Mr. Lamido Sanusi, has described the allegations of
financial recklessness levelled against him by the
Financial Reporting Council of Nigeria as a malicious and
calculated attempt to mislead President Goodluck
Jonathan into believing that the management of the bank
is guilty of misconduct and recklessness.
In what can be described as his first official response to
the allegations, Sanusi, in a letter to Jonathan, said that
contrary to the claims by the Presidency that he was
asked to respond to issues raised in the FRCN report, he
only saw the "Briefing Note" of the council for the first
time when it was attached to his suspension letter.
In the letter, sent to the President on March 10, a copy of
which was made available to journalists on Sunday, the
suspended governor said at no time were the allegations
in the report sent to the CBN either by the President or
the FRCN for comments or explanations.
He said, "On Wednesday March 10, 2014, I submitted a
memorandum to His Excellency, Mr. President, with
supporting documentation, effectively addressing all the
allegations contained in the FRCN Briefing Note, the
letter of suspension and the Akingbola petition.
"Having submitted my response to the President, I am
further compelled, following the recent press briefing
and comments by the Senior Special Adviser to the
President on Media as well as numerous other references
to the allegations in both local, international and online
media, to put to the public my responses in the interest
of transparency, accountability and my responsibility to
the Nigerian people.
"Let me also state that I saw the FRCN Briefing Note for
the first time when it was attached to the suspension
letter. At no time was this report sent to the CBN either
by the President or the FRCN for comments or
explanations.
"A careful examination of the allegations contained in
the FRCN Briefing Note to Mr President, will show that
each of the allegations could easily have been resolved
by a simple request for clarification or more careful
review.
"There is no doubt that if the CBN had received the
Briefing Note, which was prepared in June 2013, all the
misconceptions, misrepresentations and erroneous
inferences contained therein would have been cleared.
"I am publishing these responses to enable the general
public see that each and every allegation levelled
against the CBN under my leadership is false and
unfounded, and that many of the allegations were
malicious and fabricated, having been designed to
mislead the President into believing that the
management of the central bank was guilty of
misconduct and recklessness."
On the allegations of fraudulent takeover of the defunct
Intercontinental Bank Plc by the former Managing
Director, Mr. Erastus Akingbola, Sanusi described them
as baseless.
He said, "As for the Akingbola petition, it is a rehash of
the baseless allegations he has been making since 2010,
which apparently he must have been asked to reproduce
on February 9, 10 days before the suspension.
"It is, indeed, strange that the CBN governor can be
suspended based on allegations written by a man who
ran his bank into the ground and against whom
judgement has been obtained in a London court, and
who furthermore is facing criminal prosecution at home
for offences, including criminal theft."
The governor, in providing specific responses to all the
allegations levelled against him and the central bank
management, faulted all the claims by the FRCN in its
report.
For instance, on the allegation of weak corporate
governance at the CBN on account of the fact that the
office of the governor is fused with that of the Chairman
of the Board of Directors, Sanusi said the FRCN ignored
the fact that global best practice was that the governor
of the central bank was also the chairman of the board.
This, according to him, is currently the practice in about
55 countries.
On the allegation that the CBN's breakdown of "Currency
Issue Expenses" for 2011 and 2012 indicated that it paid
the Nigerian Security Printing and Minting Plc N38.233bn
in 2011 for printing of banknotes, whereas the entire
turnover of the company was N29.370bn, the suspended
governor said the expense item of N38.233bn comprised
N28.738bn payment to the NSPMP in 2011; N6.587bn
accrued liability in 2011 but paid in 2012 when deliveries
were received; and N2.829bn audit adjustment journal
entry into the account at the end of 2011 in respect of
prepayments to the company.
"Evidently, the difference between the numbers in the
financial statements of the CBN and NSPMP is a simple
reflection of timing differences between recognition of
expenses by the CBN and income recognition by the
NSPMP, with both entities applying conservative
accounting policies," he added.
On FRCN's claims that the CBN made fictitious payments
of N511m to Emirate Airlines, which allegedly is not
operating local charter in Nigeria; N425m to Wing
Airlines, which allegedly is not registered with the
Nigerian Civil Aviation Authority; and N1.025bn to
Associated Airlines, which allegedly did not have a
turnover of up to N1bn in 2011, Sanusi replied, "The CBN
neither engaged, paid nor claimed to have paid Emirates
Airlines.
"Rather, the CBN engaged and entered into an Air
Charter Services Agreement with Emirate Touch Aviation
Services Limited, which is a local Nigerian charter
service company.
"A simple enquiry by the FRCN would have clarified and
avoided this misrepresentation. With respect to Wings
Aviation Limited, the CBN contracted Wings Aviation
Limited, which changed its name to Jedidiah Air Limited
on August 21, 2009, but only notified the CBN of the
change on February, 28,2012.
"With respect to Associated Air Limited, the CBN did in
fact pay a total of N1.025bn to Associated Airlines
Limited. It is worth stating that the CBN is not
responsible for how the company reports its turnover."
Responding to the allegation that the CBN's expenses on
private guards and lunch for policemen went up from
N0.919bn in 2011 to N1.257bn in 2012, he said that in
2007 before he assumed office, the CBN adopted a policy
to outsource non-core functions, including security
services.
This decision, he added, enabled the bank to focus on its
statutory mandate and to reduce its overheads.
He said, "Accordingly, the CBN retained the services of
about 13 private security companies to provide access
control and security check services.
"In 2012, the CBN budgeted N600m for security services,
but spent N582.2m on private guards.
"To complement the efforts of the private guards, the
CBN also requested the services of security agencies in
the light of the increased security challenges, especially
the activities of the Boko Haram terrorist group.
"These security personnel were engaged on a daily basis
and were attached to senior CBN officials; special
assignments such as security coverage for currency
movements; static guard duties at the bank's premises
nationwide and other sundry engagements.
"About 2,406 policemen are currently deployed on a
daily basis to various branches and other locations of the
CBN.
"These security personnel were paid a daily lunch and
transport allowances totalling N675.02m in the year
under review."
In replying to the allegation that the CBN paid excessive
legal and professional fees totalling N20.202bn in 2011,
Sanusi said the bank, like any other public entity, was
not immune from liabilities arising from judgments and
orders of courts.
"The referenced N20.202bn spent under this head
covered the CBN's judgment debt liabilities in the year
under review.
"Of particular reference is the judgment of the Supreme
Court in the case of Amao vs the Central Bank of Nigeria
(SC 168/2007) delivered on May 21, 2010, wherein the
apex court directed that the CBN pay employees of the
bank, who had retired prior to 2000, pension under the
harmonised structure introduced by the Federal
Government.
"Note that the negotiated litigation liability that arose
from the above specified matter was approximately
N19.8bn."
The suspended governor, in his submission, urged the
President to "revisit and redress the issue of my
suspension."
He also called on Jonathan to apply the same rationale
and rigour to other agencies of the Federal Government
that have had serious allegations and queries levied
against them and prevail upon them to provide
responses and explanations with the same level of clarity
and transparency as he had done.
Source: The Punch
Sent from my BlackBerry® smartphone provided by Airtel Nigeria.
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