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Judiciary’s role in battle against graft
Lagos lawyer WAHAB SHITTU, in this piece, highlights the 2018 achievements of the Economic and Financial Crimes Commission (EFCC) and points out the role of the judiciary in the battle against corrupt men.

The Economic and Financial Crimes Commission under the watch of its Acting Chairman, Mr. Ibrahim Magu, has been posting unprecedented record of achievements in terms of convictions of those who are standing trial over corruption related matters.

Last year alone, as at December 31, 2018, the EFCC secured 312 convictions by various zones of the EFCC judging by records from different courts nationwide.

It is instructive to note that the record of such convictions include high profile convictions significantly the celebrated convictions of the former Governors of Taraba and Plateau States, Rev. Jolly Nyame and Joshua Dariye respectively. The two ex-governors are now serving their prison terms in Kuje Prisons, Abuja.

The conviction of the former Executive Chairman of Ogori Magongo, Mr. Gabriel Daudu affirmed by the Supreme Court early in the year has raised significant jurisprudential contribution which is the thrust of this paper.

Remarkably, in the celebrated case of Gabriel Daudu vs FRN (2018) 10 NWLR (Pt.1626) 169, 183 E-F (2018) LPELR – 43637 (SC). The Supreme Court made the mother of all pronouncements on burden of proof in corruption cases. The apex court held:

“The burden lies on an accused person to explain properties he acquired which are disproportionate to his KNOWN legitimate earnings.”

The implication of this judgment is that once it is shown that you have much more than you should have had, then it is yours to explain the source of such wealth. This is a major contribution by the judiciary particularly the Apex Court to the war against corruption. This is consistent with international standards and best practices including recent legislations in civilized jurisdictions around the world.

The Supreme Court’s pronouncement is significant because Prosecution of proceeds of crime in Nigeria is a heavy burden mainly because of the requirement that criminal cases must be established beyond reasonable doubt. Burdens and standards of proof in criminal proceedings in possession of unexplained property prosecutions particularly in the context of assets in excess of legitimate earnings is a heavier burden because of uncertainty of who bears what burden, for which facts the burden is applicable and the required standard of proof to deliver successful prosecutions.

Against the background of the recent Supreme Court case in Gabriel Daudu v. FRN, there is the need to ask pertinent question- whether in the light of statutory provisions including Section 19(2) of the Money Laundering (Prohibition) Act 2004 legislating against possession of pecuniary resources which the defendant cannot satisfactorily account for and which is disproportionate to his known sources of income, the development can be said to have raised the bar higher in the fight against corruption by criminalizing assets in excess of legitimate earnings in Nigeria.

The recent Supreme Court decision in Gabriel Daudu v. FRN has progressively impacted on burdens and standards of proof in money laundering cases particularly with respect to assets in excess of legitimate earnings.

Honourable Justice Akaahs in GABRIEL DAUDU v. FEDERAL REPULIC OF NIGERIA highlighted the challenges of burdens and standard of proof in money laundering cases when His Lordship observed as follows:

Proving Money Laundering cases is a herculean task because it requires a prior establishment of the predicate offence before the money laundering aspect can be established. To obviate this problem a remedy was introduced by statutorily inferring money laundering from not only the conduct of the defendant but his lifestyle which is similar to the Proceeds of Crime Act 2002 of the UK. Even though Section 36(5) of the 1999 Constitution (as amended) provides that every person charged with a criminal offence shall be presumed to be innocent until he is proven guilty, the proviso allows for shifting the burden of proof on the defendant. The Section provides thus:- “36(5) Every person who is charged with a criminal offence shall be presumed innocent until he is proved guilty provided that nothing in this Section shall invalidate any law by reason only that the law imposes upon any person the burden of proving particular facts”.

By Section 19(3) of the Money Laundering Act, if an accused person is in possession of pecuniary resources or property which is disproportionate to his known source of income, or he obtained an accretion to his pecuniary resources or property, the burden of giving a satisfactory account of how he made the money or obtained the accretion shifts to him. The prosecution is relieved of the burden of having to prove that the money so found in his account or in his possession is proceeds from illicit traffic in narcotic drugs or psychotropic substances or of any illegal act. To explain the point further, where A is a fixed salary earner and suddenly his account is credited with an amount beyond his income or has property which his legitimate income cannot afford, the burden shifts to him to explain how he got the money with which he bought the property or the legitimate transaction he was engaged in for which the account was credited.” Per AKA’AHS, J.S.C. (Pp. 13-14, Paras. B-E)

The implication of the judgment is that as a result, criminalization of illicit enrichment including assets in excess of legitimate earnings will ease the burden of proof on the prosecution in establishing such offences and facilitate criminal forfeiture of possession of unexplained property as a critical anti-corruption fighting tool.

Significantly, the Supreme Court pronouncement is consistent with recent legislations emanating from the United Kingdom. The United Kingdom (UK) has introduced a new law in tackling corruption. The law – under the law called Unexplained Wealth Orders Regulations, it is now mandatory for the owner of property worth over £50,000 to explain beyond reasonable doubt the source of the property or risk its forfeiture.

The development has now shifted the burden of proof to the defendant, rather than the old order of the defendant being presumed innocent until proved guilty. It is remarkable to state that the Supreme Court upheld the judgement of the high court and Court of Appeal on the conviction of Gabriel Daudu and insisted that those who acquire property and assets beyond their income must explain the source of such wealth or acquisition.

Clearly, the Gabriel Daudu and FRN’s case may have given judicial approval to statutory provisions contained under Section 19(2) of the Money Laundering (Prohibition) Act 2004, Section 15(a)(b) of Advance Fee Fraud and other Fraud Related offences Act 2006 and section 18(5) of the Economic and Financial Crimes Commission (Establishment Act) 2004 respectively; It represents a bold restatement of the law on the element of burden of proof in money laundering cases, particularly the fact that the evidential burden shifts to the defendant to explain the source of funds in excess of legitimate earnings standing in his account. This no doubt may have lessened the burden on the shoulders of prosecutors charged with the responsibility of prosecuting these cases.

A direct implication of the Supreme Court pronouncement is that the burden of establishing that the funds/assets are in excess of the legitimate earnings of the defendant still remains with the prosecution and this must be proved beyond reasonable doubt. Subsequently, having established the excess funds/assets beyond legitimate earnings of the defendant, the burden shifts to the defendant to explain the source of such earnings to the satisfaction of the court.

In the words of Professor Adedeji Adekunle, the significance of forfeiture in modern times, as a substantive penal measure is more noticeable in relation to its deterrent and destabilizing effect on criminals or crime organisations. If in addition to conventional penal measures like imprisonment, punishment is able to strike at the motivating factor of the crime – the financial benefit – it is likely to discourage many persons from committing such crimes. Invariably crimes that are financially motivated involve a deliberate calculation of risks and benefits by the offender. Where the risk of detection includes also the risk of losing the benefit, it is argued that this would sufficiently deter criminals. Some jurisdictions have increased the stakes significantly by extending forfeiture to circumstances where criminal trial does not take place and also to any asset which is not necessarily derived from the crime of conviction. The justification for this obviously is that there is greater deterrence value in expanding the net of assets at risk of forfeiture in the event of detection.

Secondly, beyond deterrence tool, forfeiture is of strategic importance in criminal law enforcement as a substantive weapon for tackling and weakening crime particularly where it occurs in an organized form. The importance of money to organized criminal activities is graphically described thus:

Just as money is the life blood of legitimate business and industry, so too, is it the life blood of all domestic and international organized crime groups regardless of the criminal activity giving rise to the proceeds. It flow through the international banking system is what sustains the illicit operations by providing the criminal with the constant source of new capital needed to pay operating expenses and to buy goods and services.

A deliberate systematic policy of seizing money and identified assets of criminals deprives organized criminal activity of crucial funds essential to its operations.

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It can be argued that in Nigeria and on the strength of the recent Supreme Court judgment in Gabriel Daudu v. FRN assets acquired in excess of legitimate earnings will constitute a crime giving rise to the liability of criminal forfeiture depending on several variables. First, the nature of the forfeiture proceedings is essential to such determination. Forfeiture proceedings are in variety. I. Non-conviction based asset proceedings are civil in nature being action in rem. The penalty therefore in such proceedings is on the property and not the defendant. This proceeding cannot be said to occasion criminal consequences on a defendant except on his/her property. However in a sense forfeiture of the property of the defendant without trial and where the defendant is not available under non-conviction based forfeiture can be argued to amount to criminalizing of the property, the proceeds of crime. Where the forfeiture relates to conviction based forfeiture proceedings, the result is criminalization of not only the defendant but the proceeds of the crime. Proceeds of crime in this sense including but not limited to perishable assets, and assets of diminishing value, petroleum products (PMS, Gasoline, hydrocarbon), vehicles, mechanically and electronically propelled vessels including conveyance by air, sea, road, rail and space, crops, livestock and foodstuffs, cash in hand, cash in a bank account, going concerns, real estates amongst others. Any of these assets in excess of legitimate earnings could be subject of either non-conviction based forfeiture or conviction based forfeiture.

Adjunct to the above, there are sufficient justifications for criminalizing illicit enrichment including assets in excess of legitimate earnings. One justification is that illicit enrichment has been defined in various international and regional anti-corruption instruments including UNCAC which defines it to mean ‘a significant increase of the assets of a public official that he or she cannot reasonably explain in relation to his or her lawful income’. It also explicitly included the requirement of intention (mens rea) for the crime to be committed. Apart from UNCAC, no regional anti-corruption conventions as well as domestic laws require intention as an element of illicit enrichment. In addition, the scope of UNCAC seems restricted to the wealth of the public official while the AU Convention transcends such limitation by including the term ‘any other person’. This term was incorporated because assets can be transferred easily to third parties who are affiliated with public officials in one way or another. It is also instructive as further justification that consistent with Section 19(2) of the Money Laundering Act disproportionate wealth and failure to justify the legitimacy of the source of the alleged wealth are the elements of the offence of illicit enrichment under the definitions.

The other justification may have arisen from the fact that illicit enrichment is shrouded in secrecy, which creates difficulties for its detection and investigation. However, property in the hands of public officials and their families that are manifestly in excess of their legitimate income would be relatively easy to detect, investigate and prosecute. The extreme difficulties in obtaining evidence to prove bribery and other related acts of corruption demand a consideration of the criminalization of a significant increase in the property of public officials. Therefore, the inclusion of the offence of illicit enrichment in the list of crimes of corruption is perceived to be an effective way of combating corruption.

Based on the foregoing reasons, there is no doubt that it is absolutely necessary to criminalise illicit enrichment including but not limited to unexplained property and assets in excess of legitimate earnings. Criminalisation of such offences has advantages because it is associated with the standard of proof for conviction. The prosecutor is required to prove beyond reasonable doubt the disproportionate assets in the hands of the defendant in relation to his legitimate income. One advantage of this requirement is that the prosecutor is not required to prove bribery or any form of corruption to succeed in the case, the prosecutor only obligation being to show that the since the wealth is not proportionate to the legitimate income of a public official it is presumed to have originated from corruption unless the contrary is proved. This may have eased the burden of proof on the prosecution.

The advantages of criminalizing illicit enrichment are associated with the standard of proof required for conviction. In prosecuting illicit enrichment as a crime of corruption, the prosecutor should prove beyond a reasonable doubt the disproportionate assets in the hands of the accused in relation to his legitimate income. In this respect, the prosecutor is not required to prove the fact that the accused has received a bribe or committed any other form of corruption. Wealth that is not proportionate to the legitimate income of a public official is presumed to have originated from corruption unless the contrary is proved. In such circumstance, the burden of proof is eased and the prosecutor is not required to prove corruption as a source of the wealth in question.

The reluctance to criminalize illicit enrichment may have arisen out of the debate on human rights issues raised by some writers. It is my view however that the need combat corruption and stolen wealth by corrupt public officials makes such criminalization compelling subject to safeguards to preserve fundamental rights of the citizens.

The point that is being made is that owing to the networks of intricacies involved in money laundering, the need to lower the standard of proof and compel the defendant to also explain sources of funds of doubtful and questionable origins is compelling. This is not likely to be achieved by a strict adherence to the elements of presumption of innocence without shifting of burdens in cases of unexplained property. Any objection?

The proposal above supports this writer’s perspective of the need for criminal forfeiture of assets in excess of legitimate earnings.

It is also proposed that in shifting the burden of proof in money laundering cases, the proof of assets in excess of legitimate earnings in the proceedings must conform with constitutional provisions. Three fundamental steps of compliance with constitutional guarantee on criminal forfeiture include:
- The ability to trace assets subject to forfeiture or proceeds of crime in whatever form;
- The ability to restrain by judicial order, dealings on such assets; and
- Statutory authorization of a judicial body to issue a final forfeiture order over assets that have been restrained or which have been traced.
Based on the foregoing analysis particularly the record of conviction posted by EFCC under Magu’s watch and the recent pronouncement by the Supreme Court in Gabriel Daudu vs FRN, it can be said with sufficient justification that the EFCC and the judiciary in waging war against corruption in Nigeria.

Significantly, the Supreme Court’s radical pronouncement in the case of Gabriel Daudu vs FRN is a major contribution by the apex court to the war against corruption and the judiciary ought to be applauded for handling down this judgment.
January 3, 2019
Battle against illicit financial flows gets more bite in Nigeria
No fewer than 114 companies are on the verge of losing choice properties in highbrow areas, including Abuja, Federal Inland Revenue Service (FIRS) Chairman Tunde Fowler says in a renewed battle against illicit financial flow. The real estate is believed to have become a haven to invest funds siphoned from developing countries. Assistant Editor NDUKA CHIEJINA reviews the measures being taking by the Federal Government curb and possibly to eliminate illicit financial flow in Nigeria.

Africa and Nigeria appears spurred to tackle illicit financial flow. Illicit financial flows (IFFs) are illegal movements of funds or capital from one country to another.

Global Financial Integrity (GFI) classifies “this movement as an illicit flow when the funds are illegally earned, transferred, and/or utilised.

Some examples of IFFs include:
- A drug cartel using trade-based money laundering techniques to mix legal money from the sale of used cars with illegal money from drug sales;
- An importer using trade misinvoicing to evade customs duties, Value Added Tax (VAT), or income taxes;
- A corrupt public official using an anonymous shell company to transfer “dirty” money to a bank account in the United States (U.S.);
- An human trafficker carrying a briefcase of cash across the border and depositing it in a foreign bank; or
- A terrorist wiring money from the Middle East to an operative in Europe.
GFI in its report estimates that in 2013, $1.1 trillion left developing countries in IFFs. “This estimate is regarded as highly conservative, as it does not pick up movements of bulk cash, the mispricing of services, or many types of money laundering.”

Effects of IFFs on

developing countries

It is a fact that $1.1 trillion is a huge amount of money to drain out of developing countries. The 2013 GFI report discovered that “even after accounting for all types of financial flows (both legitimate and illegitimate) — including investment, remittances, debt forgiveness, and natural resource exports —Africa is a net creditor to the world.”

Aside from the damage done to the economies of African countries, “the overall capital outflows, IFFs have a terrible, subversive impact on governments, victims of crime, and society. They facilitate transnational organised crime, foster corruption, undermine governance, and decrease tax revenues” the GFI report said.

What can be done about IFFs?

GFI believes that “the most effective way to limit IFFs flows is to increase financial transparency.”

It believes that developing countries, like Nigeria, should enact policies to among others things, detect and deter cross-border tax evasion; eliminate anonymous shell companies; strengthen anti-money laundering laws and practices; work to curtail trade misinvoicing; and improve transparency of multinational corporations.

Where does the funds end up?

GFI reported that “every dollar that leaves one country must end up in another. Very often, this means that illicit financial outflows from developing countries ultimately end up in banks in developed countries like the U.S. and United Kingdom (UK), as well as in tax havens like Switzerland, the British Virgin Islands, or Singapore. GFI research suggests that about 45 per cent of illicit flows end up in offshore financial centres, and 55 per cent in developed countries.”

This, the report noted, “does not happen by accident. Many countries and their institutions actively facilitate — and reap enormous profits from — the theft of massive amounts of money from developing countries.”

GFI believes that developed countries have a responsibility alongside developing countries to curtail the flow of illicit money.

Global efforts

The United Nations (UN) adopted to fight IFFs in 2015 with a resolve that African countries must have a firm grip on their Domestic Resource Mobilisation (DRM) by strengthening customs, internal revenue agencies and make legislations that curtails IFFs.

As calls for governments to reconsider the tax incentives granted to some individuals and businesses in Nigeria intensified, one of the continent’s tax bodies cited inappropriate use of tax incentives and exemptions as one of the reasons DRM has not been optimised across Africa.

African Tax Administration Forum (ATAF) Executive Secretary Logan Wort made this assertion in Abuja in September 2017 at the third International Conference on Tax in Africa.

Mr. Wort said: “ATAF recognises that some of the key reasons DRM is not optimised across the continent is due to: low savings rate that equals low economic activity; illicit financial flows; inappropriate use of tax incentives and exemptions and weak tax administrative systems and capacities.”

The ATAF, he said, will assist member countries to address these challenges in some broad areas, which he listed as: implementing the basics of any revenue administration such as completing a taxpayer register; functioning audit unit and recovery processes; embedded in legislation that provide certainty; tax base broadening initiatives; improving tax administration capabilities; strengthening tax policy and providing a platform for African countries to voice matters at regional and international level.

Improving tax administration capabilities he noted “means that numerous country programmes and technical assistance missions are aimed at enhancing the capacity of revenue administrations in specialist areas such as detecting and dealing with transfer pricing abuses; exchange of information; development of legislation that closes loopholes that are prone to abuse; the use of compliance risk management practices to ensure optimisation of resources; and to identify areas of revenue leakage and non-compliance.”

The Nigerian onslaught

The DRM is taking a central role in the efforts to tackle IFFs, Vice President Yemi Osinbajo said last year “as donor fatigue is now only too evident.” What he meant was that “free money is drying up and Nigeria now needs to plug all avenues of revenue leakages and boost internally generated revenue.”

Prof Osinbajo noted that VAT, often seen as the tax of the future, needs a review of its processes for effectiveness and efficiency in its administration.

In the area of Corporate Income Tax (CIT), Osinbajo said: “It is in the spotlight as more manufacturing industries take root in the continent, similarly, there is a growing service sector consisting of the financial, telecommunications and real estate sectors.”

As part of efforts to check IFFs out of the country, the Federal Government has hired a leading international asset tracking and investigation agency – Kroll – to trace and track illicit flows and assets from Nigeria to wealthier countries.

Former finance Minister of Mrs. Kemi Adeosun made the disclosure at the Platform for Collaboration on Tax (PCT) Conference at the UN in New York.

Mr. Adeosun said: “The IFFs are driven by the desire to hide illicit wealth, hide the proceeds away from the public eye and law enforcement agencies and also conceal the ways and means by which illicit wealth was created. This makes it difficult to trace the associated money flow.

“As part of open government partnership, Nigeria has included in the national action plan a commitment to establish a public register of beneficial owners. To this end, the Corporate Affairs Commission (CAC), the custodian of Nigeria’s company register, is pursuing relevant amendments to the Companies and Allied Matters Act to comply with global standards.”

Advocating more responsibility on the part of destination countries of IFFs, the minister advised that beneficial ownership registers should be established to allow authorities track money in financial investigations involving suspect accounts or assets held by corporate vehicles.

Besides, she said that Nigeria has signed the Multilateral Competent Authority on Common Reporting Standards, which allows for exchange of financial account information.

According to her, Nigeria is expected to effect the first exchange by 2019 as soon as the domestic legal framework was completed.

Mrs. Adeosun lamented that IFF was a problem that urgently requires global focus and actions towards the realisation of significant developmental progress for Nigeria and other developing countries.

She expressed concern that “developing countries, including Nigeria, collect significantly lower taxes, as a percentage of Gross Domestic Product (GDP), than wealthier states. This is partly because the income and wealth being created, is taken out of the country illegally, without being taxed.”

Quoting the report of former South African President Thabo Mbeki’s High-Level Panel on IFFs, Mrs. Adeosun said Africa loses $80 billion annually to IFFs, with a significant percentage of the loss coming from Nigeria.

As part of measures to tackle IFFs, the minister called for the tightening of Nigeria’s tax codes and tax laws that encourage tax avoidance as well as strengthening of the tax system to make it more efficient.

Why anti-IFF battle must be won

Last week in Abuja, former President Mbeki warned against taking IFF as problem that can be solved exclusively by Africa, stating that the continent needs “the whole world to engage Africa to help her resolve the issues around IFF. Africa needs capacity building and intervention to boost the capacity. Having identified the problem and the nature of the problem Africa now requires the expertise to effectively confront and overcome the menace of IFF.”

Mbeki lamented that “the poor part of the world is subsidising the rich part of the world this has to stop.”

The former South African leader, now serving as United Nations Economic Commission for Africa’s (UNECA’s) High Level Panel on IFFs Chairman, said that Africa loses about $80 billion annually through IFFs.

He said the huge amount came from proceeds of commercial transactions through multinational companies, criminal activities and corruption.

Mbeki said: “Illicit financial flow poses developmental challenges to the continent, in terms of draining hard currency reserve, reduced tax collection, deepening income gap, depleting investment and weakened governance.”

He stressed the need to strengthen institutions like the revenue service agencies, customs services and the legislation to enable them to better tackle incidences of money laundering as well as other forms of IFFs.

Between February 2018 when Adeosun spoke at the UN on IFFs and October of the same year, Federal Inland Revenue Service (FIRS) Executive Chairman Babatunde Fowler shocked the audience when he revealed that Nigeria accounts for 40 per cent of IFF from Africa.

He defined IFF as “a broad term that can be translated into a number of different things but not limited to cross-border laundering of proceeds of crime, funding of terrorism, theft of state assets, private sector bribery and most importantly, the abuse of taxation.”

Mr. Fowler, who serves as ATAF Chairman and United Nations International Tax Experts Committee First Vice Chairman, described the nature of IFFs in Nigeria to include: payments of expatriates staff emolument and remuneration and failure to declare for personal income tax purposes such emoluments to the relevant tax authorities in Nigeria; laundering of funds (often sourced illegally) through real estate transactions to acquire property in choice locations outside Nigeria; Illegal transfer of money out of Nigeria, via unapproved channels; mispricing of goods and services transferred between interrelated locally-based companies and individuals to offshore-based entities and individuals; profit shifting – for instance through excessive interest payments on foreign and locally-sourced loans and mis-invoicing of imports and exports.

FIRS’s strategies of curbing IFFs

Fowler stated that the FIRS had devised strategies to fight IFFs. These strategies, he said, include: transfer of pricing regulation to address tax revenue losses through transfer mispricing of goods and transfer.

He said that the FIRS has put in place transfer pricing regulations in 2012 and established a functional Transfer Pricing Unit focused on ensuring that taxable persons report sales and profits in Nigeria in adherence with globally acceptable standards of arm’s length principle for tax purposes.

Trend analysis to the rescue

FIRS has developed an in-house capability for trend analysis on banking transactions of taxpayers – to provide early warning on transactions that might be a potential for illicit outflow.

Exchange of Information

There must be the establishment of a functional Exchange of Information (EoI) unit in FIRS to oversee an effective system of exchange of tax information with Nigeria tax treaty partners. EoI units also set up at State Boards of Internal Revenue (BIR) to ensure a nation-wide framework for effective exchange of information on taxpayers.

Base erosion and profit shifting

Nigeria joined the inclusive framework on Base Erosion and Profit Shifting (BEPS) in 2016 and committed to implement the minimum standards, as means to improving tax administrative effort to combat erosion of our tax base.

Automatic exchange of information

Nigeria has signed onto the Multilateral Competent Authority Agreement (MCAA) for the automatic exchange of financial account information with other countries. This will ensure that Nigeria shall have international support in identifying and tracing funds illegally taken out tax residents and invested abroad from which they periodically derive passive incomes (interest, dividends, rent, etc.) from sources outside Nigeria.

All these measures aimed at curbing IFFs, Fowler revealed, has led to a boost in revenue generated by the FIRS.

According to him, the total collection of N3, 916.97 trillion from January to September, 2018 is an increase of N1, 019.3 trillion over collection for the same period in 2017.

Benefits of curbing IFFs

Fowler gave a breakdown of the record of debt payments received by the FIRS with the total debt recovered From January 2017 to August 31st 2018 put at N3, 631,949,050. That meant that from November 2016 to December 2017, the total tax collected was N1.9 billion and from January 2018 till date, N1.731 tillion has so far been received.

Other benefits, he said, include: issuance of notification of tax obligation to CIT, non-compliant companies that own properties and identified non-filers for Abuja with 2,672 Demand Notices, 653 those now filing, total payments for Demand Notices for Abuja Properties N2.983 billion.

Interestingly, 114 companies claimed they were unaware of land allocated to them but upon inquiries at the Abuja, Geographic Information System (AGIS), it was discovered that the lands in question were actually allocated to the companies so the matter will be transferred to the Attorney-General to help the FIRS recover these properties since AGIS has confirmed the ownership for all the cases referred to them to belong the companies. With this development, 114 companies might lose their lands in Abuja.

In Lagos, the FIRS issued 5,000 demand notices, 1,346 responses were received from companies, 610 companies made filing and the properties reflected in their books, 189 non-compliant companies have paid and N247 million was the total payment received from companies that made filings which did not reflect in the ownership of the property.

In his presentation on IFFs, Presidential Advisory Committee Against Corruption (PACAC) Executive Secretary Prof Bolaji Owasanoye said: “Africa is a recipient of IFFs, there are tax havens in Africa, we need to challenge African countries that take part in IFFs.

“There is the issue of South-South Illicit Flows – that is money leaving Nigeria but not leaving Africa. We need to challenge ourselves to know if we are making progress or not. The Mbeki report should be blunt not politically correct.”
October 11, 2018
Battle for Akwa Ibom State House

The die is cast between the ruling Peoples Democratic Party (PDP) and the All Progressives Congress (APC) in Akwa Ibom State. Governor Udom Emmanuel is the PDP flag bearer in next year’s governorship election. His likely challenger is the Managing Director of the Niger Delta Development Commission (NDDC), Dr. Nsima Ekere, who has been unanimously endorsed as the All Progressives Congress (APC) candidate. Who wins? Group Political Editor EMMANUEL OLADESU writes on the struggle for power in the coastal state.

What are the factors that will shape next year’s governorship poll in Akwa Ibom State?

According to stakeholders, the major issues are the capacity, competence, and track records of the governorship candidates. But, to observers, zoning, the strength of the competing parties, power of incumbency at the state level, federal might and sanctity of the ballot box cannot also be ignored.

Two main parties-the ruling Peoples Democratic Party (PDP) and the All Progressives Congress (APC)-are flexing muscles over the Akwa Ibom State Government House. Other parties may be spectators in poll day. Ahead of the election, politics in the oil-rich Southsouth state may acquire a character of warfare, judging by preparations on both sides. Across the 31 local governments, there is anxiety about how the contest will be won and lost.

To the PDP, there is no vacancy in the State House. “This is a stronghold of the PDP and there is need for continuity. Governor Udom Emmanuel deserves a second term,” said Information Commissioner Charles Udoh, who added: “The governor has performed and he will consolidate on his performance in the second term.”

However, APC chieftains have disagreed with the assertion. To them, power shift is imminent because the governor has failed woefully. In their view, Emmanuel has not successfully built on the giant strides of his two predecessors, Senator Godswill Akpabio and Obong Victor Attah. At the caucus meeting of the party, Akpabio, who installed Emmanuel as governor three and half years ago, apologised to the leaders for what he described as “the mistake of 2015,” saying that it should be corrected in 2019.

A gale of defections has hit the PDP, which will make the 2019 battle a fierce contest between the decimated PDP and the APC, which has become a beneficiary of the continuous defection. The old and new APC chieftains are queuing behind the Managing Director of the Niger Delta Development Commission (NDDC), Dr. Nsima Ekere, who is likely to emerge as the party’s consensus governorship candidate. Emmanuel and Ekere are Ibibio from Eket Senatorial District. Thus, the zoning hurdle is resolved.

To APC leaders, another four years for Emmanuel will compound the retrogression of the 31 year-old oil-producing state. The bone of contention, according to them, is that, apart from failing to maintain the legacy projects of his predecessors, the governor cannot lay claim to any meaningful project undertaken in his first term. “The governor was not prepared for governance. He was not trained for governance. Akwa Ibom needs assets manager,” said Eseme Eyiboh, former member of the House of Representatives. “Even, the governor cannot construct the road leading to his Eket Federal Constituency,” he added.

Many indigenes are also comparing the three tenures. Between 1999 and 2007, incorruptible elder statesman Attah, architect and town planner, who fought for the creation of the state, started the implementation of the state’s development plan. He earned the appellation of ‘father of modern Akwa Ibom,’ having designed the master plan and started rebuilding the then small provincial town of Uyo into a metropolitan city. Attah fought the infrastructure battle. The evidence is the network of roads in the capital. These include Nwaniba, Edet Avenue, Nsikaka Eduok, Atiku Abubakar, and IBB Avenue. He accomplished the projects, despite the meagre resources at his disposal.

Attah developed the Central Business District. He built the famous Plaza, which consists of a park and shops in the centre of the town. The former governor initiated the airport project, which was comp-leted by his successor. He built the IBOM power plant, which generates into the national grid and contributes to electricity supply in the state.

Also, Attah built the Ibom Hotel and Golf Course, the first five star hotel in the Southsouth, and the largest gulf course in West Africa. He founded the Akwa Ibom State University, which was completed by Akpabio. A prudent manager of resources, the total amount that accrued to the state treasury under him in eight years was N900 billion.

Akpabio was able to sustain the tempo of progress, although his style of governance was different. With N3 trillion in eight years, he raised the bar, earning the appellation of the uncommon transformer. He completed the airport project, as it were, set up a novel specialist hospital with equipment for brain surgery, built a stadium of international standard, and set up an e-library. The hospital is now a subject of controversy. Its former handlers, Cardiocare, has handed off, paving way for Clinicoteck from Canada. Unless urgent action is taken, the big edifice may become a ghost of itself.

Akpabio also established the Tropicana Complex. He built the Four-Point Hotel. The former governor also built the Government House in nine months. He also completed the stadium project, the biggest brand advertiser for Akwa Ibom. 0

The roads and flyovers built by Akpabio is a fitting tribute to an efficient administration. They include Idoro, Uyo-Nung Udoe, Uyo-Abak, Uyo-Ikot Ekpene, Abak-Ikot-Ekpene and Airport roads.

According to observers, Akwa Ibom people are worried that, unlike his predecessors, the Emmanuel administration cannot boast of any legacy project in the last three and half years, despite allegedly earning N1 trillion. In addition, the administration is being criticised for not maintaining the assets it inherited. In their opinion, the infrastructural and economic development is now stagnant, owing to the neglect of the master plan and economic blue print of Attah era.

The elite are complaining about the state of the Le-meridian Hotel, which was previously managed by the SPG Group, and the golf course, which was managed by the London-based IMG Group. They allege that, instead of launching the state on the path of industrialisation, the banker-turned governor is not dreaming big. Of importance to the state, they argue, is the Oil and Gas Free Trade Zone, which has not come to fruition. “He is setting up a coconut refinery in a state that has no coconut trees, instead of palm oil production which the state has been noted for. The way out is for him to start a coconut nursery, which will take between five and seven years. He claimed that he has revived the Peacock Paint, but the products are not available. He said he has built tootpick and pencil factories, but we can see the products,” lamented Eyiboh.

The former federal legislator also criticised the administration for shutting down Eket Stadium since 2015 on the ground that bit will be renovated, and demolishing markets in Eket and Afinonke, under the guise of remodeling. “The traders now sell on the road,” he fumed. Besides, Eyiboh said education is suffering, pointing out that “there are only six JAMB centres in Akwa Ibom State.”

“Why can’t government provide more centres? People from the governor’s constituency go to Bayelsa, Rivers, Cross River to take JAMB exam. Some cannot go because of transportation and accommodation costs. The literacy level drops,” Eyiboh said.

A former deputy governor, Mrs. Valerie Ebe, complained that ordinary people are in agony in Akwa Ibom. She described the state as a land of nightmare. Her grouse is that business is not thriving and youth unemployment is soaring. “All is not well in Akwa Ibom State. We have been suffering and we don’t want to suffer again,” she said. Urging the people to gird their loins, she added: “There must be change in Akwa Ibom.”

Other Akwa Ibom politicians believe that the governor, a technocrat-turned politician, has not been able to adjust to the peculiar partisan methods of politicians. For example, they pointed out that he failed to initiate comprehensive reconciliation with aggrieved PDP aspirants who lost out during the 2015 nominations. Others alleged that he has not sufficiently courted other political elders outside Akpabio’s influence. He did not also consider the import of personal structure, merely learning on his predecessor, who has now abandoned him and firing salvos from the opposition.

In the last couple of weeks, Emmanuel’s men and Akpabio’s aides have been exchanging hot words over the finances of the state. The Akpabio camp has alleged that what his successor has received from the national treasury in the last three years is more than what has accrued to the entire Southsouth region. But, Emmanuel accused Akpabio of leaving behind a debt of N500 billion. Akpabio fired back, clarifying that he only left behind a debt of N50 billion. But, the senator also emphasised that he left behind financial enablers, which Emmanuel has failed to harness to get more revenue.

Shortly before his departure, Akpabio explained that he had used state money to construct federal roads. Recently, he pointed out that the Federal Government had paid back to Emmanuel part of the money; first was N14 billion, and later another N78 billion. “What is the governor talking about after all the receivables? he queried.

An APC chieftain, Chief Benedict Ukpong, accused the governor of attributing what he described as his colossal failure to his predecessor. He said: “Governor Emmanuela’s score card shows that he has under-performed. Akwa Ibom, the highest revenue yielding state to the Federation Account, is not benefitting maximally from the Federal Government Economic Recovery Growth Strategic Economic Plan and other social investment scheme initiated by the Federal Government due to the reluctance of the government of Akwa Ibom to effectively key into those programmes for obvious reasons that it does not want the Buhari administration to take credit and grow in popularity in the state.”

Echoing him, former House of Representatives member Abom Tony Esu chided Emmanuel for flaunting cosmetic achievements. He said 2019 is a decisive year, predicting that the power of incumbency at the state level will collapse. To the Chairman of the Nsima Ekere Campaign Commitee, the people are anticipating the end of an era in the state. “The power of incumbency will collapse. It will not count. What will shape the governorship poll is the performance of the governor and the perception of the people about what he has achieved. If Emmanuel is defeated, it will not be the first time an incumbent governor will be defeated. Clement Isong was defeated by Senator Donald Etiebet in 1983,” he added.

However, Commissioner Udoh disagreed, saying that the governor has lived up to expectation. He said Emmanuel deserved credit for restoring peace in Akwa Ibom. He pointed out that while kidnapping, assaults, brigandage and other social vices characterised the state under Akpabio, his successor has brought tranquility.

The comissioner said his boss inherited much burden from Akpabio, which he has tackled with courage, resilience and loyalty to the state. He denied that Emmanuel has not defended the legacies of his predecessors, pointing out that all the assets are being managed prudently. He said the hospital, airport and stadium projects were not abandoned. On the stadium, he said the 10-year maintenance contract with Julius Berger Ltd has not been cancelled.

On the Four Point Hotel, he said the governor spent N7.2 million dollars to acquire the brand name. “Under Akpabio, the hotel was commissioned and shut the next day. They brought caterers from outside to prepare and serve foods,” he said.

The governor’s Chief Press Secretary, Ekerate Uboh, berated APC chieftains for peddling falsehood, saying: “Too much money were collected for jobs not done under Akpabio.” On the controversy over the Uyo-Ekot-Ekpeme Road, Udoh said: “Money was collected and not paid to contractors. We faced litigations over the road project. Twenty three kilometres have now sbeen done. It was awarded in December 2011. Why did Akpabio not complete it? The contract sum has been reviewd. Why the variations totally N7.1 billion?”

The commissioner said apart from regular payment of salaries, Emmanuel has paid the backlog of pensions for 10 years. Also, outstanding gratuities spanning eight years have been offset up to 2015.

Udoh said the government has not reneged on its free health care policy. He said: “Free medical care for the aged, children and pregnant women has been sustained.” He doubted the sincerity behind the huge cost of the specialist hospital project. “Kano just built a bigger and better specialist hodpitsl for N4.5 billion. In 2011, Akwa Ibom Specialist Hospital was built for N45 billion. Yet, the project was uncompleted,” he added.

On education, the commissioner said: “We inherited 2,000 dilapidated public schools. N600 million is paid as WAEC fees yearly. There is free basic education from primary to JSS level. We pay attention to school infrastructure, quality of teachers and the curriculum. Out of 6,000 teachers recruited, we had to send 2,000 packing after failing examinations in the subjects they were to teach. We have fixed 400 schools in three years.”

On industrialization, Udoh said: “Akpabio promised 31 industries. He never built one. Now, this administration has built nine.”

September 14, 2018
10 students battle for $5000 seed fund in Ogun

Ten students drawn from both private and public tertiary institutions in Ogun State are battling for $5,000 dollars grants in a “Tech Challenge Ogun” competition.

Already, ideas from the competing students have been selected “for show and tell” challenge slated for September where the best five ICT-based ideas would be rigorously interrogated and examined for feasibility, innovation and viability before whichever emerges best in the incubation hub wins the $5,000 seed fund.

The ideas includes Intelligent Cloud Based Customer Care Software, aimed at replacing human agents with artificial intelligent bots that would be able to attend to unlimited customers; ‘Linkcity’, a web based platform which provides an easy way for locals to connect with reliable places, platforms and services around the city; Farmer Pride, which is aimed at providing online platform and application where farmers interact with the society to increase productivity; Tour and Market, aimed at creating platform with full details of all cool hangout spots in the state and also provide business network and Views Ways, which provides proper, accurate and reliable access route across the country, centralised diagnoses index database management system among others.

The ideas were developed by Akinsanya Adeoluwa of Babcock University, Okala Charles also of Babcock University, Godsstar Ezeamuzie of Covenant University, Akinwande Mayowa of the Federal University of Agriculture (FUNAAB), Ojekunle Olusegun of DS Adegbenro ICT Polytechnic and Abdullahi Monsuru of FUNNAB.

Organiser of the Challenge and CEO of VerveTree Hub, Niyi Ayoola , while showcasing the ideas and the student – developers at the Youth Development arm of the Olusegun Obasanjo Presidential Library (OOPL), said the competition began with 60 ideas but was pruned to 10 at the preliminary stage.

Ayoola said the second best idea will get $3500, while the third attracts $2500 grants.

“Tech Challenge Ogun is a follow up to the Tech Summit Ogun that was held in January. Within this period, two town hall meetings, involving all higher institutions in the state, were held where we interacted with idea owners. We got well over 60 ideas from owners who partook in the challenge, out of which 10 best ideas were picked at random.

“We’ve never met any of the idea owners before, it was a play level ground involving senior partners in the industry and one of the first questions was that ‘does it solve a problem?’ and it has to be saleable right from the conception stage to graduation stage.”

Edu..….Some of the students & organisers of ‘Tech Challenge Ogun’

July 26, 2018
The other battle Nigerians must fight
Currently Nigerians are facing a number of political battles. Not that the political space has ever been tranquil but the present warm-up is a reaction to developments leading to elections from ward level to the Presidency. In many countries these are exciting times but in our own the times are worrisome, over-sensitive even dangerous. Nigerians are used to all of these. But there are other things, not at all political that have been showing in our national life for about a decade now that should also engage the attention, anxiety, even anger of our people. There is a conspiracy of the private sector of the economy against the Nigerian state. The problem is more confounded since the private sector continues to manipulate the economy with the resultant effect of reducing the standard of life and negating the welfare of Nigerians.

I want to go to specifics.

One, the manufacturing sector of the economy has in recent years shortchanged the Nigerian consumer. It has done this so un-obtrusively but nonetheless effectively that only serious discerning Nigerians can observe the trend. For example the quantum, not necessarily quality of products being manufactured and marketed has reduced dramatically. Examples are Powdered Milk, Tea Packs, and many other ordinary consumer items. I have been an addict to Lipton tea, and Powdered Milk, for decades now. It is only recently that I observed why the market values of these consumables increase only marginally; the quantity being sold has drastically reduced. Has anybody noticed this?

The Banking industry: an important element in the private sector has concocted various means of taxing (debiting) Customers’ Accounts that at the end of the month or accounting period you will observe that a sizable chunk of your money has been taken away under various guises. At the end of their financial year most Nigerians Banks are laughing heartily, returning unbelievable profits. To further bolster their nefarious activities, the CBN helps commercial Banks to retain high level interest rates for borrowed money while granting peanuts to customer’s savings account. At the end of the day you will wonder how the financial sector of the country could be so anti-people or prohibitive.

Electricity and power: this sector is perhaps the most notorious for pinching the private purse. Since government engaged in the so-called privatization of the power sector, Nigerians have had no peace. The DISCOs operates as if they are a law unto themselves. They have refused to operate through transparent metering system; rather they dictate their charges and consumption at their whims. Hence a household that normally consumes 5,000 naira worth of electricity per month is commanded to pay up to 15,000 naira per month now. There is virtually nothing you can do about that. This notorious blackmail of the populace will be resisted one day hopefully.

Transportation: occasionally, Nigeria suffers fuel deficit at the filling stations. This is the time for heartless petrol dealers to make life unbearable for motorists especially the so-called car owners who just manage to eke out a living. The operator closes his station during the day and opens up for the so-called black market in the dark, assuring unearned income for his business.

Vehicle Spare part Dealers: prices of motors spare parts and other mechanical accessories keep on flying in the air; Unfortunately this business is operated mainly by a section of the community, as it were. As it is in Nigeria, it is a complete monopoly which does not give room for bargaining or downwards review’; you either buy at the retailer’s price or you pack your vehicle or mechanical equipment. This trade harbors the most stringent and closely knit trade unionism in the Nigeria business world. The price level is the same everywhere and nothing can change it.

One also wants to refer to dividends now payable to shareholders in most companies today. It is not unusual to read that a company is giving out #150 – #200 dividends for one unit of share costing 50 naira. In plain language, this is a profit of about 300 percent over your initial investment in the company. Please note that it is not the productivity or high efficiency of your company that has produced three hundred 300 percent dividends. In most cases it simply means that the company is smart enough to clamp an unreasonable level of price on its products. The larger community which constitutes the consumer bears the brunt of this concealed exploitation.

Now with all the above and many more, one wonders where government comes in. Why it is inadvisable to operate a rigid price control regime, there should be institutions of government that should oversee the correctness and justification of vital elements that constitute private sector of the economy. While we all look for a dynamic economy propelled by private initiative, the larger community’s interest should also come into consideration. For example one would like to believe that an organ like (SON) Standard Organization of Nigeria will not only care about quality but the adequacy and correctness of what a manufacturer is selling to the public. The problem as I have earlier mentioned is that Nigerians are more concerned with whom their councilors, governors, ministers, and presidents are than have a look, just a look at the other side of life.

A manufacturer that reduces the quantity of milk or the number of tea sachets in a container is not doing the right thing. It would be a different thing all together if the container had been cut and reduced by half with the contents commensurate with the new container. But including half of the powdered milk or whatever materials into the same container, or reducing the number of tea sachets into the same package is corruption and should be treated as such, even in a liberal democracy. There should be regulatory bodies that continuously protect the interest of the consumer. This country deserves to have a fair deal from both government and the private sector of the economy.

There are many ways Nigerians can fight back, but the most obvious ones are boycott of the good and services of the oppressor companies, and getting government to put necessary legislation in place.
- Fasuan, MON, writes from Ado-Ekiti.
May 29, 2018
Battle of the sexes : Who would win in a match between Roger Federer and Serena Williams?

Tennis champions Roger Federer and Serena Williams are widely considered to be the greatest tennis players of all time. But who would win in a match between the best men’s player and the best women’s player?

Quora user, Aleksa Milovanovic had one of the most up voted responses by claiming the questions comes down to “what’s known as a Battle of the Sexes” in tennis.

Milovanovic referenced three male vs. female tennis matches of previous years, including 55-year-old Bobby Riggs’ 6-2, 6-1 victory over former women’s number one player Margaret Court in 1973.

Almost 20 years later, 40-year-old Jimmy Connors played 35-year-old Martina Navratilova on a pay-per-view show at Caesars Palace in Las Vegas in 1992. Connors was only allowed one serve, while Navratilova was permitted to hit into the doubles alleys. Despite the handicap, Connors still won 7-5, 6-2.

Completing Milovanovic’s historical perspective were two single set matches between Karsten Braasch and the Williams sisters. Braasch, ranked the 203rd best male player in the world at the time, beat Serena Williams 6-1 and Venus Williams 6-2, despite a training regime that “centred around a pack of cigarettes and more than a couple bottles of ice cold lager,” according to Observer Sport.

Milovanovic concluded: “Federer is the greatest men’s tennis player ever. He isn’t anything like Riggs or Braasch [because] he has some of the best training regimes that anyone could ask for. His strokes are imperious and he hits powerfully.

“Williams was unable to beat Braasch, or even make it competitive. How would she fare against Roger Federer? My guess is she’d be very lucky to win one game in a best of five.”

Ganguly says this remains 20% slower than the serves Federer is used to returning when he competes against — and defeats — male players like Jo-Wilfried Tsonga (236.5 km/h or 147 mph) or Andy Roddick (249.4 km/h or 155 mph).

“On the basis of her serve, Serena can definitely not beat Federer,” Ganguly said.

“His movement is much better than Serena’s, [he has] much more stamina having himself played many five setters over his lifetime, [and] knows how to pace his game to defeat an opponent without even reaching the top gear.”

In an NPR interview to discuss his 2017 book “But Seriously,” former tennis champion John McEnroe claimed Serena Williams would struggle to crack the top-700 ranked players if she competed in the male circuit.

“If she played the men’s circuit she’d be like 700 in the world,” McEnroe said. “That doesn’t mean I don’t think Serena is an incredible player. I do… but if she had to just play the circuit — the men’s circuit — that would be an entirely different story.”

McEnroe was criticised for his “clumsy” comments, but Williams herself even conceded in 2013 that if she played a top player like Andy Murray she would likely “lose 6-0, 6-0, in five to six minutes.”

Federer’s head-to-head record against Murray consists of 14 wins against 11 losses, so if Williams believes she would lose to Murray, she would likely lose just as badly to Federer.

Ultimately, comparing Federer and Williams is a frivolous task, as they will only ever compete against each other if another “Battle of the Sexes” tennis match materialises.

Ganguly perhaps summarises it best with this statement: “Just enjoy their game as long as they are playing, because you seldom get to see such players, playing [at] such [a high] level of tennis.”

April 8, 2018
APC/PDP: Battle of the spokesmen

FINALLY, after many months of indelicate and fanciful verbal jousting, the spokesmen of Nigeria’s two leading political parties, Lai Mohammed of the APC government, not the party, and Kola Ologbondiyan of the PDP, have crossed swords. First to draw blood was Mr Ologbondiyan, PDP’s National Publicity Secretary, who took umbrage at Vice President Yemi Osinbajo’s brief but trenchant remarks about PDP’s unbridled corruption during their years in office. On the same day Prof Osinbajo made the remarks during the 10th birthday colloquium of APC leader Bola Ahmed Tinubu, the PDP’s spokesman challenged the ruling party to name names or keep quiet. It is not clear whether he meant the threat.

But one day after, Mr Mohammed responded acerbically, and named names. According to him, “The national chairman of the party, Uche Secondus, on February 19, 2015 received N200 million from the office of former National Security Adviser (NSA). Then PDP Financial Secretary, on the 24th of October 2014, took N600 million only from the office of then NSA. Then National Publicity Secretary Olisah Metuh is on trial for collecting N1.4 billion from the office of then NSA…Raymond Dokpesi, the Chairman of DAAR Communications is also on trial for receiving N2.1 billion from the office of then NSA. Former SSA to President Jonathan, Dudafa Waripamo-Owei, is also on trial for N830 million kept in accounts of four different companies.”

Miffed, Mr Ologbondiyan responded in equally harsh tones, with dark hints of the jousting ending up in the courts. As he put it, “The APC Federal Government has manifested its frenzy by going after matters that are in court and in which none of the persons have been convicted…This is a government that is yet to account for $26 billion (N9 trillion) stolen through corrupt oil contracts in the NNPC, N1.1 trillion worth of crude diverted to service APC interests, N18 billion Internally Displaced Persons (IDP) intervention fund stolen by APC officials. This includes the former Secretary to the Government of the Federation (SGF), Babachir Lawal, the N10 billion National Health Insurance Scheme (NHIS) for which members of the Buhari cabal were indicted. This includes the Mainagate, where the APC government recalled and reinstated an individual indicted for scam running into billions of naira.”

Ah, at last, the battle is joined, many months before the next general elections. The fight is likely to get bloodier, cruelly revelatory, probably very damaging to reputations, and ending eventually and entirely in Pyrrhic victory. The public can only wish them more power to their elbows, as the media take ringside seats.

April 1, 2018
‘Assist in battle against trafficking’

NON-PROFIT organisations have been advised to use toll free lines to help rescue trafficking victims.

The admonition was given by Polaris, a United States-based group leading the fight against modern slavery, at a briefing with foreign journalists hosted by the Department of State’s Foreign Press Centre in Washington.

The National Hotlines Director, Ms Caroline Diemar, who oversees U.S National Hotlines programme, stressed the importance of infrastructure and support in ensuring the application of hotlines and rescue text message tools for nonprofit groups.

“Even though it is an NGO running the hotline, it should have government support not only for funding purpose but for some form of legitimacy. At the same time, the independency of being an NGO hotline dedicated to combating and preventing human trafficking should not be eroded by government interference,” she said.

Speaking on how Polaris leverages on data and technology to pursue traffickers, Andrea Rojas, manager of Strategic Communication, added that dedicated toll-free line has proved to be effective in fighting the scourge in the U.S. and other parts of the world.

“A dedicated toll-free line for human trafficking is definitely something to explore. We have done it in other countries as well and it works depending on the peculiarities of that country, but we definitely recommend a number that can be remembered by everybody. It is not just for survivors but it is also for service providers because we know how mobile the population is,” Rojas said.

February 20, 2018
‘Assist in battle against human trafficking’

NON-PROFIT organisations have been advised to use toll free lines to help rescue trafficking victims.

The admonition was given by Polaris, a United States-based group leading the fight against modern slavery, at a briefing with foreign journalists hosted by the Department of State’s Foreign Press Centre in Washington.

The National Hotlines Director, Ms Caroline Diemar, who oversees U.S National Hotlines programme, stressed the importance of infrastructure and support in ensuring the application of hotlines and rescue text message tools for nonprofit groups.

“Even though it is an NGO running the hotline, it should have government support not only for funding purpose but for some form of legitimacy. At the same time, the independency of being an NGO hotline dedicated to combating and preventing human trafficking should not be eroded by government interference,” she said.

Speaking on how Polaris leverages on data and technology to pursue traffickers, Andrea Rojas, manager of Strategic Communication, added that dedicated toll-free line has proved to be effective in fighting the scourge in the U.S. and other parts of the world.

“A dedicated toll-free line for human trafficking is definitely something to explore. We have done it in other countries as well and it works depending on the peculiarities of that country, but we definitely recommend a number that can be remembered by everybody. It is not just for survivors but it is also for service providers because we know how mobile the population is,” Rojas said.

The U.S national human trafficking hotline has identified 36,270 human trafficking cases. Globally, there are 40.3 million victims of modern slavery, according to statistics from the UN.

February 19, 2018
FinTechs, banks in desperate battle for market control

Technology is rapidly reshaping financial services operations. Banks and Financial Technology (FinTech) companies have identified a shift in consumer behaviour towards digital channels. Rising acceptance of FinTech start-ups’ services by bank customers threatens lenders’ control of over N30 trillion assets and revenues in the banking sector. That dominance is changing as FinTechs begin to offer products and services previously exclusive to the banks. Many lenders are fighting to reclaim lost businesses by investing in technology. COLLINS NWEZE captures the ongoing digital disruption in the banking sector and what it means for operators and customers.

Michael Phillips, 35, was leaving home for work when his smartphone beeped with a familiar Facebook message alert. It was another reminder for him to renew that month’s subscription for his DStv – pay-to-view cable service.

His four-year-old daughter, Nancy, had reminded him the previous night that the subscription would be expiring that Monday morning. Two payment options came to his mind. The first was to renew the subscription through internet banking platform. The other option was to use the Paga network.

Few minutes later, he opted for the Paga option, one of the Financial Technology (FinTech) firms and money transfer service provider. FinTech is the new technology and innovation that competes with traditional banking methods in the delivery of financial services.

As little as the N100 transaction fee seems, it represents one of the millions of revenue leakages facing commercial banks daily. Paga now has over 7.5 million customers in just eight years of its operation.

A few years ago, Phillips could not have imagined paying his bills online without going to the banking hall.

Another bank customer, Lucy Osademe, chatted endlessly on her two mobile smart phones as she waited in a long queue within Ikeja to withdraw N10,000 at an Automated Teller Machine (ATM). Then the machine stopped dispensing cash; the long queue disappeared.

Osademe decided to go into the banking hall where he met a longer queue. One hour later, a customer service officer announced a system downtime.

“Please, the system is very slow. Kindly give us more time to process your transactions,” the officer pleaded. It took one hour before Osademe was paid.

Yet, for the likes of Phillips, willing to leverage on the FinTech opportunities to settle their financial obligations, many, like Osademe, are frustrated by the poor quality of service they get from their banks. There are equally a larger number of customers who have lost confidence in the banks’ internet or mobile banking platforms.

“Mobile payment is where the world is heading and Nigeria cannot afford to be left behind. We do not compete with the banks since our funds are saved with them. But, there are places where we clearly compete, and there are more places where we collaborate to do what we are doing,” Paga’s Co-Founder, Jay Alabraba, who has been in a rush since taking up the top job eight years ago, said during a chat at his Lagos office.

The Paga chief insisted that change was needed because brick-and-mortar approach to banking is expensive and not accessible.

He said: “Nigerian consumers are changing. They are getting busier with no time to waste. They want to get their services nearer to where they work or live. Shopping is becoming entertainment and recreation while the phone is becoming their most intimate relationship. That explains why we are stepping in.”

As the banks and FinTech firms battle for the control of the more than N30 trillion banking assets and revenues in the financial sector as highlighted in the Central Bank of Nigeria’s (CBN’s) economic report for June, their customers are taking strategic decisions on which platforms to embrace.

But, it is not just Paga that is making banks rethink their continued existence, since technology firms crept into some businesses traditionally meant for the lenders. Social media platforms, e-commerce providers, and mobile money services, technology payment firms have brought new twists to how banking is done.

Managing Director, Cellulant Ghana, Albert Ngumba, said his firm facilitated payment for agricultural value-chain, helping Nigeria farmers to buy fertilisers, paying through Cellulant platform instead of banks. Famers can also perform financial transactions, including savings, transfers, loans, micro insurance using its platforms.

“We sit between the banks, mobile operators and merchants. We power payment and make transactions easier for the people,” he said when contacted on telephone.

“Our wallet account holders can now enjoy the convenience of ATM cards to take out money from a machine and buy products or services. They don’t have to carry cash because they can get it from almost any ATM machine and pay bills easily and quickly,” he added.

Also, before the coming of Treasury Single Account (TSA), Nigeria’s notoriety in the public finance management brought the country to the state of near-economic-collapse.

But today, Remita, an e-payment solution developed by SystemSpecs and adopted by the CBN for the payment and collections of funds for the Federal Government has turned the backbone of TSA implementation.

The TSA consolidates all inflows from government agencies, using the Consolidated Revenue Account (CRA) at the CBN.

Prior to the advent of Remita, commercial banks were responsible for the collection, processing and management of government revenues. The deployment of Remita has reduced government’s debt servicing costs, lowered liquidity reserve needs and boosted effective use of surplus cash.

“Remita processes over $30 billion transactions every year, and that’s just within Nigeria,” SystemSpec’s Chief Executive Officer, John Obaro, said.

Besides lowering the level of corruption, he said the TSA greatly exposes the emerging potential of FinTech industry in the country.

Other platforms that have taken chunks of banks’ businesses and profitability are: Facebook, Twitter, LinkedIn, My Space, Tumblr, Instagram, Alibaba, Jumia, Konga, Supermart, Amazon, Square, Cellulant, Apple, Google, Visa and MasterCard.

Companies, such as Uber, Taxify and Airbnb have equally developed radical business models that continue to surprise many institutions.

Secure online payments systems, such as PayPal and mobile payments and transfer solutions, are changing the ways in which payments for goods and services are made. These firms are helping consumers to make payments, secure credits, and do things that banks consider impossible. They satisfy customers’ thirst for speed and variety, leaving banks struggling for customer loyalty.

An Executive of the Research and Policy Department, Nigeria Deposit Insurance Corporation (NDIC), Kabir Katata, said digitisation has changed financial services landscape.

To him, FinTech firms are latching on clear evidence that consumer behaviour and expectations of service and experience are changing.

He said the take-off of e-commerce and emergence of fast-rising online outlets, such as Jumia, Konga and Supermart, are opening up new avenues for e-payments and data collection that were previously left for banks.

Speaking at a media conference in Kano State, Katata described FinTech as a technologically-enabled innovation in financial services that could result in new business models, applications, processes or products with an associated material effect on the provision of financial services.

He said: “Multiple technologies poised to drive the next wave of financial services are converging in maturity. FinTech threatens to disrupt financial markets with the banks taking the threats like the loss of control, the emergence of a non-regulated environment, market fragmentation, and loss of revenue—very seriously.”

Katata disclosed that while many banks have been able to retain their customers through traditional channels and digital service offerings, recent shifts are threatening the customer base of those yet to key into it. Even long term banking relationships at traditional banks, he added, is susceptible to disruption.

Managing Director, Nigeria Interbank Settlement System (NIBSS), Adebisi Shonubi, noted that transaction at banks’ branch transactions have dropped by 25 per cent in the last one year, as more customers embrace electronic payment.

“Banking transactions are moving towards zero human interactions, saving cost and time for customers,” he said.

A Senior Manager, Management Consulting, KPMG Nigeria, Bode Abifarin, disclosed that one-third of Nigeria’s population is below 24 years. The implication is that with a growing middle-class population, internet penetration and usage, which are the backbone of FinTech firms, the sector is set to grow significantly.

Abifarin said: “KPMG survey shows that 77 per cent of Nigeria’s banking customers now use social media for personal purposes. The problem is that Nigeria’s banks have largely failed to translate this passion for the internet and social media into increased adoption of internet and mobile banking solutions and that is what FinTech firms are leveraging on.”

Echoing him, Partner, Technology Advisory, KPMG in Nigeria, Boye Ademola, said that digital platform businesses are also leading a quiet revolution in Nigeria and indeed, Africa. Over the last 18 months, Jumia, an e-commerce platform and another Nigeria’s leading FinTech firm, attracted investments of $425 million and $250 million respectively. He said these firms are valued at over $1 billion each. “They both have footprints across Africa and are looking to become formidable platform businesses,” he stated.

Even global financial institutions have seen the rising influence of FinTech firms.

Speaking at the 2017 Annual Meetings of the International Monetary Fund/World Bank, IMF Managing Director, Ms. Christine Largade, acknowledged the rising excitement about FinTech.

She said: “We cannot be sure, but we know that digital currencies, new models of financial intermediation, and artificial intelligence will change the way we do our job. Our key message is that it would be wise for central bankers and regulators to prepare for the potential benefits and challenges of FinTech,” she advised.

Ms. Largade said that FinTech might provide solutions that respond to consumer needs for trust, security, privacy, and better services, change the competitive landscape, and affect regulation.

She admitted that boundaries among service providers are blurring, barriers to entry changing and improvements in cross-border payments likely.

SystemSpecs Executive Director, Deremi Atanda, said the rising influence of FinTech in banking is not a threat, but would improve banking penetration in key segments of the economy.

He said that technology is key in realising the CBN’s financial inclusion plans.

“If financial inclusion is about bringing people into the formal economy, then FinTech is making that happen and that can only boost economy. So, FinTech is accelerating the rate of economic growth by bringing more people into the financial system,” he said.

Atanda, who spoke on the theme: “Regulatory concerns on risks: Challenges and the resulting impacts on FinTech adoption” at a financial inclusion conference in Lagos, said the introduction of FinTech cannot in anyway threaten banking services. Rather, it will compliment them.

He said: “Well, I do not think the banks are jittery about FinTech roles in providing financial services. It is not an immediate threat in this immediate environment. At the end of the day, payment is cultural. And it must also be within context. And so, technology will always follow the ways and manners of people, even though it can be disruptive in nature.”

The SystemSpecs’ director said lenders will have to leverage on infrastructure such as internet penetration, data, identity, which FinTech firms are trying to ramp up. Atanda said: “It is not that FinTech is going to disrupt banking per say, the mix of it accelerates the growth, exchange of value, and boosts the economy in general.

“The role we (FinTech) play is just as enablers and facilitators within a collaborative ecosystem, because one party cannot do it all alone. We are going to be working with regulators, banks and other financial service providers and generally everyone focused on seeing transactions thrive.”

According to him, 70 per cent of FinTech transactions are centred around remittances and lending as they do not take deposits like commercial banks.

Pointing out that it was not unusual to see regulators clash with FinTech innovators, Atanda said regulators must ensure that technology being adopted does not have unintended consequences that challenge what they saw in creating those things.

The CBN Director in charge of Banking and Payments System Department, ‘Dipo Fatokun, said the demand for the services of FinTechs will continue to rise, even as they need commercial banks’ for them to operate effectively.

He noted that the increasing roles of FinTech companies in the payment system will allow banks to focus more on their traditional role of financial intermediation.

Fatokun predicted the rise in the need for collaboration between the FinTechs and banks, as none can displace the other.

The CBN director explained that banks in developed world focus on their core functions and leaving other roles to service providers.

Fatokun said: “FinTechs have always been in existence. It’s just that more prominence is being given to their roles. In some jurisdictions FinTechs are being allowed, or plans are under way to allow them connect to the central bank which, previously, was the exclusive preserve of the commercial banks.

“The fear has always been there that FinTechs will take over the roles of the banks and that a time will come when there will be no bank. FinTechs are not licenced as financial institutions, they cannot take deposits. They can only facilitate payments or make it easier but the banks will still continue to play a very big role.

“Banks provide hundreds of services outside of payments. They open Letters of Credit (LC), give out loans and you can only give loans if you take deposits. The banks provide guarantee, either an advance payment guarantee or a performance bond for contractors. For you to do that, you need to be a licenced financial institution.”

According to him, FinTechs have played a complementary role for the baking industry and that have made it possible for banks to provide services at cheaper rates and expand their services to the grassroots.

Konga said it has opportunity to create an operating system for e-commerce not only in Nigeria, but across Africa. It admitted that one needs heavy lifting and deep pockets to succeed in this business insisting that the entrepreneurial energy of Nigeria is greater than what Konga alone can do.

Jumia is taking the local market very seriously, just as it has taken precautions to guide against fraud.

It said the online retailer introduced cash-on delivery policy to ensure that customers match request with product quality.

But, Board Chairman, Parkway Projects, owners of ReadyCash Mobile Money, Richard Obire, explained that three parties are involved when mobile money transaction takes place.

The banks, telecom operators and the mobile money operator are all involved, sharing the fee that come with the transaction.

Obire, who was former Executive Director, Keystone Bank, said the cash involved in the transaction sits in the bank, although represented by electronic wallet.

He said the coming of mobile money is not totally taking away business from the banks, but is helping the lenders to tap into the unbanked market.

“The entire banking system is an ecosystem where the players are given roles to play. Such roles including banking the unbanked through mobile money will deepen the financial system,” he said.

Banks fight back with innovation, collaboration

As banks’ revenues fall, the lenders are looking at areas to bridge the gaps. There is the zeal to raise cheap funds, finance power sector projects, mortgage, agricultural and educational businesses.

Some banks have also gone into Facebook banking, social lending and partnership with global payment and technology firms.

Wema Bank’s Deputy Managing Director Ademola Adebiose said his bank is playing big in the digital space, where lies the future of banking. He said the mid-tier lender introduced Alat, a fully digital platform, to enable it capture the grassroots customers and the youths. Adebise said: “Digital banking is becoming more attractive to banks and their customers. It is catching the attention of everyone thinking of speed, efficiency and cost saving in banking.”

He explained that the lender had reviewed its marketing strategy, and made huge investments in the digital space. The Alat platform, he said, has over 100,000 customers, mostly the youths.

According to him, WemaBank is collaborating, not competing, with FinTech firms.

Adebise said: “I think we should see it as how do we build an eco-system. Yes, I have my customers. The FinTechs have their products. They will need to access my customers and we need to collaborate.

“It is not an issue of whether they are taking over or not. And mind you, the business of banking is regulated. The CBN is charged with the responsibility of regulation. But we cannot rule out the threat presented by FinTech and any forward looking organisation or bank must identify the areas of collaboration to build the ecosystem. You cannot be competent on everything.”

Besides, FirstBank, Fidelity and Union banks have partnered with PayPal to enhance online payment for shoppers. The partnership enables the lenders’ customers to register for a PayPal account from their internet-banking accounts.

By linking their-issued debit, prepaid or credit cards to their new PayPal account, customers can then shop and pay on millions of websites around the world from their personal computers, tablets or smartphones, without having to share financial information with the seller.

Fidelity Bank Chief Executive Officer, Nnamdi Okonkwo, described the introduction of PayPal as a deliberate attempt by the bank to make financial services easy and accessible to its customers.

Specifically, he said that the development is in line with the bank’s commitment to consistently deploy innovative strategies to make life easier for its customers.

Aside partnership with payment firms, some banks have also developed products that are technology-driven. The GTBank Instant, First Instant and Sterling Social Lender accounts were built by GTBank, FirstBank and Sterling Bank respectively to enhance social banking.

Here, customers can open accounts online, and that creates convenience for them.

For instance, Sterling Bank’s Social Lender Account allows it to grant loans to customers on Facebook. It provides a platform for online fans, followers who are customers of the bank to obtain micro-credit loans via social media starting with Facebook and Twitter.

The bank said approval of the loan happens within 10 minutes, and that borrowers can make the request online and get their accounts credited with the fund.

It explained that although it started with N3, 000 for borrowers, the amount will gradually rise, and is targeted at customers with urgent cash need.

Adaku Obi, a customer who benefitted from the loan narrated her experience: “While going to Yaba some days ago, I had no cash in my wallet. I needed cash badly. My cheque book was not even with me. I couldn’t find my bank branch around because I wasn’t familiar with the area.

“So, I tweeted at the handle of my bank. The response was swift. In 10 minutes, my account was credited with N3, 000 short term credit. That is how interesting banking has become.”

Access Bank Plc, Visa and shoptomydoor.com, an online shipping company are collaborating to give Visa cardholders opportunity to shop online at retailers in the United States (U.S.), United Kingdom (UK) and China. Such customers, the bank’s Executive Director, Personal Banking, Victor Etuokwu, said, will also enjoy exclusive shipping discounts and shop from the world’s major international retailers with more flexibility and convenience.

Stakeholders speak

Financial pundits believe that banks do not fear other lenders but the start-up in a bedroom. Managing Director, CRC Credit Bureau Limited, Tunde Popoola, said deepening the financial landscape creates room for new players to emerge.

Popoola said: “When the financial system is deepened, the banking industry will be the ultimate gainers. The good thing is that people now have more choices to make. It is only banks that key into the new opportunities that will benefit.

“But, if they are able to innovate, and device ways of seeing their customers not necessarily coming to the banking halls, but getting the services they need wherever they are, then, they will be the gainer at the end of the day. Lenders that are unable to get to their customers through some of these forms and processes will lose the market.

“Organisations such as Paga, Cellulant, are all part of what we are expecting. More of them will come. We have those who are in the telephone territory. There are those in the credit card territory and they are not formal banks. These are the things that will become the formal feature of our economy.”

Connecting past with future

White Sapphire’s Chief Executive Officer Biyi Fashoyin said it is not just the banks that need to innovate, the world itself is now a global village, and the social media is a community by itself.

Fashoyin said: “Any corporate entity that ignores the social media and technology is just on its own peril. Everybody now is now on social media, including the kids. Any wise bank will know that’s where the market is. It is a ready market.

“The industrial revolution came at a time. Europe, America and some other countries took part. Some other countries especially in Africa stayed back. Eventually those that participated became the global powers. Those that abstained were labeled third or fourth world countries.

“That is exactly what is going to happen to the business world. Any bank that is stepping back now, running away from the current realities which reside in the social media space, or the virtual world, will soon be out of business.

“My advice is that every bank should come in and plug into it. That’s where your market is. That’s where your future is. Your future is actually in the social media,” he said. Fashoyin, who is a social media adviser, admitted that the platform has become a place for the good, the bad and ugly.

Global trends

At the international level, FinTech firms are among global business leaders. Alibaba Group Holding Limited, a retail and technology conglomerate provides consumer-to-consumer, business-to-consumer and business-to-business sales services via web portals and electronic payment services.

As of last month, Alibaba’s market capitalisation stood at $486.27 billion. It is one of the top 10 most valuable and biggest firms in the world.

PayPal’s services allow people to make financial transactions online by transferring funds electronically between individuals and businesses. Through PayPal, users can send or receive payments for online auctions on websites like eBay, purchase or sell goods and services, or donate money or receive donations.

Amazon, has 230 million accounts, and dominates online shopping. The tech giant is the largest Internet retailer in the world measured by revenue and market capitalisation, and second largest after Alibaba Group in terms of total sales.

The PricewaterhouseCoopers (PwC) 2017 digital banking survey found that 46 per cent of customers skipped bank branches altogether, relying instead on smartphones, tablets, and other online applications.

U.S. Financial Services, Industry Leader, Neil Dhar, writing in this month’s edition of the PwC Financial Services report titled: Digital Transformation in Financial Services, said both wholesale and retail users now expect a digital experience from their financial institutions.

Dhar said: “It is about differentiated customer experience, providing what customers want, when they want it, and how they want it, whether you are a bank, insurer, or asset manager.

“This is not just a matter of cosmetics. Banks need to change their back-end operations to support it. And they will need to think differently about how to solve problems because technology is not a silver bullet.”

Stakeholders proffer solutions

Wema Bank Executive Director of Retail & North Directorate, Moruf Oseni, advised banks to take steps that would enable them meet customers’ needs better. He said that customers should be given a priority in designing banking products and services.

Oseni advised: “Banks must become customer-centric because the disruption in the banking industry is real. There are two ways to react to it. Its either we sit down and wait to be protected by the regulators or work with the ecosystem to build the future of banking.”

On competition in the industry, he said: “Competition in the e-payment space is stiff. Bank to bank competition is not even as deadly as FinTech startups-bank competition. Any bank that is not innovative in the times we live in will die a natural death.”

Ms. Largade advised regulatory authorities to balance carefully, efficiency and stability trade-offs in the face of rapid changes, and ensure that trust is maintained in an evolving financial system.

She urged the authorities to calibrate regulation in a manner that appropriately addresses the risks presented by FinTech firms without stifling innovation.

In the days and years ahead, the big question will not be whether FinTechs have come to disrupt or complement banking operations, but which of the sectors controls the over N30 trillion assets and revenues that define Nigeria’s financial sector as a leader in the sub-regional banking businesses. The market will always favour operators that meet customers’ demand for speed, efficiency and security, in the delivery of financial services.

In a report by Ernst & Young (EY) entitled: “Unleashing the potential of FinTech in banking”, the multinational professional services firm, advised banks to determine how best to engage with FinTechs, given the contrasting sizes and cultures of their respective organisations. FinTechs also need to know how best to approach and navigate their way through banks.

EY said the most successful banks will be those that improve speed and reduce costs by collaborating with a range of different partners in building the strongest network.

To achieve the future state, the banks must unleash the FinTech potential in their own organisations – and both must forge ahead to get better to successfully drive innovation. There is no alternative to this collaboration to stay in business.

December 25, 2017