Alleged N12.3bn Fraud: Otudeko, others seek out-of-court settlement, as court validates trial

The Federal High Court in Ikoyi, Lagos, on Monday, dismissed the notices of preliminary objection filed by Oba Otudeko, chairperson of Honeywell Group, and his co-defendants against their fraud trial.

Following the ruling, the trial judge, Chukwujekwu Aneke, granted the request of the defence lawyers to adjourn the matter to enable them to explore an out-of-court settlement of the case.

Mr Aneke granted the adjournment of the case till 8 May, following the defence lawyers’ request first mooted by Mr Otudeko’s lawyer, Wole Olanipekun, who informed the court that discussions were underway to resolve the matter amicably.

According to the lawyers, the last meeting on the issue took place at the office of the Attorney General of the Federation, with all of them and the representative of the nominal complaint – First Bank – in attendance.

Earlier dismissing the defendants’ applications seeking to halt the alleged ₦12.3 billion fraud trial, the judge held that the case would proceed.

He held that “such applications could not prevent the court from proceeding with the matter.”

He emphasised that jurisdictional objections “should not serve as a barrier to trial at this stage in criminal cases.”

Following the ruling, the prosecution counsel, Bilikisu Buhari, representing the Economic and Financial Crimes Commission (EFCC), expressed satisfaction, stating, “We welcome the court’s decision and are prepared to proceed with the case.”

Settlement talks underway

Mr Olanipekun informed the court that the Attorney General of the Federation held a meeting on Wednesday (12 March), during which the defence lawyers and the representative of First Bank (the nominal complainant), agreed to pursue a settlement.

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Mr Otudeko’s counsel noted that, in line with this agreement, “no further legal processes would be filed by any party before or after the ruling.”

With the Attorney General’s approval, Mr Olanipekun further revealed that 9 April was the settlement meeting date. He requested an adjournment to a date after 9 April to allow time for a report on the settlement outcome.

When Mr Aneke asked the prosecution counsel if she was aware of the meeting, Ms Buhari answered in the affirmative, and suggested that a date be fixed for the settlement report and the defendant’s arraignment.

However, Mr Otudeko’s counsel objected to the prosecution’s push for arraignment, questioning “its necessity given the ongoing settlement process.”

Defence pushes for further adjournment

The EFCC counsel, Ms Buhari, insisted that the trial proceed as scheduled, prompting a debate over the next court date. Mr Aneke observed that the court would be on vacation after 9 April and proposed 8 May as the next hearing date.

Defence counsels, including Adeyinka Olumide-Fusika (representing the second defendant), Kehinde Ogunwunmiju (representing the third defendant), and Charles Adeogun (representing the fourth defendant), requested 9 May instead.

Mr Ogunwunmiju argued that a later return date would allow for further discussions. At the same time, Mr Olanipekun highlighted that the 12 March meeting “lasted over two hours and saw the participation of all key legal parties.”

He reiterated that the attorney general had advised a temporary “ceasefire” in legal proceedings to facilitate an amicable resolution. After considering the arguments, Mr Aneke adjourned the case to 8 May for a settlement report.

At the last hearing on 13 February, only Mr Onasanya and Mr Akintayo were present, while Mr Otudeko and the representative of Anchorage Leisure Ltd were absent. Mr Otudeko’s lawyer explained that his client was in the UK “for medical treatment and was not evading trial.”

Mr Otudeko was also absent from Monday’s proceedings.

In their push-back against the trial, the defence argued that the case “was civil, not criminal” and claimed First Bank had already resolved the matter. They insisted the court must rule on jurisdiction first. Still, EFCC prosecutor Rotimi Oyedepo (SAN) opposed this, stating that under the Administration of Criminal Justice Act (ACJA), such objections should only be considered after the defendants have made their plea.

Background

In January, the EFCC charged the defendants with advanced fee fraud involving N12.3 billion.

EFCC alleged that Mr Otudeko, a former Managing Director of FBN, Olabisi Onasanya, a former board member of Honeywell, Soji Akintayo, and a firm, Anchorage Leisure, conspired to perpetrate the fraud.

The EFCC accused them of defrauding FBN and its depositors by fraudulently misrepresenting loans as credit facilities for V-Tech Dynamic Links Limited and Stallion Nigeria Limited, an offence that violates Section 8(a) of the Advance Fee Fraud and Other Fraud Related Offences Act 2006 and Section 15(2)(d) of the Money Laundering (Prohibition) Act 2011.

The agency alleged that the defendants subsequently laundered part of the money through Honeywell Flour Mills Plc. The loans were reportedly disbursed in multiple tranches.

After the filing ofthe charges, the defence filed preliminary objections, arguing that the the court lacked jurisdiction to hear the matter. They argued that the matter was civil banker-customer relationship issue that was resolved over eight years ago. They maintained that the EFCC was involved in this resolution process, and thus, the matter should not be reclassified as a criminal case.

The defence also emphasised that payments had been made in full, with an agreement not to press charges, suggesting that the matter was resolved amicably.

Mr Aneke’s ruling on 8 May will determine whether the case proceeds to full trial or if an out-of-court settlement is reached.