By Our Correspondents
There are indications of fear and lobby in government agencies and banks with the resolution of the National Assembly to commence probe into alleged fraud and unclaimed dividend totalling N2.7 trillion.
The investigation set to be carried-out separately by committees constituted both in the House of Representatives and the Senate also include delay in the execution of projects on which funds have already been disbursed.
Information reaching NewsDirect from sources on Thursday revealed that tension in the concerned agencies and banks as the Committees assigned to conduct the investigations both in the upper and lower chambers of the National Assembly have been mandated to begin the probes.
Our correspondent can report that the Senate announced plans to probe the reason why N7.7 billion Kagara dam approved by the federal government is yet to be executed despite the fund had been disbursed.
Also, the House of Reprehensive on the same day announced plans to investigate non-payment of $7billion (N2.14 trillion) by asset managers and consequently probe N126.03billion unclaimed dividend in capital market.
With the Upper Chamber plans to investigate the N7.7 billion Kagara Dam, our correspondent gathered that worries are ongoing in the Upper Niger River Basin Development Authority (UNRBDA) over the resolution of the Senate.
The Upper Chamber, (Senate) mandated its Committee on Water Resources to probe the delay in the execution of project in Niger State despite the receipt of funding to the tune of N7.7 billion from the federal government.
Senator Sani Musa (APC, Niger East), who moved the motion disclosed that the Kagara dam was first conceived and awarded by the Niger State Government to a Kano State based company, WRECA, in 1992.
The project, according to Senator Musa, was conceptualised to provide portable water and irrigation to Kagara and its environs.
He added that due to the importance of the project, the Federal Government took over its execution and awarded same to Biwater Shellaber (Nig.) Limited in December, 1992 at the cost of N199, 222,596.
The lawmaker said the project suffered neglect because of lack of funding which necessitated its renegotiation in the year 2001 at the cost of N2.22 trillion.
He further disclosed that the Upper Niger River Basin Development Authority, which is the supervising agency, issued a revised estimated cost to complete the project in the year 2010 pegged at N5.56trillion.
“If this project continues to be operated in a ‘stop and go’ manner, the dream of our people for portable water and economic empowerment through irrigation farming will remain a mirage,” Senator Musa said.
However, the lower chamber has commenced investigation over the failure of 14 global asset managers and their Nigerian counterparts to repay $7 billion disbursed by the Central Bank of Nigeria (CBN).
This is sequel to a unanimous adoption of a motion moved by Abubakar Ahmad (APC-Gombe representing Edu/Moro/Patigi Federal Constituency) at the plenary on Thursday.
The Deputy Speaker of the House, Ahmed Wase, in his ruling mandated the House Committee on Banking and Currency to investigate the details of the disbursed funds by the CBN.
The committee is to determine the terms and conditions of the disbursement and find out if they have been complied with and report back within eight weeks for further legislative action.
In the motion, the Lawmaker disclosed that sometimes in 2006, the CBN disbursed seven billion dollars to 14 global asset managers and 14 Nigerian banks that were local partners to manage. He said that the asset managers and their Nigerian counterparts included Black Rock and Union Bank Nigeria Plc, First Bank of Nigeria Plc; BNP Paribas and Intercontinental Bank Plc; USB and United Bank for Africa; Credit Suisse and IBTC Chartered Bank Plc; Morgan Stanley and GTB Plc; Fortis and Bank PHB Plc among others.
He said that CBN gave each asset manager and its Nigerian bank counterpart $500 million from the nation’s foreign reserves to manage. The lawmaker said that six of the Nigerian banks that received the said funds had either merged or being acquired by other banks under the oversight of the CBN.
Ahmad said the asset and liabilities of the six merged/acquired banks had been legally acquired as part of the legacies of the defunct banks. He said after 13 years, Nigeria’s hard-earned seven billion dollars foreign reserves has not been repaid to the CBN and there is no action put in place to ensure repayment of the funds.
In addition, the lower chamber had announced on Wednesday to investigate unclaimed dividend in capital market and demand from Security and Exchanged Commission (SEC) reason why despite introducing E-unclaimed dividend years back.
The lower chamber had directed its Committee on Capital Market and Institutions to investigate unclaimed share dividends in the capital market, valued at over N126.03 billion.
This followed the unanimous adoption of a motion moved by member representing Malum Fashi/Kafur Federal Constituency, Hon. Babangida Ibrahim at the plenary.
In the motion tagged “Need to Investigate the Rising Value of Unclaimed Dividends, Unremitted Withholding Tax on Dividends and their Attendant Effects on the Nation’s Economy”, the Lawmaker stated that unclaimed dividends has continue to increase over the years, thereby increasing the unremitted withholding tax on dividends in the country.
Ibrahim said that the value of unclaimed dividends rose from N5.1 billion to N103.1 billion between 2002 and Nov. 2016, compared with the value of N2.09 billion in 1999.
He added that the value of unclaimed dividends as of March 2019 stood at N126.03 billion, almost three years after the 8th House’s intervention.
“The House is aware of the mechanisms put in place to address the issue of rising value of unclaimed dividends.
“These include adoption of electronic dividend payment method, dematerialisation of share certificates, acceptance of dividend warrants in both savings and current accounts.
“Others were the need for consolidation of accounts by the Central Securities Clearing System and Registrars and the need to resuscitate publication of names of owners of unclaimed dividends by companies, all of which had been applied with no significant positive outcome,” he said.
Ibrahim listed the implications of large value of unclaimed dividends on the economic development of Nigeria to include adverse investors’ confidence, decrease in availability of long-term capital for economic development and the likely volatility in the regulation of the capital market.
In line with the motion, the House mandated the committee to investigate the rising value of unclaimed dividends and unremitted withholding tax on dividend and their attendant effects on the nation’s economy.
As directed, the committee is to report its findings back to the House within six weeks for further legislative action.