How foreign leasing company defrauded us of $2m – Air Peace CEO

Allen Onyema, Chief Executive Officer of Air Peace, has narrated how his airline was defrauded of ₦2 million dollars by a foreign leasing company.

Onyema said when this happened, he refused to pursue the case because at the time, Nigeria was blacklisted for breach of contract.

“A foreign company defrauded us of $2 million. They told us they wanted to buy aircraft parts. They made us pay $2 million for the leasing contract. If I had stopped them from taking the aircraft after we had paid for the leasing agreement, Nigeria would have been further blacklisted. What you would be hearing is that Nigerian airlines are unreliable.”

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“For the sake of the aviation industry, I decided not to stop this transaction. The company took our money and never came back. They stole our $2 million. The Nigerian government got in touch with them. They said it was a private business matter and they would see what they could do, and they ran away with that $2 million,” Onyema said.

The Air Peace chairman disclosed this during the 29th annual conference of the League of Airport and Aviation Correspondents (LAAC) which held on Thursday in Lagos with theme; ‘Financing Aviation in Nigeria: Risks, Opportunities and Prospects.’

He said before now, Nigeria was blacklisted unofficially from accessing dry lease aircraft because in the past, some Nigerian airlines failed to pay the rentals, and when lessors came to repossess, the airlines went to court.

“I’m not going to go into that because it’s not totally the fault of those airlines either. You need to understand why they went to court. So you have to be careful to protect your country. You have to protect your flag. That was a sacrifice that we made for the good of other airlines in this country. If we had seized that money, we wouldn’t have been able to access dry-lease opportunities, because it would have further compounded the problems of the aviation industry,” he said.

Onyema who was a panelist during the conference, said that banks have become more strict in providing funding because people lack integrity where they borrow money and do not pay back.

“In Nigeria, funding is very expensive with 35 percent interest rate and it’s not even available to everybody. People are asked to also bring collateral that is almost impossible to get. We need the banks but the conditions being imposed are very far from being helpful,” he said.

He said in Air Peace case, it has shown some level of financial integrity and discipline and that is why the airline can access funds from financial institutions in Nigeria.

“The Nigerian aviation sector has started being a little bit more liberal, but you need to earn it.

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Onyema said government can help by creating a window for the airlines to access foreign exchange through the Central Bank of Nigeria or through the Bank of Industry.

“Egypt has done it. Some other countries have done it. The good thing this government has done for us is that it has made foreign exchange rates now stable. You can plan now, which is a good thing for the aviation sector.

“However, at the Central Bank level, they can create a window for airlines to acquire dollars at a slightly cheaper rate, because we are operating from a disadvantaged position when we operate from Nigeria,” he suggested.