Kogi government denies diverting N20bn bailout funds, threatens to sue EFCC

The Kogi state government has vehemently countered the viral media reports involving an alleged order of the federal high court, Lagos division, freezing an account in Sterling Bank PLC allegedly holding Kogi state bailout funds on allegations of suspected fraud.

In a document titled PUBLIC NOTICE: Clarification on Alleged N20bn Bailout Funds Fraud and published on its website, https://kogistate.gov.ng/ova_doc/bail-out-fund-clarification/ the state government provided detailed accounts of how the funds were expended.

At a press briefing at the Kogi Liaison Office in Abuja, the state commissioner for Information, Kingsley Fanwo, described the alleged order as blatant lies told against the state government before the Lagos Division of the Federal High Court by the Economic and Financial Crimes Commission (EFCC).

Mr Fanwo further stated that the misinformation in a section of the media is capitalized upon by those he described as ‘shameless political vested interests.”

Giving account of events, Mr Fanwo said as of the 31st day of August 2021 when the Court Order to preserve the phantom sum of N19,333,333,333.36 was allegedly made, the Kogi State Salary Account No. 0073499012 where the sum of N19,999,000,000 was transferred to since 2019 for the payment of salaries had a credit balance of N44,816,195.24.

He added that the allegation that the Kogi State Government authorized the opening of a fixed deposit account wherein it deposited the said Bailout a loan of 20billion to generate interest for itself is false. He stated clearly that the Kogi State Government gave no mandate or instruction to Sterling Bank Plc to open a fixed deposit account on its behalf as it could barely meet the salary obligations for which the funds were received at the material time.

“Gentlemen of the Press, for the records, the Kogi State Government vehemently denies having the sum of N19,333,333,333.36 or any other sum in a fixed deposit account with Sterling Bank Plc as alleged. The Kogi State Government states that it never gave any instruction to Sterling Bank Plc and the said Bank also did not fix on its behalf, any bailout fund or any other funds. The Kogi State Government states that as of the 23rd Day of July 2019 when she allied the monies for the payment of salaries and allowances to Kogi State civil servants and up to the 31st day of August 2021 when the purported court order was procured, it had approximately N46,000,000.00 cumulatively in all the salary and bailout accounts it operates with Sterling Bank.

“Now to the background. Upon the assumption of office of the current administration in Kogi State, the State was in arrears of Salaries and allowances to Civil Servants and Pensioners more than N50 Billion Naira. The previous administration had applied for Bailout funds from the Federal Government to settle the said areas but could not access the funds until the expiration of their tenure. H.E Yahaya Bello, therefore, pursued the Bailout fund applications and secured Mr. President’s approval for the funds which were disbursed in tranches. Specifically, in July 2019 the President graciously approved the payment of the final tranche of the bailout loan to the State which came by way of an on-lending loan from the Central Bank of Nigeria via Sterling Bank Plc. Sterling Bank Plc disbursed the said loan using the Kogi State Bailout Loan AccountNo. 0073522756 on the 23rd of July 2019. (Here is a copy of the Statement of Account).

“The sum of N19,999,000,000 of the said N20,000,000,000.00 was at various times between the said 23rd July 2019 and 25th September 2019 disbursed to Kogi State Salary Account No: 0073499012 with Sterling Bank and the United Bank for Africa Salary Account No: 102089595797 from where the funds were judiciously utilized for the payment of salaries and allowances owed to the workers of the State. (Here is an attached schedule showing the disbursements from the Kogi State Salary Bail out Account.)

“The current balance in the said Kogi State Bail Out Accountant as of the date of the alleged ex-parte Order is the sum of N999,190.50. Accordingly, the allegation that any part of the bailout fund was not used for the purpose for which it was secured is not only patently false, it is malicious and unsupportable by any records, including bank statements relating to all material times”.

The commissioner however said, while the state is yet to conclude on the EFCC’s motive for this dishonorable act, it cannot but wonder if the ‘new’ EFCC is now lending its pieces of machinery for the use of politicians and detractors to tarnish the image of a State that has enjoyed the confidence and commendation of domestic and international partners as a bastion of accountability and integrity.