NPA fraud: The report that nailed the Board

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March 05, 2006/Source of Picture & news Story ( Punch newspapers)




A detailed account has emerged of how the Board and Management of the Nigerian Ports Authority (NPA) between 2001 and 2003, colluded with some local and foreign contractors, to defraud the nation of billions of Naira.

The current Deputy National Chairman of the ruling Peoples Democratic Party (PDP), Chief Olabode George, was the Chairman of the NPA during the period.

A copy of the report of the Special Committee on the Review and Verification of Contracts awarded by the NPA during the period recently submitted to President Olusegun Obasanjo, obtained exclusively by Sunday Punch, unambiguously accused the entire Board and Management of colluding with the contractors to defraud the nation.

The seven-member investigation panel, headed by the Chairman of the Economic and Financial Crimes Commission (EFCC), Mallam Nuhu Ribadu, said no member of the board and management could exonerate himself from the massive fraud perpetrated during the period under review.

“Given the massive evidence of irregularities in the award of the contracts under review, particularly, the flagrant violation of due process, gross and massive inflation of contract prices, excessive contract splitting, wide spread failure to protect the integrity of contracts by duly signed documents, it is the firm belief of this Committee that the board, the management and all approving officers, who were principally associated with the processing and award of the contracts under review are liable either directly or vicariously for the irregularities.”

In the report, the committee said available information indicated that the total number of contracts awarded during the period was 24, 252, stressing, “However, the Committee strongly believes that the figure could be considerably higher but for poor record keeping by NPA.”

•In monetary terms, the total values of the contracts awarded were to the tune of forty-six billion, nine hundred and forty-two million, four hundred and two thousand, seven hundred and seventy-six Naira and thirteen kobo (N46,942,402,776.13).

•The amount also included two hundred and thirty six million, nine hundred and thirteen thousand, nine hundred and eighty-six US Dollars and eight-four cents ($236,913,986.84).

•In addition to that was another sum of twenty four million, nine hundred and five thousand, five hundred and eight-eight British pounds and twenty-three pence (£24,905,588.23).

Others include, DMI 461,936.65; E147, 926,597.99 and SEK4, 087,918.70.

Specifically, the report of the committee stated that many of the contracts were given out simply to defraud the nation.

“We observed that due process for the award of the contracts was not followed at NPA. Most of the contracts reviewed were not awarded on the basis of need but just to create an avenue to siphon money from the system.”

The committee noted further that the authorities even imported, at inflated prices in foreign currencies, items that could be locally sourced.

“Numerous contracts were awarded in foreign currencies at highly inflated rates the supply of items that are easily available in Nigerian markets. Some of these items include umbrellas, ball pens, fire service equipment, etc.”

The report equally cited many cases in which huge sums of money were paid to both local and foreign contractors who failed to execute their contracts.

Consequently, the committee advised the Federal authorities to declare one Mr. Mike Odumosu wanted for defrauding NPA.

It also blamed undue influence from top government officials, members of the National Assembly, party leaders, traditional rulers, and other eminent citizens, for the sleaze in the federal-owned parastatal.

“The Nigerian Ports Authority was and is still operating under serious pressure from top government functionaries, legislators, party leaders, traditional rulers and other influential members of the society for contract awards.

“ This factor is largely responsible for the massive and indiscriminate award of contracts in NPA, which seems to have defied all measures so far taken by the government to halt this tendency.”

While alleging a massive fraud at the London Office of the parastatals with the connivance of some contractors and the authorities, the committee submitted that 100 per cent payments were made to 23 contractors for jobs yet to be executed, years after the funds were released.

In its 31-point recommendation, the committee said that the entire members of the Olabode George-led board, management and other approving authorities should be held liable for fraud and “sanctioned for contract-splitting, inflation of contract price in utter disregard to laid down government rules and regulations.”

Attempts to get the comment of George on the reports did not succeed on Saturday, as a woman who picked the phone in his house on Victoria Island told Sunday Punch that he could not be reached on his mobile.

When told that the call was meant to get his reaction to the report, she claimed that the PDP leader had travelled out of the country.

She declined to say when he would come back to the country.

But in an interview, he granted a national daily last week, he dismissed his indictment by the report of the committee.

“It is nothing to me indicting the board on my tenure. The board was not an executive board. It is a part-time board. When you know the workings of government, the workings of an organisation, then you wonder, was it the board that was just awarding contracts to every Tom, Dick and Harry outside the limits of the board?

“They indicted me about what? I heard the indictment before. When I heard, I said, ‘what are they talking about?’”

Asked to explain what actually happened on the matter during his tenure, George said, “The management went into crisis, there was an internal squabble among themselves.

“I was there in the office when it was reported to me what was going on, I was shocked. I said what! Call the Managing Director for me, the MD came, they had gone into physical combat, using foul language against themselves, I said no, that members of the board should form an audit committee to examine all the accusations. That was what led to all these.

“They made the report and when I got it, I discovered that there was something going on that was very unpleasant for the managment of this organisation. That is how the case got reported.”

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