EFCC freezes N8. 6 billion in three accounts owned by billionaire business woman, Bola Shagaya

The Economic and Financial Crimes Commission (EFCC) has frozen over N8, 627,458,773.36 billion in three accounts of billionaire businesswoman and an associate and friend of former First Lady, Mrs. Patience Jonathan, Bola Shagaya, at Unity bank. According to the Nation, the anti-graft agency is currently investigating the link between Hajia Shagaya and about 10 firms/account. 

The billionaire business woman who did not hold any public appointment during the administration of former President Goodluck Jonathan, has dragged Unity Bank to the High

Court of Lagos State for allowing the EFCC to Post No Debit (PND) on her accounts without a valid court order. According to Hajia Shagaya, the action taken on her accounts violates Section34 (1) of the EFCC Act, 2004.

 According to documents which Shagaya filed and deposed to at the Court by her counsel, Napoleon Emeaso-Nwachukwu, the withdrawal ban placed on one of her accounts has prevented her from defraying N514, 800,000 incurred as cumulative costs in the course of an Aircraft Lease Agreement of a Bombardier Jet

However, Unity Bank says its hands are tied by the law in complying with the EFCC’s directives to freeze Shagaya’s accounts.

The EFCC in a letter to the Unity Bank Managing Director in respect of one of the frozen accounts said: “The commission is investigating a case in which the above-mentioned account featured. In view of the above, you are requested to kindly check the table below and provide us with Certified True Copies (CTC) of the following information, which should include but not limited to the following: (i) The deposit slips/telex copies (front and back) that conveyed the authority of the transactions; (ii) Any investment made with the funds in any of your products which should include fixed/term deposit and their liquidation and the interest incurred, Banks Acceptance, Commercial Papers and any other relevant information in relation to these". 

The EFCC listed the transactions in the said account as “N300m(Bola Shagaya RTGS);  N300m (Additional N300FTD at 15% TRAN); N500m (Time Deposit); N2,317,013,698.64 (BNG COLLAOS FOR FTD-CUSTOMER ACCOL); N2.3billion (Opening a Time Deposit Account); N292, 495, 029.82 (Withdrawal from Time Deposit); N292, 495, 029.82 (TAK Asset Mgt Limited); N300m (Term Loan booked for 356 days); and N2,025,455,015.08 (BNG COLLAPS OF FTD Customer Account.”

In a separate letter Cr: 3000/EFCC/LS/STF/ STF3MP/ Vol.11/182 which Shagaya made available to the court, the EFCC asked Unity Bank to Post No Debit(PND) on 10 accounts linked with her.  The account names are (i) First Deep Water Discovery Limited; (ii) Bola Shagaya; (iii) FAPLiNs Nigeria Limited (iv) Lingo Nigeria Limited; (v) Buri Barclays BDC; (vi) Links Global Synergy Ltd; (vii) OKIOIL Nig. Ltd; (vii) JEMARVIZ Nig Ltd; (ix) PJ Oil and Gas Ltd; and (x) AFDIN Ventures Ltd.

The anti-graft commission said: “The commission is investigating a case in which the above mentioned accounts featured. You are requested to kindly place the account on Post No Debit (PND) category pending the conclusion of the investigation. This request is made pursuant to Section 38(1) and (2) of the Economic and Financial Crimes Commission (Establishment) Act, 2004 and Section 21 of Money Laundering (Prohibition) Act, 2011.”

In the third letter, the EFCC said it was looking into two other accounts including Voyage Oil and Gas and Bola Shagaya from 2008 to date.

It said: “The commission is investigating a case in which the above mentioned accounts featured. In view of the above, you are requested to kindly provide us with Certified True Copies (CTC) of the following information which should include but not limited to the following: (i) The Mandate Card  and statement(s) of all domiciliary and Naira account(s) in the above mentioned accounts from 2008 to date with letter of certification in accordance with Section 84 of the Evidence Act 2011; (ii) any investment made with the funds in any of your products which should include fixed/term deposit and their liquidation and the interest incurred, Bank Acceptance, Commercial Papers and any other relevant information related to these. You are further requested to kindly place the account on Post No Debit (PND) category pending the conclusion of investigation.”

But Shagaya accused Unity Bank of complicity on her travails following  the bank’s alleged failure to exercise the requisite due diligence.

She said the freezing of her accounts did not comply with Section 34(1) of the EFCC Act, 2004. She specifically referred to the bank’s refusal to allow her to make transactions on Account 000326118 including payment of N514, 800,000 to Global Apex Air Limited, through Heavywind Integrated Services, for the lease of a bombardier Jet.

She said the Aircraft Lease Agreement between her and Global Apex Air Limited has been terminated with her forfeiting US$1million.

In an affidavit she deposed to the court, Shagaya said: “The official of the Defendant (Unity Bank) whom my Personal Assistant relayed the development to, informed him that on the 3rd of November, 2016, the Defendant received a letter from the EFCC through their Lagos office informing it that my account with it is under investigation and requested that the account be put on “Post No Debit” pending the outcome of the investigation hence the Defendant’s inability to honour my payment instruction. Initially I laughed off the excuse as a ploy of the Defendant to deter me from taking legal actions against it for dishonouring my payment instructions especially that of the 31st of October 2016 which ultimately led to the termination of the Aircraft Lease with Global Apex Air Ltd. And the loss of the sum of One Million United States Dollars deposited with the Lessor by me. On the 27th of January, 2017 the Defendant responded to my Solicitor’s letter. In its response, the defendant stated that: “it observed that long before your client forwarded her cheques and payment instruction to the Bank as indicated in your letter under reference, the EFCC had formally informed the Bank that an investigation relating to your client’s account was ongoing and sought the cooperation on the Bank accordingly.” The Defendant’s letter ended by stating that “Based on our understanding and the fact that the Bank was already aware that the Law Enforcement Agency had taken definite steps to comply with Section 34(1) of the EFCC Act, 2004, behoves the Bank not to allow the dissipation or removal funds in your client’s account without appropriate clearance from the Law Enforcement Agency or a judicial order directing the release of the funds to your client. I will also contend at the hearing of this Suit that the Defendant negligently and wrongfully failed to exercise the requisite due diligence and by extension, the duty of care it owed me as my banker prior to complying with the alleged freezing instruction from the EFCC. The Defendant did not request and ensure it was obliged the Freezing Order from a court of competent jurisdiction prior to complying with the instruction to freeze the Claimant’s account. The Defendant failed to honour the Claimant’s payment instructions of the 31st of October 2016 as well as those of the 1st and 2nd November 2016 which preceded the alleged instruction from the EFCC. The Defendant failed to promptly notify the Claimant of the freezing other account. The freezing of the Claimant’s account did not comply with Section 34(1) of the EFCC Act, 2004. Since the unlawful freezing of my account by the Defendant, I have not been able to transact with that account due to my inability to access same thereby causing business losses and opportunities. By reason the Defendant’s action, I have suffered loss of reputation and damages and my person brought to disrepute, public opprobrium and odium. The actions of the Defendant which consist in unlawfully freezing my account without an Order of a Court of competent jurisdiction and failing to disclose same to me promptly was unreasonable as well as defamatory of me before my business associates who now see me as a criminal and an untrustworthy fellow who is in the habit of issuing due cheques and payment instructions that she knew would not be honoured".

She said she had lost a lot of business goodwill since her accounts were frozen including

-   The loss of $1,000,000 deposited with Global Apex Air Ltd. Due to her in ability to pay accrued costs in line with Aircraft Lease Agreement which was occasioned by the failure of the Defendant to oblige the Claimant’s payment instruction to Heavywind Integrated Services.

-    Loss of business opportunities and goodwill occasioned by her inability to operate her account domiciled with the Defendant due to its freezing.

-    Loss of reputation occasioned by the Defendant’s wrongful dishonouring of her payment instructions to third parties.

“If not compelled by this Court, the Defendant will not on its own volition unfreeze my account even when it is glaring the Defendant had wrongfully breached the duty of care it owes complying with an illegal instruction in freezing my account.”

But in a letter to Shagaya’s counsel, Unity Bank said it has a legal and ethical responsibility to render assistance to law enforcement agencies. The bank explained its constraints in a letter by its Head, Legal Services Department, Mr. Alaba Williams and Mr. Olusegun Olukoya of the same department. Part of the bank's letter reads

“While the Bank respects the contractual nature of the relationship with your client, it is without prejudice to the Bank’s standing as a responsible law abiding Corporate Citizen. In spite of the Bank’s contractual relationship with your client, that relationship is not without a legal and ethical responsibility to render assistance to law enforcement agencies when required of the Bank. Considering the sensitive nature of the investigation touching your client’s account as advised by the EFCC in October 2016, the Bank had to exercise caution in relation to further transactions, especially debits, in the account of your client under investigation. The need for the Bank to exercise due caution in the matter of the operation of your client’s account after receipt of notification of the ongoing investigation by the EFCC was informed by our understanding of various existing statutory provisions  relevant to the request of the EFCC received by the Bank. Based on our understanding and the fact that the Bank was already aware that the Law Enforcement Agency had taken definite steps to comply with section 34(1) the EFCC Act, 2004. It behoves the Bank not to allow the dissipation or removal of the funds in your client’s account under investigation, before the Court Order seeking to preserve the funds was obtained. The contractual relationship between your client and the Bank does not permit us to pre-empt the investigation by the Law Enforcement Agency and the related Court Proceedings which outcome could lead to forfeiture of the funds in the same account. The Bank could be considered an accessory after the fact if it allowed the dissipation of the funds in your client’s account without appropriate clearance from the Law Enforcement Agency or a judicial order directing the release of the funds to your client. Therefore contrary to the allegation in your letter, the Bank had a proper justification for refusing the payment instructions from your client for funds to be removed from her account in issue when there was an ongoing investigation by the EFCC in respect of the said funds. The Bank is therefore not in breach of any contractual obligation to your client. The Bank is also not liable to your client for the sum of N700,000,000.00 (Seven Hundred Million Naira) or any other sum that matter as damages claimed by you. Please, note that Unity Bank Plc. is committed to comply with the extant laws and Regulations of all competent Authorities and Jurisdictions. In addition to adopting best practices; ethical and legal considerations always guide our commercial decisions protecting the good name and the reputation of the bank remains the primary consideration in all actions taken by the Bank. Accordingly, the Bank protects its products and services from being involved in allegation of unlawful activities. Hence we  will cooperate fully with all Regulators and Law enforcement Agencies. We are of the humble opinion that your client should kindly resolve any outstanding issues with the Law Enforcement Agency and facilitate the removal of the “Post No Debit” on her account with the Bank. Litigation against the Bank will therefore not be necessary in the circumstance.”

Hearing of the matter is slated for September 28.