To read part 1 and 2 click here
Two years ago, as the late
evening sun cast the cityscape in brilliant colours and long shadows, the two
of us dragged our chairs under the Ube tree behind the Abuja office of PREMIUM
TIMES. The setting sun had left room walls radiating excess heat.
My guest was a contractor
who was turning his back on the Nigerian defence contracting gang. It was the
second day of a series of interviews that lasted several months. A tripod
propped a camera in front of us as he squealed on his collaborators and
described a particular corruption-ridden, hyper-inflated gunboats purchase
contract he masterminded.
“Why did you not back out
(when the government guy approached you to inflate the cost)”? I asked. “…for
the sake of the country. For patriotism.”
“Well, you are talking
about morals, ethics or considerations like that, but don’t forget that this is
a state affair and the state does not embody morality neither does it embody
those fine sentiments that people will wish to attribute to it,” he said.
“The state is a living
thing of its own and our kind of state is a very predatory state. It thrives on
power. Absolute power. And the basic source of capital accumulation for those
running the state and their political matters is through primitive accumulation
of capital, otherwise theft.”
My guest was describing an
inflated contract in which the government was paying him to buy military boats
that it already paid another contractor to supply.
Details of this and other
tainted contracts are the focus of a coming PREMIUM TIMES investigative series
that will reveal the greed and lack of patriotism of some of our country’s
security chiefs, abuse of public trust and mindless theft of public funds that
characterise defence procurements in Nigeria.
The Objective Situation
Contract inflation is a
public sector term that translates to “treasonable stealing”. For a number of
high-ranking government officials in Nigeria, stealing public funds through
contract inflation is a way of life.
A number of past Nigerian
officials are currently undergoing trials for alleged corruption-related offences
linked to defence procurements.
Back to my guest. He told
me he decided not to walk away from the fraudulent deal in question because it
posed no immediate legal threat.
In fact, the deal, he said,
got the backing of two National Security Advisers – Andrew Azazi and Sambo
Dasuki.
“…with the NSA involved I
was fine with it,” he said. “Afterall he is the chief accounting officer of
Nigeria’s national security. If he wants to buy it at N100 billion who am I to
say no?”
“If the public servant
holding power decided to add to what I have submitted and steal it, what can I
do about it?” he asked.
“The best I can do is to
report it. But who am I reporting to? To him, the very person doing the thing
(stealing)? So this is the objective situation.”
My guest’s narration that
afternoon portrayed Nigeria’s defence contracting as a sector operating like a
pure criminal gang with a well-formed sectioning of roles split between
high-ranking government officials, contractors, and manufacturers.
Government officials with
authority to initiate defence procurements award inflated contracts to
contractors who ferry kickbacks back to them. Patronage, rather than
performance, therefore, is the predominant deciding factor in awarding
contracts and dissent is treated with grievous repercussion, insiders said.
“Here, I think it is too
much asking of me to back out from a direct decision of the NSA,” my guest
said. “It would have meant totally shutting the door forever as long as that
NSA is in office.”
In subsequent parts of this
series, we will give you details of the fraudulent gunboats contract my guest
discussed. But for today, as part of this overview piece, we are reviewing
Nigeria’s top defence scandals as well as ongoing court cases related to
corruption in security procurements.
Top Defence Contract
Scandals of Last Decade
My guest was a member of a
criminal industry that has robbed Nigeria of trillions of Naira and an
estimated 20, 000 deaths of both soldiers and civilians, according to Global
Conflict Tracker by the Council on Foreign Relations. The fraudulent
contracting processes have also cost the nation multiple international
embarrassments.
According to a Transparency
International report, a network of Nigerian military chiefs, politicians, and
contractors worked together to steal more than N3.1 trillion through arms
procurement contracts between 2008 and 2017.
The contract my guest was
involved with would have seen himself, military chiefs and a couple of other
agents steal N3 billion.
Here are some of the top
defence and security procurement related scandals in recent memory.
1. Cash in bullion vans For
Special Services?
Late 2014 to early 2015
Cash withdrawal from CBN
using two bullion vans.
Former President Goodluck
Jonathan authorised the withdrawal of N67.2 billion in cash from the Central
Bank of Nigeria between November 2014 and February 2015 for “special services,”
linked to defence and security operations. How the funds were used remain
unclear.
2. Cash for Black market
Arms in South Africa?
September 5, 2014
The South African border
authorities seized $9.3 million belonging to Nigeria from two Nigerians and an
Israeli who arrived the country in a private jet owned by a pastor, Ayo
Oritsejafor. Customs officers discovered the money stashed in three suitcases
after the suitcases were put through airport scanners. The Nigerian government
later admitted the money was meant for the procurement of black market arms for
the Nigerian military.
3. The Amit Sade contracts
October 6, 2008
On that day, Amit Sade, an
Israeli contractor – who does not own any arms manufacturing business – working
out of Nigeria was gifted a combined N5.2 billion contracts. The first was to
deliver “assorted ammunition” at the cost of N2.1 billion. The other was to
supply “20 units of K-38 twin hull boats” at the cost of N3.1 billion. He was
paid 95 percent for the ammunition, he delivered a 63 per cent worth. On the
K38 boats, he was paid 80 per cent, he delivered only 40 per cent. In the last
decade, Mr. Sade, records show, was gifted another six heavy-weight military
contracts worth N6.721 billion. He is alleged to have failed to deliver on any
of them. He could not be reached to comment for this report. He did not reply
emails sent to him, and his current location remains unknown.
4. NIA #IkoyiScandal –
Defence cash stashed in defence chief’s wife’s apartment
April 12, 2017
Whistleblowers led the
Economic and Financial Crimes Commission to a house in upscale Ikoyi where
$43.4 million was kept. The NIA director later claimed the money was meant for
undisclosed special security and defence projects. Investigations are still
going on and the real motive for keeping the fund in that location remained
unclear.
5. Progress Limited “gift”
April 29, 2005 to October
19, 2010
The ministry of defence
gifted two purchase contracts to Progress Limited for the supply of 42 units of
BTR-3U Armoured Personnel Carriers and spare parts for the Nigerian Army
without documented contract or agreements. There was no cost negotiation
between the two parties. Two years later, 26 used APCs were delivered but they
broke down almost immediately after they were deployed for peacekeeping
operations in Sudan.
6. N2 billion grew wings
from the office of the National Security Adviser
May 13, 2013
The Nigerian government
released N1.35 billion to re-stock ammunition for OPERATION BOYONA, aimed at
dislodging terrorist camps along the borders with Cameroon, Chad, and Niger.
Two months later, the National Security Adviser, Sambo Dasuki, requested and
got approval for additional N2 billion. It does appear neither the Defence
Headquarters nor the soldiers on the battlefield benefited from the second cash
released to the NSA. The money is believed to have disappeared, an allegation
Mr. Dasuki is denying.
7. “Urgent” N7 billion Boko
Haram funds missing
January 2015
Nurudeen Mohammed, the then
Minister of State Foreign Affairs, requested N7 billion to urgently fund
operations of the Multinational Joint Task Force in the Lake Chad Basin. The
funds were released to the National Security Adviser. It is unclear how the
money was used. Officials say most were traced to companies that had no
business with the Task Force. One and a half billion naira was withdrawn in
cash.
8. Santa NIMASA
September 3, 2014, to April
30, 2015
Between the seven months of
September 2014 to April 2015, the Nigerian Maritime Administration and Safety
Agency paid out N8.5 billion to the Joint Task Force Operation Pulo Shield –
the military unit fighting insurgency in the Niger Delta. Most of the funds
were described as operation enhancers.
Over 70 per cent of the
funds (N6.2 billion) were converted to US dollars and handed over to an unknown
“Private Citizen”. No one also knows what happened to the balance — N2.3
billion.
9. The Shaldag contracts
2010
The Shaldag contract is one
of the deals that paved the way for a regime of kleptocracy in the Nigerian
Defence sector, and the emergence of a gang that has grown to be more powerful
than elected regimes.
The 2010 deal saw an
Israeli shipbuilder, Israeli Shipyards, win a $25 million contract to supply
Nigerian Navy with two fast assault boats. Their market value at the time was
estimated to be $5 million each.
Nigeria, therefore, lost
$15 million in the deal. It is unclear how the $15 million excess was shared
between everyone involved, but the Israeli police have established that the
middleman, Amit Sade, received $1.47 million in what is now termed brokerage
fee. Three people are facing trial in Israel over this deal.
When Generals become
bandits — List of Nigerian Military Generals Standing Trial For Corruption
Military Generals in
Nigeria form an important part of the contracting gang stealing from the
country through defence and security contracting. In July 2016, an
investigative committee set up by President Muhammadu Buhari, shortly after
entering office in 2015, released a report indicting 18 senior military
officials, 12 retired and serving government officials, and 24 CEOs. The panel
recommended further investigation and prosecution of the indicted individuals.
In February 2016, the
Nigerian Army announced that it handed over 12 senior officers to the EFCC for
their alleged involvement in arms scandal. The army did not name them but said
they included three serving major generals, and one retired, three brigadier
generals, four colonels and one lieutenant colonel.
“We have charged some
people to court, but the investigation into others has not closed,” the EFCC
spokesperson, Wilson Uwujaren, said.
Here are some of the senior
military officers indicted by the panel in its report as well as those publicly
known to be undergoing trial.
Lieutenant Colonel Sambo
Dasuki, retired: Although official banditry in Nigeria’s defence and security
contracting predates and goes beyond — the former National Security Adviser, he
is the highest-ranking government official held. He was arrested on December 1,
2015, by officers of the State Security Service (SSS) over the utilisation of
$2 billion meant for buying arms for the military.
In the scheme, high ranking
members of the then ruling Peoples Democratic Party, as well as other members
and friends of the government, set up companies and approached the NSA for
contracts. As it was later found out, the contractors simply walked away with
the funds while soldiers at the battlefront wrestled Boko Haram with bare fist.
Prosecutors claim the fund were diverted fund the party’s campaigns in the 2015
elections.
A Presidential panel was
later set up to investigate defence and security procurements dating back a
decade. The committee indicted Mr. Dasuki and other individuals.
He has been in detention
since his arrest despite bails by four High Court judges in Nigeria and an
ECOWAS Court.
Lieutenant General Azubuike
Ihejirika, retired: Mr. Ihejirika retired from the army in January 2014 after
serving as Chief of Army Staff for four years. He was appointed Chief of Army
Staff on September 8, 2010, by President Goodluck Jonathan. Seven months after
his retirement, Stephen Davis, an Australian negotiator who was working for the
Nigerian government as a go-between in the Boko Haram war called out Ihejirika,
as well as Ali Sheriff, a former governor of Borno state, as the “sponsors” of
Boko Haram.
Nigeria’s State Security
Service later claimed they found Mr. Ihejirika to be innocent.
Mr. Ihejirika was indicted
by the DasukiGate Panel for using family members and fronts to procure arms
contract. Twenty months after the indictment, the EFCC invited him for
questioning. As at the time of this reporting, he has not been charged.
Lieutenant General Kenneth
TJ Minimah, retired: Mr. Minimah took over from Mr. Ihejirika as Chief of Army
Staff and handed over to the incumbent, Tukur Buratai.
On June 30, 2017, an Abuja
High Court froze his accounts after the Economic and Financial Crimes
Commission accused him and a company, Stoke Synergy Nigeria Limited, of
stealing N13.6 billion from the Nigerian Army.
The EFCC claims Mr. Minimah
has refunded N1.7 billion.
Air Vice Marshal Alex
Badeh, retired: Mr. Badeh was the immediate past chief of defence staff.
The EFCC is accusing him of
stealing N3.9 billion from Nigeria during his tenure.
“He allegedly abused his
office as Chief of Defence Staff by using the dollar equivalent of the sum of
N1.4billion removed from the accounts of the Nigerian Air Force to purchase
properties in choice areas of Abuja between January and December 2013,” the EFCC
claimed in a statement.
Mr. Badeh and his family
company, Iyalikam Nigeria Limited, are currently standing trial for the “theft”
of N3.97 billion Nigeria’s defence and security funds.
Major General Emmanuel J
Atewe, retired: A former Commander JTF Op PULO SHIELD is standing trial for
allegedly “stealing” about N8.5 billion defence and security funds the
operations received from the Nigerian Maritime Administration and Safety Agency
(NIMASA). Mr. Atewe is charged alongside a former NIMASA boss, Patrick
Akpobolokemi, and two other staff of the agency: Kime Engonzu and Josephine
Otuaga.
An Abuja businessman,
Arinze Nkem, on Monday, June 19, 2017, told an Abuja High Court that the
General regularly paid huge sums into his bank account with instructions to
convert the remittances to US Dollars and redistribute.
“I bought a guest house for
JTF, Operation Pulo Shield for N170m upon instruction by Atewe,” Mr. Nkem told
the court. “I once paid the sum of N297m to a company called CISCO Nobot
Limited. I also paid N99m to Ocean Gaz Limited and another N88m to Lord Fem
Nigeria Limited, which all belong to him( Atewe).”
Air Vice Marshall Tony
Omenyi, retired: Mr. Omenyi and his company, Huzee Nigeria Limited, are
standing trial for allegedly stealing N136 million defence and security funds.
He was formerly a Managing Director of Aeronautical Engineering and Technical
Services Limited (AETSL), a company owned by the Nigeria Air Force. His
strategy was simple. According to court proceedings, he would cause his office
to award contracts to Sky Experts who subsequently will forward the money to
Mr. Omenyi’s company, Huzee ltd.
Mr. Omenyi claimed the
monies were “refund of loans given to Sky Experts,” indicating a further breach
of a constitutional code of conduct.
Air Marshal Adesola Amosu,
retired: A former Chief of Air Staff is standing trial for conspiracy,
stealing, money laundering, concealing of proceeds of crime and converting N18
billion belonging to the Nigerian Air Force, NAF, to personal use.
Mr. Amosu is being
prosecuted alongside two other high ranking colleagues: Air Vice Marshal Jacob
Bola Adigun, a former Director of Finance to NAF and Air Commodore Gbadebo
Owodunni Olugbenga, a former Deputy Director of Finance NAF.
Their corruption scheme was
similar to others in Nigeria’s defence contracting industry. NIMASA paid NAF’s
N3 billion to NAF’s Special Emergency Operation Account with Zenith Bank Plc.
Other sources paid N15 billion. The money was then forwarded to five companies:
Right Options Oil & Gas Limited, Judah Oil Limited, Delfina Oil & Gas,
McAllan Oil & Gas Limited and Lebol Oil & Gas Limited.
These are Bureau de
Changes, not oil companies as their names suggests and an insider, Mr. Adigun,
was an opening director at Delfina Oil & Gas and McAllan Oil & Gas.
These FX companies
converted the funds into US dollars and returned to Mr. Adigun and Mr.
Olugbenga. Delfina Oil & Gas and McAllan Oil & Gas Limited paid a chunk
of what went through them directly to Solomon Enterprises, a company owned by
Mr. Amosu, the EFCC claimed in court.
The three military chiefs
finally used the funds to buy properties in Nigeria and the United Kingdom. Mr.
Amosu’s wife, Omolara, one of the directors of St. Solomon HealthCare, also
received N95 million from the largesse.
Vice Admiral Usman Jibrin,
retired: A former Chief of Naval Staff, is facing trial alongside Rear Admiral
Bala Mshelia, Rear Admiral Shehu Ahmadu (all retired) and Habor Bay
International Limited.
The Nigerian Navy had no
need for the house and had no plans to buy it. There was no budget for it.
Apparently, a company owned by Mr. Jibrin’s family, Habor Bay International
Limited, needed it. The three Naval chiefs worked out a plan and pulled N600 million
from the account of Naval Engineering Services to pay for a property at Plot
No. 2717 Cadastral A06, Maitama, Abuja.
The property’s
documentation shows Habor Bay International Limited as the buyer and owner even
though the Nigerian Navy paid. Essentially, the former naval chief used
Nigerian Navy resources to illegally gift himself a N600 million property.
Others high ranking
officials recommended for prosecution over alleged corruption in security
procurement include:
Major General JAH Ewansiha,
retired: Mr. Ewansiha served as the Chief of Training and Operations in the
Army.
Major General Ugo Buzugbe,
retired: – former COPP(A)
Major General ER Chioba
(Rtd) – former DG DICON
Major General AI Muraina
(Rtd) – former CAB(A)
Major General DD Kitchener
(Rtd)- former COLOG
Brigadier General DM
Onoyiveta – former Chief Of Staff to Chief Of Army Staff
Brigadier General AJS
Onibasa – former OMT
Brigadier General M Mamman
– HQ NAE
Brigadier General Ashinze –
former SA – NSA
Colonel AA Abubagaji – former
Assistant Director Finance
Colonel AM Inuwa – former
Assistant Director Finance (COPP)
Colonel Lt Col El-Hussaini
Boyi, retired – former Assistant Director, Finance
Colonel Sqn Ldr M Oyaduogba
– Finance Officer JTF Operation PULO SHIELD
Colonel Abubakar Usman
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