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Sunday, January 5, 2020


A renown Forensic Accountant, Chief Ori Adeyemo exposes the under belly of Nigerian banks and their links to corruption and underdevelopment of the country, calling on the Federal Government to beam its anti-corruption searchlight to the banking sector in this interview with NGIJ team of Oluwasegun Abifarin, Olawale Abideen and Adeyemi Obadimu Who is a Forensic Accountant? A Forensic Accountant must first of all, be a Chartered Accountant, with a deep bias for fraud investigation and knowing fully well that the matter may end up in court. He must also be ready to defend his position in court. So, it is that court issue that differentiate a forensic accountant from other forms of accountant or auditor. Is it that Forensic Accounting is more lucrative that the others? No. It is not about profitability. If it is about money, I would have been in Auditing or join a Multinational company to earn dollars. But this job is first of all about social service to “help people out of a very bad situation and shed light on the bad situation.” Forensic accounting is also very deep, because while other accountants are looking at figures on top of the table, the forensic accountant is looking at under the table; looking for what is hidden. But then what has been your experience in the forensic business? My experience has been mix-feelings, with the fact that most importantly, people have been coming to appreciate my efforts. I could have been dead by now, if not for the help and efforts of people. I have also known that when it comes to financial relationship, most Nigerians are greedy. They also want to take undue advantage of others, especially the banks in Nigeria… So, this is the summary of my experience as far as forensic accounting practice is concerned. And you cannot do this well without good knowledge of accounting practice and litigation support. It is not possible. You started with individual clientele. Now State government are hiring you… It is still the same thing. When we investigate for individuals or for states, we are still talking about banks which have been shortchanging the state governments and stealing their money. So, it is still the same thing. The only thing is that the clientele base has now shifted from individuals to government institutions. Based on your experience, how would you describe the Nigerian banks? Nigerian banks are crooks; they are fraudulent; they are rogues. They are thieves. In fact, if the federal government wants to curb or stamp out corruption in Nigeria, it should start with the banking industry. The sector is the crudest and the crookest industry you can ever think of. They are shameless and have no morals at all when it comes to dealing with their customers. In fact, they actually encourage impunity of the highest order. Even the CBN and the NDIC that are supposed to regulate them have become helpless because the banks have been able to pocket their officials to the extent that rather than the CBN regulating the banks, it is the banks are “supervising” the regulators. This sounds bizarre and strange, but that is the truth. Seriously, the anti-corruption war has to start from the banking sector. But why is it so easy for the banks to get away with these impunity and infractions? It is a combination of various factors. One, ignorance on the part of Nigerians. Nigerians are not well educated on their rights, when it comes to dealing with those banks; and so, the banks get away with blue murder. But things are changing now, because if you get to courts now, you see a lot of customers challenging them, unlike what use to happen in the past. Can you tell us how you moved into States hiring you to investigate their revenue collection and default? It is the same thing. The state is an entity too like all these individuals and corporate entities that engage us. The banks also dupe the states, but this time in a deeper way. In the states, we don’t do the orthodox ways of investigation; we already know what to do, because these banks, like I told you are fraudsters. What they do is to hide a lot of things; a lot of revenue from the state government and when officials of state government come to them, they compromise them, and then, those revenue are lost. But with us, we want to tell those government that this is where your money is hidden and then go for it. What then was your experience in those states that hired you? In Nasarawa State, we were given engagement letter on December 16, 2016, to help the state to investigate and identify their suppressed IGR vis-à-vis withholding tax, tax on dividends, excess bank charges as well as high net worth customers. We set to work early January 2017 and went all the banks operating in the state. About 12 of them co-operated with us and allowed us to access their data. After analyzing their data, we came up with various liabilities against them, though some of them raised objections which we responded to. And then, the person we were liaison with in Nasarawa state was the former Chief of Staff to former Governor Al-Makura. Part of our agreement was that we will give them quarterly report, but they so much love our work, that we were corresponding with them on a daily basis. But some banks out rightly refused to cooperate with us; about four of them. But for the 12 of them that cooperated and us access to their data, there was an outstanding of about 3.6 billion naira as revenue from 1999 to 2017. What then happened after this discovery? In July 2018, the state government served them final demand notice, which means that these liabilities are concrete. But all of a sudden, the state government stopped relating with us, and all efforts to communicate with them were rebuffed. Later, what we heard was that they have gone to compromised with those banks on the 3.6 billion naira liabilities by collecting pittance from the banks, and issued clearance letters to those banks.. That was the Nasarawa story. What did you do after this? In August 2019, we had to write to them asking the Nasarawa state government to pay us our commission amounting to about 727 million naira. They replied on 7th October, 2019 that they want to do their own in-house investigation and will get back to us. They also claimed that we did not sign all the relevant documents before starting the job and that we also did not give them quarterly report. We equally wrote back, insisting that they should have concluded their in-house investigation before writing us, otherwise they would have known we signed all relevant documents. What do mean by this? The initial agreement was for two years, to run from January 2017 to January 2019, but by June 2018, they have stopped communicating with us. This development actually fuelled our suspicion that they have gone to compromise with those banks. That was why we wrote to demand for our 20 per cent commission, which they have failed to pay. Suddenly, they said they have sacked us. We said no. It is not possible because we have not receive any sack letter or termination of agreement letter. Till date we have not received such letter. Meanwhile, those banks have not also denied those data which we used to generate those liabilities against them were false or manipulated. The last letter we received from them in November 2019 is that our contract has expired. Fine. We now asked them for our commission. We also reminded about the four banks that refused to cooperate with us and that it is duty of the state to compel them to come forth. They have refused to do so. Who are these four banks? Heritage Bank, Sterling Bank and two others So, what was your forensic experience in Niger State? For Niger State, we got the first engagement in July 2015. They gave us another letter in November 2015 for nine months to cover all the 18 banks operating in Niger State. At the end of the day, we also did the same exercise like we did in Nasarawa State. Initially, two banks – First Bank and Union Bank were able to resolve their issues, while banks like Sterling Bank and Unity Bank refused to cooperate with us. After completing our exercise, the outstanding final conclusive demand stood at 3.7 billion naira. Just like it happened in Nasarawa State, they also got fake consultants to help them negotiate with willing banks. For instance, FCMB with a liability of 234 million naira paid just 2 million naira. Fidelity Bank with 436 million naira liability paid a token of 4 million naira and Sterling Bank with 460 million naira paid 8 million naira. So rather than paying a total of 1.9 billion to the state, they got a mere 14 million from these three banks. There is also a 5.7 billion naira liabilities form the other banks that we were able to established. What efforts did you make after these discoveries? It was not until August 2019 that I got access to the state governor, reminding him about the liabilities of about 5.7 yet to be collected. The governor then set up a panel of enquiry headed by the Deputy Governor to confirm those figures and I was invited to meet with the Deputy Governor. When I got to Minna, I decided to check the banks again one by one, and found out they have excluded FCMB, Fidelity Bank and Sterling Bank. This again arouse my suspicion of compromise. Are you really sure of these your claims? Look, people who know me very well know that I don’t make frivolous allegations. I have gone beyond that stage. On these claims, I can supply date by date, and branch by branch details of all the banks involved; and equally the name of the payer, the amount paid, the gross credit interest deducted, the 10 per cent withholding tax. All the banks have not challenged these. If I had lied against them, you could have seen all kinds of rejoinder and court papers. What then do you think have been stopping these states from dragging the banks involve to court? One, the Deputy Governor of Niger State for instance, brought ethnicity into the matter, because they told him I was not from Niger State., and that as an Ibadan Chief, everything I was saying was a lie. Until I started bringing out documents written by the Board of Internal Revenue itself to those banks. The man later told me in August 2019, that he was traveling and will be back in September and that we should meet to resolve the matter on how I want to be paid my commission, since we have agreed that we have finished the job. But up till now, I have not heard anything again from him. How do you feel about all these? I see this as a grand and deep conspiracy against the good people of Nasarawa and Niger States…and this is the reason why there is under development in the states and in so many other states. Money that used have been used to develope these states are being diverted by some people. I think what the two states should do is to overhaul their Boards of Internal Revenue. We learnt you have petitioned the anti-graft agencies over this issue. What has been the outcome? I am still waiting. The EFCC for instance said they are still investigating. I am waiting, since I am not ready to lose my over 1.9 billion naira commission to the two States. If Nasarawa and Niger States are not ready to collect their IGR from the banks, they cannot negotiate my commission away. And whenever the EFCC is ready, I am ready to meet those banks in court. I am not afraid of them. I have been engaging the banks for over 32 years. Let the EFCC just invite us, you will Niger will become richer by 4.6 billion and Nasarawa by 3.6 billion naira. Do you think the scenario in these two States are also occurring in other states? Apparently. And this lead me to another issue. Most of the corruption cases being lost in the court is as a result of shoddy investigation because they fail to engage professionals to tell them what to do. What are the risk or the danger involved this your adventure? Every job has its own risk, even life itself is a risk. Threat to Life? May be when I started initially, but not anymore. I think the banks have taken “banking notice” of me. I have become a bone in their throats. What is your advice to other States yet to carry out forensic auditing of their revenue? Simple. They should get competent people to do it for them. For instance, if Lagos State government decides to do it today, all the banks will collapse. Go and write it down. If Governor Sanwoolu decides to investigate banks on Lagos IGR collection, all the banks in Nigeria will collapse, because these banks have been milking the state. Even if the governor of my state, Oyo decide to embark on it, the banks will collapse. I am not joking.

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