he continues to profit from his slave’s labour while his slave ( who by definition has limited funds) struggles to sustain his court bid for freedom.  Then one day while relaxing in the public square the man overhears a citizen describe him as a slave owner.  The man indignantly proclaims to all in the public square that he is “against” slavery and anyway these are “complicated” matters which arose out of an inheritance.  What is one to make of this man?  Is it that the man cannot recognise slavery when he sees it so requires a court to tell him that he in fact owns a slave?  Or, perhaps, is the real explanation as simple as that the man thinks he is wise and everyone else in the public square is a fool?
  • The third so called “claim” that the customer made was that FCMB falsely denied receiving $3.5 million of the customer’s money and that this false denial was exposed.  Like the others, this is no mere “claim” but a statement supported by a Ruling of a High Court, in this case the English High Court.  As before we believe that the facts should speak for themselves.  Accordingly, a copy of the English Ruling is also published here.  The case no. is HC13E04381.  This is what the Judge had to say regarding FCMB’s false denials of receipt:

“89.  Ultimately, the case of Zumax is, and has always been, very simple. Monies were transferred to the accounts of IMB/IMB Morgan but were never subsequently received by Zumax. FCMB had asserted that the monies were never received in the accounts of IMB/IMB Morgan but that was plainly wrong. The transfers took place in this jurisdiction.”

“94.  The difficulty with these submissions, like so much else of FCMB’s case, is that it is somewhat unreal. FCMB had initially vigorously asserted that Zumax had received the monies in question, and that Zumax knew this very well. That turned out to be entirely wrong. A number of defences [FCMB] raised in the course of evidence or argument appeared equally misconceived.”

And this is what the Judge had to say about the credibility of FCMB’s whole case:

“95.  I am afraid that I ended up having no confidence that the matters raised by FCMB would be ultimately relevant to determination of the proceedings and increasingly formed the view that FCMB were willing to take any point to avoid a judgment, and that no proper sifting process had been carried out to determine whether any of the points raised were factually correct, relevant or arguable.”

  • English Judges are known for their understatement.  When someone is caught lying they say his statement was “wrong”.  So when an English Judge states that he doubts a person’s statements are “factually correct” and that he believes the person is “taking any point to avoid judgment” you can be sure that he has lost all confidence in the person’s credibility.  The reader may wish to be reminded here that these judicial observations are made of what is actually a bank and not a mere “area boy” of the kind to be found loafing around Tinubu Square in Lagos.  Most importantly, it should be noted that all of the observations made by the Judge relate to actions by FCMB’s current management.
  • The sad fact of the matter is that for FCMB this is all nothing more than a game to be played out through obfuscation and obstruction.  FCMB’s cynical calculation is that so long as it can prevent the Courts and the wider public from knowing what has really happened, then all it need do is keep loudly proclaiming that it is a bank of “ethics and professionalism”.  After all, who would one normally believe, the “word” of “big men” running a “big bank” which is listed on the Nigerian Stock Exchange and licensed by the Central Bank of Nigeria, or the word of a mere customer?  What we say is there is a better way to determine the truth of this matter.  All one needs to do is compare the “word” of the “big men” at the “big bank” against the word of (1) the Federal High Court, (2) the Lagos State High Court and (3) the English High Court, and then judge for one’s self.
  • Here is the reality of FCMB’s conduct.  We have seen that in 2007 the Federal High Court ruled clearly that the customer owes no money to the bank.  Yet in 2009 FCMB went to the Lagos State High Court, swore on oath that the customer owed it money, and on the strength of this falsehood obtained a Court Order freezing all of the customer’s assets, including bank accounts.  The customer could not withdraw any money to pay rent, buy diesel, pay its lawyers or do anything.  The bank’s clear intention was to asphyxiate its customer.  With the customer dead and buried the court case against the bank would also be buried, and then the bank would simply walk away from its fraud.  So as to guarantee the success of the planned execution, on top of the asset freeze Order the bank also obtained garnishee Orders from the High Court which it served on every major bank and every major oil company in Nigeria.  The effect of the garnishee Orders was twofold.  Firstly, it meant that any money owed to the customer would be diverted to FCMB – i.e. the customer would be cut off from all possible lines of finance.  And secondly, by painting the customer as a defaulter, the customer’s commercial reputation with banks and the Nigerian oil industry would be destroyed – hence no possibility of bank loans in the future and no possibility of employment in the future.
  • Now, we have also seen that in 2010 the Lagos State High Court ruled that FCMB’s conduct was fraudulent.  Following that Ruling in 2010, no ethical or professional bank would have maintained its garnishee and asset freezing Court Orders against the customer.  But FCMB was not in the slightest bit troubled by any of this.  Despite having been told by a High Court Ruling that its claims of being owed money by the customer were fraudulent, FCMB maintained its financial siege of its customer.  The asset freeze Orders remained and the garnishee Orders remained.  Eventually, in 2012 – three years into the siege – the customer managed to have the garnishee Orders struck out and the asset freeze (Mareva) Orders discharged.  As usual, and so that the facts can speak for themselves, a copy of the Lagos State High Court Ruling is published here.  The suit no. is LD/115/2005.  The Lagos State High Court also admonished FCMB for failing to disclose that the so called debt it had relied upon to obtain the Court Orders was tainted.
  • At the end of this 3 year siege without access to any money or assets the customer was only barely alive.  Indeed, in the 12 years the customer has been battling this bank the customer’s stakeholders have suffered severe hardships.  The bank’s merciless financial chokehold has left the customer living from hand to mouth.  The customer has had to struggle to find the millions of Naira necessary to fight the bank’s four bogus libel lawsuits and meet other expenses.  In some cases people associated with the customer (including family of workers) have died because they could not meet medical expenses.  And that is not all.  The customer and its stakeholders have had to contend with all manner of threats and insinuations.  The customer has been “informally advised” it is being “watched” by powerful person(s) in high places.  Bank accounts and telephones have been hacked.
  • It is the constitutional right of every Nigerian to have a fair trial.  But to have a fair trial you must first have a lawsuit.  And to have a lawsuit you must have a plaintiff.  A plaintiff must have a lawyer and a lawyer must have his fees paid.  So if a plaintiff does not have money then he will not have a lawsuit and then he will not have his fair trial.  Thus we see the true nature of the bank’s “ethics and professionalism”.  Thus also we see the bank’s belief and conviction that no matter how many times the Courts make a ruling that the customer owes nothing, the bank can simply ignore the ruling, publicly assert its “ethics and professionalism”, repeat what it perfectly well knows to be a lie that the customer owes it money, and then serenely sail on as before.
  • A final word.  All can now see that the criminal prosecution of FCMB for theft, forgery and perjury is a simple and undeniable fact.  Aside from this, all can now see that there is not a single one of the “certain claims” by the customer which is not fully backed up by a High Court Ruling.  All can now see whether or not these so called “certain claims” raise matters of libel or sub judice.  And all can now see for themselves who has been prejudiced and who has been denied justice.
  • We said before and we say again, the change we all seek in high places must begin.


Zumax Nigeria Limited