£2.5bn ‘debt’: Petro Union, CBN, UBN’s battle shifts to Supreme Court

The Supreme Court will on Tuesday, April 13, resume the hearing on the Central Bank of Nigeria (CBN) and Union Bank of Nigeria (UBN) appeal, seeking to set aside a £2.5 billion debt judgment awarded Petro Union Oil and Gas Company Ltd.

The appeal followed the banks’ dissatisfaction with Petro Union’s victory at the Federal High Court, Abuja and Court of Appeal.

Petro Union is being accused of obtaining the two judgments at the lower courts allegedly based on evidence that appears to have been predicated on falsehood, forgery, misrepresentation of facts and concealment, which has occasioned a miscarriage of justice.

The banks have alleged that Petro Union in 1994 fraudulently procured a cheque from a branch of Barclays Bank in the United Kingdom (UK) with a value of £2.556 billion and presented it at one of Union Bank’s branches in Lagos, with a claim that it had a contract to construct two refineries, a fertilizer plant, and a cement paper bag plant.

They alleged that Union Bank’s investigation at the time revealed that the cheque/bill or instrument dated December 29, 1994, for £2,556 billion drawn in favour of Gladstone Kukoyi & Associates was confirmed by Barclays’ Bank to be fake.

They further claimed that Gazeaft Ltd, the drawers of the bill of exchange for the £2.556 billion, was confirmed by Barclays Bank not to have an account with Barclays and was not on the list of registered companies in the UK by the Companies Registry in the UK.

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But Petro Union maintained its claim that UBN received the sum of £2,556,000,000 on its behalf and transferred £ 2,159,221,318.54 to the CBN while retaining £396,778,681.46.

Petro Union’s demands were then followed by court actions against the CBN and Union Bank based on these claims.

However, the Court of Appeal upheld the judgment of the trial court. In the appeal before the Supreme Court, the CBN, and UBN are praying the apex court to quash the lower courts’ decisions on the grounds, among others, that Petro Union’s claim to the sum was allegedly based on fraud.

The banks are contending that Petro Union allegedly obtained two judgments at the Federal High Court and the Court of Appeal based on facts that were not only predicated on falsehood but which have criminal implications.

The appellants averred that these facts, if not carefully dissected by the Supreme Court, may occasion a miscarriage of justice capable of ruining the nation’s struggling economy.

They further averred that the judgment obtained by Petro Union at the Federal High Court in 2014 for £2.556 billion also carries an interest of 15 percent per annum from June 22, 1995 until payment.

Today, that judgment sum together with interest is over £12 billion (about $15.5 billion) – 50 percent more than the award in the Process and Industrial Developments Limited (P&ID) case and represents 44 percent of Nigeria’s foreign reserves.

They further claimed that the truth of the alleged fraud had been uncovered following the arrest, detention and ongoing prosecution of Petro Union and its officers at a Federal High Court in Lagos.

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