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Published On: Mon, Aug 27th, 2018

EFCC swoops on Rivers over N117bn suspicious withdrawals

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• To quiz Wike’s finance director, cashier, others
• Detains Bank MD over faulty transactions
• It’s all political witch-hunt, says Wike

By Ese Awhotu

Strong indications emerged yesterday that the Economic and Financial Crimes Commission, EFCC, has launched probe into the state of finances of River State Government focusing on allegations of desperate, suspicious and unexplained repeated withdrawals running to about N117bn in the last three years.
Very reliable sources who gave the hint yesterday said already, the EFCC is in possession of an avalanche of records of financial transactions which give details of the ways and means by which the N117bn was laundered by officials of the Rivers State Government, ostensibly working on orders from ‘above.’
The sources hinted that as of yesterday, the Managing Director of a leading bank which manages Rivers State funds, and through which most of the withdrawals were allegedly made, was being detained for several hours by the EFCC in connection with the ‘shady’ deals. It was not clear, at press time, whether the said bank MD was still in the custody of the EFCC or was released.
The EFCC was not forthcoming on requests to get clarifications on the matter. Calls placed to Mr Wilson Uwugaren, Commission’s spokesman were unanswered. The following text message seeking his comment was also sent to him without a reply:
“Good evening Mr Wislon. My name is Hameed Bello, editor of Peoples Daily newspaper. Will like to get some clarifications from you over a story in respect of EFCC probe into Rivers State funds running into N117bn. We hear a bank MD is in your custody too. Thanks for your timely response.”
The Rivers State Governor, Nyesom Ezenwo Wike has said in a reaction yesyerday that no official of the Rivers State Government will appear before EFCC “over her politically motivated investigations until the commission approaches the Court of Appeal to set aside the 2007 Judgment barring the commission from investigating the state.”
In a statement on Sunday, Special Assistant to the Rivers State Governor on Electronic Media, Simeon Nwakaudu quoted Governor Wike as describing tbe alleged action of the EFCC as a “political witch-hunt”.
The governor declared: “We are not afraid of their probe and they have no power to probe us.
“No government official will appear before the EFCC until they set aside the court judgment of Rivers State Government against them in 2007. We cannot be intimidated.
“They filed for leave to appeal the judgment at the Court of Appeal. Until they set aside the judgment, we will not come. “
Governor Wike said that the media trial by the EFCC will amount to nothing, pointing out that the Rivers State Government was aware of the move before it even started.
It will be recalled that while Speaking on the freezing of Akwa Ibom State and Benue State accounts recently at the Government House Port Harcourt , Governor Wike said that the ultimate target of the APC Federal Government is Rivers State, where they have already detailed the EFCC to carry out very unconstitutional activities.
He said: “There is no worse impunity than for the EFCC to shutdown a tier of government through the freezing of the accounts of two State Governments.
“But the target is not Benue or Akwa Ibom States. The real target is Rivers State. The EFCC as a federal agency has no business with State Funds. That is the responsibility of the State House of Assembly “.
He said that Rivers State Government under Former Rivers State Governor, Dr Peter Odili obtained a court judgment that the EFCC has no constitutional power to investigate state funds, pointing out that the EFCC is yet to vacate that order at a superior court.
However, the sources revealed that four suspects have been tracked by the EFCC for interrogation, including the Rivers state Director of Finance and Accounts, Fubara Similari and his cashier whose name was not clear at press time.
According to a source, N10 million withdrawals were made at separate times, and sometimes, as many as 50 cheques were cashed in a day in violation of financial regulations.
This is contrary to the Money Laundering (Prohibition ) Act of 2011, and ‘based on intelligence, the EFCC swung into action’, he said, adding:
“Our findings indicated that the withdrawals were made in cash from the state accounts mostly by one person. There are no records of what the cash were used for, and we are working on tips that they were diverted for money laundering purposes.
“The EFCC has obtained all the records of the withdrawals including the date and time. For example, on June 8, 2015, just a few days after the current state government came into power, about 45 cheques running into N450 million were cashed over the counter. That has not been justified.
“Also, on June 9, 2015, about 50 different cheques were withdrawn to the tune of N500 million. We will soon release details of findings by our team.”
It was gathered that the bank MD in detention has provided the investigators with useful leads that will fast track the investigation. The bank in question “is guilty of Lack of Suspicious Transaction Report (STR) and violation of Money Laundering Act”, a source said.
Accordingly, the Finance Director, Fubara Similari and other top government officials of Rivers State will be invited by the EFCC for interrogation in the second leg of the investigation.
The Money Laundering Act requires financial institutions to step up surveillance where a transaction is suspicious, with a questionable frequency which is unjustified or unreasonable, an expectation which the defaulting bank has believably failed to comply with.
“Where a Financial Institution or Designated Non-Financial Institution suspects or has reasonable grounds to suspect that the amount involved in a transaction is the proceeds of a crime or an illegal act it shall require identification of the customer notwithstanding that the amount involved in the transaction is less than US$1,000 or its equivalent,” the Act specifies.
“A Designated Non-Financial Institution that fails to comply with the requirements of customer identification and the submission of returns on such transaction as specified in the Act within 7 days from the date of the transaction commits an offence and is liable on conviction to – (a) a fine of N250,000.00 for each day during which the offence continues; and
(b) suspension, revocation or withdrawal of license by the appropriate licensing authority as the circumstances may demand.”
On Special surveillance on certain transactions, the Act states as follows:
(1) Where a transaction –
(a) involves a frequency which is unjustifiable or unreasonable;
(b) is surrounded by conditions of unusual or unjustified complexity;
(c) appears to have no economic justification or lawful objective; or
(d) in the opinion of the Financial Institution or Designated Non-Financial Institution involves terrorist financing or is inconsistent with the known transaction pattern of the account or business relationship, that transaction shall be deemed to be suspicious and the Financial Institution involved in such transaction shall seek information from the customer as to the origin and destination of the fund, the aim of the transaction and the identity of the beneficiary.
(2) A Financial Institution or Designated Non-Financial Institution shall within 7 days after the transaction referred to in subsection (1) of this section –
(a) draw up a written report containing all relevant information on the matters mentioned in subsection (1) of this section together with the identity of the principal and where applicable, of the beneficiary or beneficiaries;
(b) take appropriate action to prevent the laundering of the proceeds of a crime or an illegal act; and
(c) send a copy of the report and action taken to the Commission.
(3) The provisions of subsections (1) and (2) of this section shall apply whether the transaction is completed or not.
(4) The Commission shall acknowledge receipt of any disclosure, report or information received under this section and may demand such additional information as it may deem necessary.

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