Court orders Zamfara's Governor Yari to forfeit Paris Club refund used to pay off loan and build 100-room hotel

ZAMFARA State governor Abdulaziz Yari has been ordered to forfeit a combined sum of N500m (£1.2m) and $500,000 to the federal government by an Abuja court after he was adjudged to have appropriated money allocated to him as part of the Paris Club refund.

In April this year, President Muhammadu Buhari ordered the release of about N522.74bn (£1.27bn) to Nigeria's 36 states in the first tranche of the Paris Club refund which was paid to the country in December 2016.  Paid out to enable the states offset their salary and pensions arrears, the money was released following protests by states against over deductions for external debt service between 1995 and 2002.

Since the payments, however, there have been numerous allegations of state governors misappropriating the money and the Economic and Financial Crimes Commission (EFCC) has decided to take some of the governors to court. Governor Yari, the chairman of the Nigerian Governors' Forum (NGF) is alleged to have diverted to two companies he has links with.

First Generation Mortgage Bank and Gosh Projects are the two companies who have been asked to temporarily forfeit the money while the matter undergoes further investigation. According to the EFCC, the sums of money were fraudulently diverted from the NGF’s bank account on the instruction of Governor Yari.

It also alleged, in an affidavit filed in support of its ex-parte application seeking the interim forfeiture of the sums of money, that the N500m was diverted to offset Governor Yari’s personal loan obtained from the First Generation Mortgage Bank. It also alleged that the second firm, Gosh Projects, utilised most of the proceeds of the alleged loot, transferred to it for the purchase of building materials for Governor Yari’s 100-room hotel project in Lagos.

Gosh Projects was also said to have used part of the looted funds for the purchase of treasury bills and transfers to offshore accounts. Justice Nnamdi Dimgba made the interim forfeiture order of the sums of money to the Federal Government in a ruling delivered on June 30, 2017.

He also ordered that any persons or body with interest in the funds must, within 14 days of the publication of the interim order of forfeiture in any national daily, show cause why an order of final forfeiture to the federal government of the funds should not be made. First Generation Mortgage Bank and Gosh Projects, from whom the allegedly looted funds were recovered, were joined as respondents.

EFCC counsel, Ben Ikani, argued that firms that had no contract with the NGF, which was holding the Paris Club refunds in its account on behalf of all the states government. He alleged that the sum of N500m, recovered from First Generation Mortgage Bank was part of the N2.2bn fraudulently transferred by the NGF to Bina Consults and Integrated Services on December 23, 2016.

In addition, the EFCC accused Governor Yari of giving the instruction for the transfer of the N500m out of the N2.2bn to the First Generation Mortgage Bank. On how the alleged fraud was discovered, the investigator said the commission, sometime in January 2017, received intelligence in respect of a case against the NGF.