Despite the Guidelines issued by the Nigerian Financial Intelligence Unit (NFIU), facts have emerged that the state governors through their pronouncements and actions are still as determined as those before them to continue dipping their hands into the local government resources with their stranglehold on the joint state and local accounts.
The 36 state governors are set to drag the Nigerian Financial Intelligence Unit (NFIU) to court over its Guidelines that barred the governors from holding the State Joint Accounts over the local government funds.
According to a source the governors met in Abuja on Thursday and rejected a political solution to the disagreement with the NFIU over the Local Government statutory allocations from the Federation Account even as they considered the NFIU guidelines as unconstitutional.
(NFIU) Guidelines released in May, 2019 barred the 36 states governors from interfering with statutory allocation accruing to the Local governments directly from the Federation Account, which therefore means the governors have no business dipping their hands into the accounts of the 774 local governments and the FCT Councils. The Guidelines became effective from June 1 as the NFIU also threatened to deploy the powers within its disposal in collaboration with other security agencies to sanction any state government or official found to have violated the guidelines.
Provision 9 of the NFIU guidelines stipulates that ” it’s hereby provided that any public officer anywhere in the country and/or any private citizen found undermining or violating these guidelines will be investigated and prosecuted under the NFIU Act 2018, the ML(PA), 2011(as amended), EFCC Act, 2004 and the ICPC Act, 2000″.
Since it came into force on June 1, the guidelines banned banks, governors other financial institutions, public officers’ and stakeholders from tampering with the statutory allocations of Local Government Areas from the Federation Account. Individuals and companies, who default will face direct international and local sanctions.
The agency also imposed a daily N500, 000 cash transaction limit on all the 774 local governments in the country.
According to the guidelines local governments will now enjoy autonomy and can spend their funds free from interference from state governors who had initially taken over the monthly allocations of the local councils in the name of State Joint Local Government Account.
The state governors had earlier protested against the Guidelines and went to court but a Federal High Court in Abuja in June refused to restrain the NFIU from implementing its guidelines on the local government funds as requested by the governors.
Justice John Tsoho ruled that the Joint Account should only be used to distribute allocation account to the local councils directly in order to maintain their autonomy. No higher court has ruled on the matter so far.
The governors according the source however, insisted that the NFIU Act 2018 does not have the power to impose guidelines on local government finances, particularly on the issue of sanctions. The governors it was learnt also rejected the political solution to the impasse stressing that such option would amount to giving legitimacy to the NFIU on powers which it does not have.
One of the governors was reported to have said that they also believe in accountability and that was why they worked with the President through the Nigerian Governors Forum (NGF) for a peaceful settlement but soon realized that the NFIU guidelines were not in tandem with the provisions of 1999 constitution.
The governors are therefore heading to court to help them interpret Section 7(6) (a) and (b) and Section 162(6), (7), and (8) of the Constitution, which they claimed gives the National Assembly and the State House of Assembly the powers to make provisions for statutory allocation of public revenue to the local councils in the Federation and within the State respectfully.
A source from the NFIU told our correspondent in Abuja that it is not within the powers of the NFIU to sanction the state governments or its officials directly. He added that they only send intelligence to the relevant law enforcement agencies for investigation and prosecution of violators of the guidelines. He noted however, that the Unit can sanction the banks.
“We cannot sanction the state governments or its officials; but we can sanction the banks and recommend them to the CBN for further sanctions.
“In case of the state government or officials we send the intelligence to the relevant law enforcement agency for investigation and prosecution since we do not have those powers,” he said.
The NFIU source had said earlier that there appears to be some degree of compliance with the Guidelines as no local government has formally laid complaint to the agency. He promised that the agency will act on the receipt of complaints from the local councils.
“For now there have been no other directives on the local government issues and the banks have been complying and I think the funds have been going to the local governments and anyone that has not complained it means that they are receiving their funds.
BusinessDay on Friday contacted the National President of Nigerian Union of Local Government Employees (NULGE) Ibraheem Khaleel Abdulkadir to speak on the latest development but he did not pick his calls neither did her respond to text messages.
But in an earlier letter to all the chairmen across the 774 local government councils and the FCT, the NULGE President warned that any officer of the Local Government who “blindly follows the instruction of governors to transfer or divert local government funds to non-local government projects will be held personally liable.”
Innocent Odoh, Abuja
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