There is a current unease among major stakeholders in the nation’s energy sector as the Supreme Court prepares to hear a case involving the Central Bank of Nigeria (CBN), Union Bank of Nigeria (UBN) and Petro Union Oil and Gas Company Limited, over an alleged £2.5 billion attempted fraud.
The hearing scheduled for October 7 2021 is critical for Nigeria’s economy considering the judgment sum, plus interest accrued since 1994 currently valued at $15 billion.
“Parallels have already been drawn between the case in question and the brazen attempt by the P&ID directors to defraud the Nigeria of the sum of $9bn in a case which sparked outrage from many quarters,” Unini Chioma, a Lagos based lawyer exposed to the oil and gas sector said.
She noted that concerned stakeholders expect that the apex court would ensure that justice is served in the matter in the interest of all the stakeholders concerned.
“All eyes are currently on the Supreme Court of Nigeria to deliver a sound decision, especially as the criminal case at the Federal High Court continues to unravel evidence, which indicates that the judgments in favor of Petro Union at the lower courts, were allegedly obtained by fraud,” Joseph Onele, an energy lawyer cutting his teeth at one of the top tier law firms in Africa said.
Other economists and financial analysts have warned against the financial implications of the apex court’s decision on Nigeria’s rising debt profile expressing concern that the outcome of the case must be unambiguous or difficult to interpret by all concerned parties.
Petro Union is being accused of obtaining the two judgments at the lower courts based on evidence that appears to have been predicated on falsehood, forgery, misrepresentation of facts which has occasioned a miscarriage of justice.
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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 £2.556bn 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 £2,556bn 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 £2.556bn, 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.
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 apex 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 Africa’s biggest 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 22nd June 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.
