The Nation Newspaper

Tag: N20b

  • N20b Calabar Port contract sparks crisis

    N20b Calabar Port contract sparks crisis

    Shippers are pushing for a probe of the N20 billion Calabar Port dredging contract.

    The board of the Nigerian Ports Authority (NPA) approved the payment of $35 million (about N20 billion) to the company that won the controversial contract shortly before it was dissolved last week by President Muhammadu Buhari, The Nation has learnt.

    The payment, it was gathered, was made by the NPA, even as a legal battle over the contract was pending in court.

    The Nigerian Shippers Council (NSC) told reporters yesterday that the contractors had vanished.

    The amount is for two quarters – $20.5 million for the last quarter of last year and $14.5 million for this year’s first quarter.

    The contract, billed to last for two years, is worth about N20 billion.

    The nod for the contract, a source close to the Federal Ministry of Transport alleged, was given by the former President Goodluck Jonathan to the NPA, which bypassed the Bureau of Public Procurement (BPP).

    The BPP Act of 2007 empowers the agency to monitor public procurement, harmonise government policies and practices by regulating, setting standards and developing the legal framework and professional capacity for public procurement.

    The award of the Calabar port dredging, an official who pleaded not to be named, is one of the avenues used by the previous administration to siphon public funds through the NPA.

    Sources at the BPP said six firms – Jan De Nul, Dredging International, Westminster Dredging, China Harbour Engineering, Lagos Channel Management (CCM) and Van Oord – participated in the procurement after fulfilling the pre-qualification.

    The exercise, a source said, was nullified and a new one ordered, following an alleged attempt by Ministry of Transport and NPA officials to manipulate the process.

    Said the source: “The company that was awarded the contract by the NPA never participated in any procurement before it got it. The last procurement for the capital dredging of the Calabar Channel took place in 2010.

    “Soon after the commencement of the process, NPA stopped the exercise, citing Section 28 of the Procurement Act. That law stipulates that a procuring entity may reject bids before the acceptance of a bid, without incurring any liability to the bidder and cancel the procurement in the public interest, without incurring any liability.

    “But the Act does not say that NPA or the Federal Government can award the contract unilaterally, even if they reject or cancel the bids earlier submitted and that is where public concern becomes necessary.

    “The Act was also established before the Jonathan administration came into power to ensure the application of fair, competitive, transparent, value-for- money standards and practices and the attainment of transparency, cost effectiveness and professionalism in the public sector procurement system.

    “The question is, where was transparency and accountability in the award of the contract? How many companies were invited to submit bids and went through the procurement proceedings before the contract was approved by the then President? Where is the record of the procurement proceedings? Where is the input of Nigeria Institute of Purchasing and Supply Management, the Nigeria Bar Association and other critical stakeholders required by the Act?”

    But one of the three Executive Directors of NPA, a senior official of  the ministry alleged, was ordered to report to the office from abroad about two weeks ago, to perfect the documents for the release of the fund to the contractor.

    “Of this amount, $7.5 million (about N1.5 billion) was paid before the board was dissolved last week and $27.5 million (about N5.5 billion) balance is billed for payment.

    “One of its Executive Directors was asked to report to the office from the United Kingdom about two weeks ago to pay NPA’s equity contribution of N120 million in Calabar Channel Management Limited, which was incorporated two years ago for securing the capital and maintenance dredging of the Calabar Port.”

    Calabar Channel Management Limited is a partnership between NPA and Niger Global Engineering and Technical Company Limited. The company is said to be owned by a Peoples Democratic Party (PDP) senator.

    The decision to recall the ED was initiated by a former Minister in the Jonathan administration. His aim was to strengthen the hold of the contractor on the job and safeguard his interest in Calabar Port before another Minister and a new board would be constituted by President Buhari, The Nation learnt.

    The source said: “The former minister and the NPA board took advantage of the delay caused by President Buhari in dissolving boards of parastatals to hatch their plan for the payment of the contractor and NPA’s share capital in the firm.

    “These bills were not paid since last August, when the contract was awarded. It was the refusal of a former NPA Managing Director (MD) to make the payments or represent the NPA on the board of Calabar Channel Management that cost him his job.

    “The former MD had cited the irregularities in the award of the contract and weary of falling foul of the law, given that there is a pending suit challenging the contract. NPA is the fourth defendant in the suit and is being represented by a legal team.

    “Officials of our ministry were shocked that a former NPA chairman, who was the first to condemn the attempt to manipulate the maintenance dredging contract in favour of the contractor, did not raise a voice against the decision to make these payments.

    “The Chairman had an alarm then that the consortium has no reference whatsoever of previous jobs done. They were alien to the Calabar channel project and did not even take part in the bids of 2010 and the later procurement.’’

    “The consortium was not prequalified and did not pass through the selection like other companies. It, therefore, follows that the presidential approval for the appointment of the consortium led by Niger Global Engineering and Technical Company Limited to enter into a joint venture with NPA, which culminated in the agreement to form Calabar Channel was obtained without following due process,” the source said.

    This is the fourth controversial attempt at making Calabar River navigable. Two of them occurred under the Jonathan administration.

    Efforts to get the Assistant General Manager, Public Affairs of NPA, Mr Musa Ilya on phone proved abortive. His phone was off and he did not reply a text message sent to him on the issue.

    Besides, CCM officials were also not available.

     

  • CBN: banks lost N20b to frauds in six months

    CBN: banks lost N20b to frauds in six months

    The Central Bank of Nigeria (CBN) has traced rising cases of e-fraud in international card transactions to increased insider abuse. The fraud where perpetrated through theft and authorisation, it said.

    CBN’s report for the first half of 2013 contained in the ‘KPMG 2014  Customer Satisfaction Survey’ indicated that there were 2,478 fraud and forgery cases valued at over N20 billion. The figure represented an eight per cent increase over the previous year, and represents a significant increase in value of over 200 per cent from the 2012 figures.

    The report showed that two per cent of retail bank customers were defrauded in the last one year.

    CBN Director, Banking and Payments System Department, ‘Dipo Fatokun, said increased use of automation in most payment processes escalated the insider abuse because of banks’ weak authentication procedures.

    He said frauds were rampant when international hybrid cards issued by Nigerian banks are used in non-EMV environments, like the United States.

    EMV stands for Europay, MasterCard and Visa, a global standard for interoperation of integrated circuit cards for authenticating transactions.

    He advised banks to collate all their card frauds abroad and send to CBN not later than Friday. It also directed that all data on card-fraud occurring abroad should be rendered on the Nigeria Interbank Settlement System (NIBSS) fraud portal.

    He directed banks to implement a maker/checker control structure for all payment platforms, including account and database system maintenance on core banking systems. The lenders, he said, are to implement two factor authentication at login points for applications driving transfers, withdrawals, deposit, standing order, account maintenance and system maintenance processes.

    He said: “An implementation plan should be submitted to the Central Bank by January 30 and all banks are expected to fully comply by December 31, failing which defaulting banks would incur a penalty of N50,000 daily.”

    He said from next month banks would ensure that, only customers who indicate their intension of travelling to non-EMV jurisdictions would have their cards default to the magnetic stripe and for the period indicated by the cardholder only. To this end, banks should ensure that their customers are adequately educated.

    Meanwhile, the naira recovered from a record intraday low after two commercial lenders and an energy company sold dollars on the interbank market ahead of a CBN interest rate meeting, dealers said.

    The two lenders and Nigeria’s LNG sold an undisclosed amount of dollars, helping the naira to gain 2.3 per cent against the greenback to N187.50. The naira had earlier hit a record intraday low of N191.85 to the dollar.

    Dealers said the lenders had to sell dollars to remain within a regulatory open limit position on hard currency set by the CBN, while the energy company bought naira for its local operation.

     

  • Fraud, forgery hit N20b, says KPMG report

    The Central Bank of Nigeria’s (CBN’s) report for the first  half of last year has shown that there were 2,478 fraud and forgery cases involving banks valued at over N20 billion, a report by KPMG has said.

    This, it said, represented an eight per cent increase over the previous year volume but a significant increase in value of over 200 per cent from 2012.

    The Banking Industry Customer Satisfaction Survey by KPMG obtained by The Nation said increasing frequency and magnitude of cybercrime incidents globally make it apparent that cybercrime is here to stay.

    It said with a yearly growth rate of three per cent over the past five years and $21 billion inflow of personal remittances last year, Nigeria is the fifth largest remittance receiver worldwide in terms of volume.

    It said remittance to Nigeria accounts for 65.6 per cent of total flows into sub-Saharan Africa.

    The feat, it said, presents some opportunity for banks who may want to tap into the opportunities created by this class of Nigerians who wish to transact banking business using their local bank accounts.

    In an online survey of 127 Nigerians resident across 12 countries who maintain local banking relationships, convenience was the overwhelming driver of value.

    According to the report, when asked for the most important factor in their banking relationships, 44 per cent of the customers selected the availability of internet banking. In particular, customers identified the ease of use of the internet banking platform as the most important factor followed closely by the quality of customer service.

    Interestingly, 77 per cent of those surveyed transfer money through formal channels – banks (48 per cent) or through other money transfer agencies (29 per cent) – compared to 19 per cent who said they typically send money home through less formal ways.

    Also, on the effectiveness of the contact centre, the ease of complaints resolution was cited as a major area of dissatisfaction.

    It said more than 50 per cent of customers who have used their bank’s contact centre have been dissatisfied with the promptness of issues resolution and quality of feedback. It cited one bank’s  response to a customer facing some debit card challenges was for the customer to wait until his next visit home, for his query to be resolved.

    In this year’s survey, two per cent of retail customers indicated that they had experienced a fraud incident in the last year and while this number appears small today, it may signify the start of a potentially disturbing future trend.

    It said a survey by KPMG in the Netherlands showed 80 per cent of the respondents indicated that cybercrime is no hype and will continue to be a challenging topic.

    The survey showed that 49 per cent of organisations have experienced some form of cybercrime activity during the past 12 months, stressing that it is not to say the rest have not experienced an attack; they may not have the proper detection measures in place.

    Among the 49 per cent that have experienced an attack, 10 per cent indicated that they have been attacked more than 100 times within the past year. Inadequate detection procedures may conceal the real number of cybercrime attacks. Only 50 per cent of the respondents were able to detect attacks and only 44 per cent of the organisations felt comfortable that they were able to respond.

    It said organisations should ask themselves whether they are aware and capable of handling a cybercrime attack. The survey found that 35 per cent do not agree that their organisation is sufficiently aware of cybercrime, although the financial sector respondents score significantly lower. This would imply that financial institutions are more aware of cybercrime than other typologies.

    Attacks may come by various methods heavily on and correlate with the budgets that have been made available. The damage from cybercrime attacks and budgets allocated to cybercrime defence can be substantial.It said the way  cybercrime defence budgets are allocated for prevention, detection and response measures should be considered carefully.

  • Fraud,forgery cost banks N20b, says survey

    Banks lost over N20 billion to frauds and forgeries between January and June, last year, according to a survey.

    There were 2.478 fraud and forgery cases valued at over N20 billion during the first half of last year, the KPMG Nigeria 2014 Customer Satisfaction Survey on Fraud and Forgery said.

    The figure, it said, represents an eight per cent increase over the previous year’s volume and indicates a significant increase in value of over 200 per cent from 2012.

    On cybercrime, the report said at two per cent of retail customers indicated that they were fraud victims last year, adding that while this number appears small today, it may signify the start of a potentially disturbing future trend.

    The battle against cybercrime is a typical example of a rat-race that is difficult to win, it said, adding that the least one can do is to try to stay as up to-date as possible.

    According to the report, an overwhelming number of corporate customers (95 per cent)     rated security of their online corporate solution as their most important element of online banking, followed by the ease of use, and convenience.

    “When questioned specifically on their level of comfort with the quality of online banking security, only 50 per cent of customers reported strong satisfaction levels, others were of the opinion that there was room for further improvements,” it said.

    For Chief Financial Officers (CFOs) and Treasurers of corporate organisations, banks will need to focus on two priority areas to further improve user experience and meet the evolving needs of corporate users.

    Corporate customers, such as CFOs and Treasurers, want banks to recognise the changing nature of their roles so as to provide appropriate support, especially in the area of reporting. This specific class of customers desires greater flexibility and options for customising financial reports.

    The report identified lack of sufficient detail in reporting of transactions as well as the inability to see at a glance, a consolidated view of all banking transactions and accounts across different banking relationships.

    “Increasingly, real-time data is crucial to corporate planning, forecasting and decision-making. Thus, it is clear why corporate customers are demanding that banks provide reliable and accessible real-time data.

    A number of the corporate respondents suggested that more banks should build capabilities to support integration between Enterprise Resource Planning (ERP) platforms and banks’ proprietary e-payment solutions, thereby minimising the need for manual intervention and ultimately reducing the risk of errors,” it said.

    KPMG said corporate customers continue to complain that banks need to invest a lot more towards a deeper understanding of their businesses and industry. That way, they feel that banks will be able to support their needs in a more proactive and comprehensive manner.

    However, when questioned on banks’ ability and responsiveness towards designing fit-for-need solutions, only 29 per cent of corporate customers expressed satisfaction with their bank’s ability to tailor solutions to their needs.

    In the three segments, product suitability was rated as one of the most important service measures for customer satisfaction. While the retail and SME customer segments reported slight increases in satisfaction with product suitability, their interest in loans against satisfaction remained  unchange in the corporate segment.

    “For corporate bodies, there was some improvement in satisfaction levels with the quality of e-payments and collections capabilities. In our estimation, we feel that the issue may not necessarily be that quality has declined — in many instances, banks have made considerably more investments — it is that customer expectations have increased,” it said.

    Access to credit remain, it said, a significant challenge for retail and Small and Medium Enterprises (SME) customers. Despite majority of customers in both segments expressing interest in accessing loans, only about two in ten customers are very pleased with the ease of access to credit facilities.

     

  • Bayelsa saves N20b

    • State to increase IGR

    Bayelsa State Governor Seriake Dickson has said the state has N13.433 billion as the gross inflow in November.

    Dickson spoke at the monthly transparency briefing, tagged: “Bayelsa State Transparency Initiative” monthly briefing for November, which took place at the Banquet Hall of the Government House, Yenagoa.

    He said of the amount generated, N2.395 billion was from statutory allocation, N9.572 billion came from the 13 per cent derivation accruing to the state. VAT got N625,326,631; disbursement from SURE account N1.65billion.

    He said the total deductions in the same month amounted to N2.3 billion.

    Putting salaries for political appointees at N327million and the monthly overhead for ministries and agencies at N1.6 billion, Dickson said “even this figure will be reduced by next year”.

    He recalled that a balance of N23.572 billion was brought from October, and when added to the total capital payments for the month it amounted to N9billion and that of recurrent at N2 billion, the total funds available for November was put at N20,89,108,172,38.

    “Because of the robust development agenda, enthusiasm and commitment, some concerns have been expressed whether we are not doing too much.

    “The truth is people find it difficult to believe that all these are possible but it is possible with dedication, commitment, discipline and prudent management of scarce resources a lot can be done.”

    Highlight at the briefing was the signing of a N31.3 billion contract awarded to a Chinese firm for the Yenagoa-Oporomo road.

    He emphasised the importance of opening up the major link roads to the riverine areas, including the Nembe-Brass road, which will lead to the Brass LNG project; the Ekeremo-Agge Road which is also the site for the deep sea port.

    Another contract awarded included the Sagaba-Ekeremo Road.

    As part of measures to boost the state’s revenue profile, the governor has constituted the state board of internal revenue with Torukuru Godson as its chairman.

    Speaking at the inauguration at the Government House, Dickson urged the board to develop new revenue streams and work out modalities to block all leakages and wastages.

    The governor, who described the board’s assignment as critical to the administration’s restoration agenda, urged it to work closely with the Ministry of Finance and a committee, headed by Deputy Governor Gboribiogha John Jonah.

    Lamenting the state’s low Internal Generated Revenue (IGR), the governor noted that his administration would not depend on federal allocation to execute its infrastructural development initiative.

    “I don’t see any reason why multinational companies operating in the state with the massive degradation they wreak on our environment will not pay tax to our state…. Where we need amendment of the law, work with the Attorney-General that I have already mandated so that we can create an enabling legal environment when necessary.”

    Others members of the committee are Mrs. Ezougha Ogborodi (Legal Adviser and Secretary), Anthony Ikobho, Felix Pere-Kalama, Joseph Freeman Isowo and Anthony Audy with two directors to represent the Inland Revenue Board.