Crime
Nigerian banks race to join CBN Too-Big-To-Fail (Part III)
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Internal fraud, unabated system breaches due to poor cyber security, banking mass fraud, asset hijacking
With a brand value of $379m (45% increase YoY), 28,000 employees and total asset of over $25bilion Access Bank is biggest and most valuable bank in Nigeria. Though business started 33 years ago (in 1989), Access Bank’s journey to mega status only began in 2012 when it moved from being a solely corporate bank and expanding into personal and business banking. The unprecedented mergers and acquisition that followed, particularly that of Diamond Bank in 2019, has seen the bank grow its total asset from about $9billion to the current $25billion (by 166%) in only 10 years. For context, other fast-growing banks like Zenith Bank only grew total assets by 46%, etc, therefore Access Bank outperformed top players by over 110% (on an average).
Of course, this growth implies the bank has more capacity to mint credit and can make a lot more money from interests. Also, it means that the management of the bank has more depositor’s funds to fond with, and by implication puts them in the precious ‘Too Big To Fail’ class.
Therefore, Access Bank, just like First Bank, GTB, Zenith Bank and UBA, is a major variable in state of our economic health as a nation. Collapse of an Access Bank will have multiplier effects that will touch every single one of us! Remember the dreaded diabolic loop?
Access Bank’s growth has not come without its fair share of challenges, majorly fueled by the elite’s avarice and the owners’ race to beat the competition. Like most other players in the industry and their counterparts in the West, banks hack the financial industry rules in a bid to continue to satisfy, primarily, the shareholders’ interests and other vested interests.
There are so many cases that are linked to Access Bank but we will only examine three:
Fraud: internal and external
When it comes the case of fraud, Access Bank can be termed notorious. From internal fraud cases by employees to sadly, being the leader in the cases of external fraud, Access Bank seem to have out-grown its capacity to keep its coffers safe.
Scammers and hackers have popularly confessed that Access Bank and First Bank accounts seem to be the easiest to compromise. Over the last five years it has topped the list of Nigerian banks with reported cases of fraud, with report putting it at N871m between 2016 – 2021. That even escalated further with a report of N502m lost to fraudsters in the last one year alone!
There are also reports of internal compromise of the system. One that made it to the press is the case of one Elizabeth Modupe Osunjuyigbe, who allegedly, fraudulently diverted funds to the tune of over N34m.
Investigations revealed that the suspect allegedly forged a solicitor’s letter dated January 19, 2021, directing the bank to issue the draft in favour of Best Timland, claiming that the request was for the payment of rent to the landlord of one of the bank’s branches in Akwa-Ibom State.
That speaks volume of the poor internal control measures at Access Bank, which is not so strange given that the management’s focus has been more on growing bigger, rather than stronger.
Herbert Wigwe
Allegations of asset hijacking
Sources close to the internal workings of Nigerian banks have confirmed the wicked practice of bankers grabbing juicy assets that their customers use to collateralise their loans. Someone once dropped a scary joke that “realtors think they can sell prime estates, they should go and learn from Nigerian bankers.” Sad!
There are cases of borrowers whose loans become delinquent for genuine reasons and who continue to engage the bank to restructure and explore options that will save them from losing their key assets. Of course, bankers who are privy to such information go on to inform their major account holders of these sorts of situations, who also stay ready to buy off these assets (with the help of bank staff) once the owners are tussled off them.
The asset hijacking allegations seems to be wide spread in the bank, even up to its highest office.
In 2019, former Access Bank managing director, Herbert Wigwe, and eight others were arraigned before a Lagos High Court, Ikeja by the Special Fraud Unit of Nigeria Police over allegation of $6.3 million fraud. The case was stalled “due to absence of some the defendants”.
It was reported then that Wigwe, now the Group managing director/CEO of Access Holdings Plc, was standing trial along with Cast Oil and Gas Ltd, Seyi Sanni, Adekunle Adebayo, Access Bank Plc, Titi Oshontoki, Chinyere Bishop-Adigwe, Sunny Amos Affiong and Augusta Energy Nigeria Ltd for allegedly defrauding former Petroleum Minister, Chief Don Etiebet, through his company, Top Oil and Gas Development Ltd.
The police in a four-count charge alleged that the defendants and Augusta Energy of Geneva Switzerland (still at large) between January and December 2015, in Lagos, fraudulently induced Top Oil and Gas Development Ltd, to invest about $6.3m in the supply of a 10,000 metric tonnes of Automative Gas Oil, Ago.
Wigwe’s lawyer, Paul Usoro, SAN, however, informed the court of a pending application dated April 30, 2019, he filed on behalf of his client challenging the jurisdiction of the court to determine the matter. The usual “technical justice” game lawyers play to perpetually keep cases in courts.
Unfortunately though, character is like a smoke, and more cases jumped out of the box.
The Police Special Fraud Unit again, now in Ogun State High Court, charged Herbert Wigwe with 21 counts of conspiracy and stealing.
Wigwe, Alawode Oluseye, Bayo Adesina, and Access Bank Plc are accused of conspiring and stealing 23,754.413 metric tonnes of steel billets valued at ₦2.5 billion belonging to BMCE Bank International Plc.
The alleged crime took place in June 2017 at the premises of Metal Africa Steel Products Limited along Sagamu/Ikorodu road, Ewe Jagun, in Ogun State, the police said.
According to the police, the defendants falsely presented themselves as the owners and sold the steel billets to Metal Africa Steel Products Limited without the authorisation of the actual owner.
The police said the defendants forged the Bill of Ladings number: MJINLOS150007’1A’; MJINLOS150007 ‘1B’; MJINLOS150007 ‘1C’; MJINLOS150007 ‘2A’; MJINLOS150007’2B’; MJINLOS150007 ‘2C’; MJINLOS150007 ‘2C’; MJINLOS150007 ‘2D’; MJINLOS150007 ‘2E’; MJINLOS150007 ‘2F’; MJINLOS150007 ‘2G’; MJINLOS150007 ‘2H’; MJINLOS150007 ‘2I’; MJINLOS150007 ‘2J’; MJINLOS150007 ‘2k’; MJINLOS150007’2L’ and MJINLOS150007’2M’, which they claimed were issued on January 9, 2016.
On this particular case it was reported later in 2019 that Wigwe and Access Bank may be settling out of court. This may have held too much stormy waters for them; a better idea would be to make it go away!
The questions are:
- Is the case not beyond civil?
- The criminal charge of forgery is with the state not the plaintiff?
- Has the CBN launched its own investigation (and made findings public) on this sharp practice by an institution it is supposed to monitor and regulate?
Maxwell Odum
Abetting mass fraud: MBA Forex/Maxwell Odum N213billion fraud and the role of Access Bank Plc
When the Economic and Financial Crimes Commission declared Maxwell Chizi Odum wanted for fraud amounting to N213billion, the questions that came to most people’s mind were; who were his bankers? How could he have evaded the scrutiny of SFU, the Nigeria Financial Intelligence Unit (NFIU) and other very stringent anti-fraud/anti-money laundering blocks of the government? Who facilitated the evacuation of the funds even after he was placed under investigation?
There is only one answer, and its simple.
N213bilion is almost five times larger than CBN’s minimum capital reserve of an International Commercial Bank practice in Nigeria. Banks like Access Bank, who ran Odum’s major collection accounts, had all the motivations to encourage his illicit business to flourish. Even more, there are allegations that top staffers were key beneficiaries of the scheme.
Maxwell Chizi Odum masterminded the biggest ponzi schemes ever conceived in Africa.
Like it happens so frequently in Nigeria, few people cared to inquire as to how a Pentecostal preacher without a strong expertise in economics or investments allegedly discovered an investment strategy that would make them obscenely wealthy. All they observed was that other individuals invested money in this thing that was popularly known as MBA Forex, and they emerged with incredible double-digit returns using an investing strategy that was much too complex for anybody to truly comprehend, even if they tried.
It was a ponzi scheme, as one would expect, quite similar to MMM.
According to Nigerian law, soliciting and accepting monetary deposits from the general public is considered doing banking activity and necessitates a banking license from the CBN. Additionally, the commercial promotion of any assets that guarantee fixed interest rates for money deposited for certain periods of time is a carefully regulated activity that is directly under the Securities and Exchange Commission’s jurisdiction (SEC).
MBA Forex was engaging in both of these regulated operations while holding no official authorisation from any regulatory body. MBA Forex was actually a wholly unlawful enterprise, except from its registration with the Corporate Affairs Commission (CAC), which pretty much anybody with a pulse and a valid ID can accomplish without any type of regulatory attention.
MBA Forex differentiated itself from MMM by openly accepting funds into the corporate accounts it was somehow able to open at Access Bank, Ecobank, FCMB, First Bank, GTBank now GTCO, Sterling Bank, Sun Trust Bank, UBA, Unity Bank, Union Bank, and Zenith Bank – despite having exactly zero CBN and SEC authorisation. MMM tried to conceal its centralised nature by using individual bank accounts. The plot becomes more engaging at this point.
Then the clean-up game came with The World Citizen Equity Partners Limited firm. A few days after MBA Forex registered on March 14, 2018, this firm, which purports to be a British corporation that arranges citizenship-by-investment for affluent people, registered in Nigeria on March 21, 2018. The screenshot below refutes WCEP’s later assertion that it had nothing to do with MBA Forex until December 2020.
Remember this since it will be crucial later.
In August 2020, Maxwell Odum moved 100 million of his MBA Forex shares to WCEP, which led to some renowned investors investing in the Ponzi scheme.
Former members of the House of Representatives and a former Nigerian ambassador to the European Union (EU) and African Union (AU), respectively, are the two persons named in the share transfer paperwork. It is still unknown why Hon. Ahmed Aliyu Wadada and Ambassador Usman Baraya chose to invest in a ponzi scam.
In December 2020, MBA Forex suffered the same fate as many ponzi scams, leaving thousands of Nigerians in despair as their hopes of becoming wealthy vanished. Court rulings and regulatory steps to freeze accounts and potentially repay investors started to come in over the next weeks and months. The focus of the inquiry was Access Bank, which had housed the majority of the cash amassed by MBA Forex and Maxwell Odum.
Access Bank, however, made the decision to downplay the genuine part it played in encouraging the Ponzi scam. The bank claimed in a sworn declaration submitted by its lawyer that it had immediately closed all the wrongdoing accounts and that, in any event, the primary MBA Forex account only had a little over N200,000 remaining in it. Access Bank also lied under oath, claiming that World Citizen Equity Partners (Respondent 10) never had an account with the bank, in an effort to conceal the crucial role it played in allowing Maxwell Odum to escape punishment for the scheme.
This version of events was flatly refuted by an affidavit signed by Dickson Ukaha, a former customer relationship manager for Access Bank in Port Harcourt. In his sworn evidence, Ukaha said that months prior to the alleged sale by Maxwell Odum, many transactions totaling hundreds of millions of naira—the kind that would typically set off every bank’s AML alarm—had been made from the MBA Forex account to the WCEP account.
See pictures below:
Just for confirmation, try to make a transfer (try, not actually make) into Access Bank account 1241618171 (the very account stated in the former Access Bank staff, Mr Dickson Ukaha sworn affidavit that it exits), World Citizen Equity Partners Limited will pop up!
So we have a bank that deliberately allowed an unlawful investment scheme to defraud consumers of billions of naira without CBN or SEC licences, and then lied under oath to conceal the depth of its role in the MBA Forex mess after that!
On to the next on; Wema Bank.
The EFCC has arrested seven suspected internet fraudsters in Benin City, Edo State, following credible intelligence. The suspects were found with luxury items, laptops, and phones
Operatives of the Benin Zonal Directorate of the Economic and Financial Crimes Commission (EFCC) have arrested seven suspected internet fraudsters in Benin City, Edo State.
The arrests were made based on credible intelligence about their alleged involvement in internet-related fraud.
Items seized from the suspects include one Lexus car, laptops, and mobile phones. EFCC’s spokesman, Dele Oyewale, confirmed the arrests and stated that the suspects would be charged to court once investigations are completed.
This arrest is part of the ongoing efforts by the EFCC to combat cybercrime and fraudulent activities in the region.
Nine dead and 21 injured in a tragic road crash in Katsina after a trailer carrying cows and humans fell. FRSC urges safer practices.
The Federal Road Safety Corps (FRSC) has confirmed that nine people have died, and 21 others have sustained various injuries in a tragic road crash in Dankama, Kaita Local Government Area, Katsina State.
The incident occurred when a trailer carrying both cows and humans on top became separated from its main body and crashed onto a pavement.
According to FRSC’s Sector Commander, Mr. Aliyu Ma’aji, the driver of the trailer was attempting to avoid hitting a woman who had fallen from an overloaded Golf car carrying beans. The woman’s fall had resulted in the car losing control.
In a statement issued by the FRSC’s Public Relations Officer, Shamsudeen Babajo, Mr. Ma’aji explained that the driver’s efforts to prevent the collision caused him to lose control, leading to the trailer’s detachment and subsequent crash.
As a result, nine people tragically lost their lives, while 21 others were injured. The injured victims were rushed to the Primary Healthcare Center in Kaita for initial treatment, with some referred to Katsina General Hospital and the Federal Teaching Hospital due to the severity of their injuries.
This incident has raised serious concerns over the practice of carrying passengers and animals in overloaded vehicles.
The FRSC Sector Commander urged both drivers and passengers to avoid such dangerous practices, stressing that overloading and recklessness are major contributing factors to road accidents in the region.
Mr. Ma’aji further called on passengers to actively report instances of overloading and unsafe driving practices in order to reduce the number of road traffic incidents.
EFCC launches an internal crackdown with 10 officers detained over theft and corruption allegations, marking a critical test of its accountability.
The Economic and Financial Crimes Commission (EFCC) has initiated a dramatic internal crackdown, detaining 10 officers from its Lagos Zonal Command over serious allegations of theft and corruption.
This bold move, ordered by EFCC Executive Chairman Mr Ola Olukoyede, signals the Commission’s commitment to tackling internal misconduct and ensuring accountability within its ranks.
The officers were apprehended last week and are currently being interrogated regarding the disappearance of several unaccounted-for operational items. The situation has sent shockwaves throughout the EFCC, which has long been regarded as a leading force in the fight against corruption in Nigeria.
Sources close to the investigation suggest that the case has captured significant public attention, casting a spotlight on the EFCC’s internal operations and raising questions about its ability to police itself.
“Investigators are making good progress,” an insider revealed, adding that anyone found guilty will face stringent internal disciplinary measures.
The unfolding scandal presents a crucial test of the EFCC’s resolve in upholding its own standards of accountability. As an institution tasked with eradicating financial crimes and corruption in Nigeria, the EFCC’s credibility is now on the line as it battles to preserve its reputation while addressing these internal breaches.
This incident serves as a stark reminder of the importance of self-regulation and integrity, even for those entrusted with the task of enforcing the law.
The public and officials alike are closely watching how the EFCC navigates this controversy, as the Commission continues to scrutinise its operations and ensure that all its officers uphold the highest standards of ethical conduct.
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