Court documents filed by U.S. banking giant, JP Morgan Chase Bank, have revealed the Nigerian officials who authorised payments of $875 million to accounts linked to a former Nigerian oil minister in the fraudulent Malabu deal, Dan Etete.
The details are contained in a fresh claim filed by the bank to counter the massive claim for damages filed by the Nigeria government in 2017.
The documents were made available to PREMIUM TIMES by this newspaper’s London partner, Finance Uncovered.
Those named to have authorised the payments, which were made in 2011, are Yerima Ngama, at the time Minister of State for Finance and Otunla Ogunniyi, then Accountant-General of the Federation.
The two others named as authorised signatories at the time were Danladi Kifasi, Permanent Secretary at the Federal Ministry of Finance and Babayo Shehu, Director of Funds at the Office of the Accountant-General.
Nigerian government’s claim
Last November, the Nigerian government had sued the bank for $875 million (N315 billion) in the London courts over its alleged failure to block payments made from the massive Malabu oil deal that is under a string of international corruption investigations.
In the civil claim issued in the High Court, the Nigerian government argued that JP Morgan had been “grossly negligent” when it was banker to a previous government.
The claim alleged that JP Morgan did not act “with the reasonable care and skill to be expected of a bank in compliance with the laws of England and Wales” when it authorised enormous payments resulting from the 2011 oil deal.
There was an “abuse of the banking system”, the claim said, adding that JP Morgan “could and should” have done enough reasonable due diligence to discover the deal involved the “misappropriation” of up to $1.1 billion from state coffers.
It, therefore, demanded that the bank repay $875 million it paid out to Mr. Etete, plus interest, and to account for the rest.
JP Morgan Court claims
The bank, in its counter claim, submitted in the Business and Property Courts of England and Wales, denied any wrongdoing.
The document, seen by PREMIUM TIMES, was dated March 29 and signed by Rebecca Smith, a representative of the bank’s solicitor–Freshfields Bruckhaus Deringer LLP, London.
The bank admitted that on May 4, 2011, an escrow agreement was concluded between the Federal Government of Nigerian (FGN), JP Morgan and two other parties including Shell’s SNEPCO and Agip(Eni).
The government had earlier in April 2011 agreed to allocate the controversial OPL245 to both SNEPCO and NAE, with agreement that the two parties will transfer $1,092,040, 000 to a Nigerian government’s escrow account with JP Morgan.
The bank, which became an ‘Escrow agent’ by the terms of the deal, said it was obliged to receive the money and transfer to accounts nominated by the Nigerian government but was not a party to the Malabu Resolution deal.
NAE transferred the amount to the account in two instalments on May 24, the documents revealed.
The bank claimed that by a letter from the then Minister of State for Finance, Mr Ngama, dated August 3, 2011, the Federal Government of Nigeria (FGN) informed the bank of new signatories to the Depository Terms.
Mr Ngama’s letter, it said, stated that instructions on the depository account should be given by one “Category A” signatory and one “Category B” signatory. While Mr Ngama himself and Mr Kifasi were named as “Category A” signatories, Messrs Ogunniyi and Shehu were named “Category B”.
On August 17, 2011, the bank said a written instruction signed by Messrs Ngama and Ogunniyi instructed the bank to transfer the sum of $401,540,000 and a separate $400,000,00 to two accounts in the name of Malabu at First Bank and Keystone Bank, respectively.
On August 23, the bank said it completed telephone call-backs to both Messrs Ogunniyi and Ngama to confirm their written instructions, obtained go-ahead consent from UK’s Serious and Organised Crime Agency (SOCA) before it subsequently made the transfers.
By July 3, 2011, the bank said it received another instruction from Messrs Ngama and Ogunniyi requesting the transfer of $74,200,000 to a Malabu account at Keystone bank. Again, the bank said it completed telephone call-backs to the duo to confirm the instruction and obtained a SOCA go-ahead authorisation before it effected the transfer of the fund.
In making both transfers, the bank said it acted pursuant to valid, irrevocable and binding instructions given by the Federal Government of Nigeria as it was required to do under the terms of the Depository Agreement.
It also denied knowledge of the Nigerian government’s claims that the Malabu Resolution Agreement was a “sham” because according to its Depository Agreement, it stated that it had no knowledge of any other agreement the Nigerian government was into as it was not a party to it.
The named officials
While Mr. Ngama was a political appointee of the Nigerian government at the time, Messrs. Ogunniyi, Kifasi and Shehu, were public servants. None of them is currently facing prosecution over the Malabu scandal.
Mr. Ogunniyi, however, is being prosecuted by the EFCC over a separate money laundering case involving diversion of N2 billion from the account of the Office of the National Security Adviser, ONSA.
Few months after President Muhammadu Buhari assumed power in 2015, he approved the pre-retirement leave for Mr. kifasi with effect from October 20, 2015.
Mr. Ngama, now a leader of the APC, defected to the ruling party after he lost in his bid to contest as governor in Yobe State on the platform of the Peoples Democratic Party in 2015.
PREMIUM TIMES had earlier reported that when invited for questioning by the Economic and Financial Crimes Commission, the former minister of state for finance said he acted based on the directive of then President Jonathan.
The then Attorney-General of the Federation, Mohammed Bello Adoke, who is on exile, said in a statement in 2016 that his office helped the country broker the agreement between Malabu Oil and Gas Limited and Shell Nigeria Limited to prevent Nigeria from paying a fine of $2 billion as damages for breach of contract.
The EFCC later filed charges against him and Mr. Etete.
The notorious Malabu deal, over OPL245, involved Shell, Italian oil company ENI, Mr Etete, a former Nigeria president Goodluck Jonathan and his then oil minister, Dieziani Alison-Madueke.
In March, an Italian court adjourned the trial of Shell and Eni and its former executives to May, 2018. All of them have consistently denied any wrongdoing.
Mr Etete, who remains unreachable, has also denied wrongdoing.
Similarly, Mr Jonathan, who is not facing trial and under whose administration the deals were struck, has also denied wrongdoing.