Hadiza Bala-Usman In N20bn Contract Scam

BY EDMOND ODOK – Is it true that President Muhammadu Buhari axed the embattled Managing Director of Nigerian Ports Authority (NPA), Hadiza Bala-Usman from office over accusations of corruption and gross abuse of office?

These and many other disturbing questions around an alleged 20 billion Naira contract scam are the issues on the plate for an Administrative Panel of Inquiry to investigate the Bala-Usman-led NPA management team.

According to inside sources, the Authority under Hadiza’s watch is enmeshed in allegations of massive financial fraud and misappropriation as uncovered by an ‘audit query’ covering a three year period between 2016 and 2019.

Hinting at the current scandal rocking the NPA, one of the sources said the now troubling audit reports indicated that expenditure by the management during the period under review kept rising so astronomically with no regards to existing financial regulations.

Consequently, the audit report by the Office Auditor General For the Federation (OAUGF)’s office have raised queries on various sub-heads with unexplained financial entries. Observing that the Authority’s books are seriously sprinkled with discrepancies, accounting errors, and financial irregularities, the OAUGF said in its reports that the suspended NPA Chief Executive has lots of questions to answer for gross “betrayal of public trust”.

Importantly, the audit query, which cited various discrepancies in the financial records, stated that Hadiza Usman-Bala flagrantly abused due process in running the agency, citing the non-remittance of Value Added Tax (VAT) deductions to the Federal Inland Revenue Service (FIRS) as one of the serious infractions.

Noting that the outstanding VAT deductions are in several billions of Naira as well as foreign currency denominations, the query listed deductions not remitted to FIRS as N3,667,750,470; £252,682.14;  $148,845,745.04; and Euro 4,891,449.50

An insider claimed that in superintending over NPA, Hadiza shot herself in the foot by recording excessive increase in administrative and operational expenses; extra budgetary expenditures; under disclosures on hotel accommodation; inflation of figures on Corporate Social Responsibility (CSR) projects; and diversion of funds through the Nigerian Port Today; as well as sponsorship of National Assembly (NASS) programmes among others.

It was gathered that piqued by the worrying developments, the audit queries, covering  over 100 different areas, recommended that the suspended Managing Director be made to refund various sums to the government purse, particularly on areas where there are no relevant documents to justify such expenditures by the management team.

Also, the Audit report, in reviewing NPA’s policy on CSR projects/programmes, discovered that records relating to CSR fell short in complying with the Public Procurement Act 2007.
It said that in 2016, the Authority spent N286,412,628.00 on CSR with the figure rising to N2,496,248,775.00 and N5 billion in year 2017 and 2018 respectively.

In the process, it was discovered that “beneficiary needs were not properly assessed or identified before the implementation of CSR projects/programmes” with the Audit team querying the evident non-compliance with public procurement Act.

Besides noting that most of the CSR projects/programmes were inflated, the report also submitted that the “sum of N5.18 billion should be recovered from the Managing Director, being the value of, inflated figure as approved by her office.

Another area where the damning audit report also rang the alarm bell is the alleged “diversion of N369.71 million through the Nigerian Ports Today”, which is the Authority’s official in-house publication.

The report noted that; “Payments to Nigerian Ports Today were reviewed to confirm whether they were properly initiated, authorised processed, documented and paid in line with the Public procurement Act 2007”.

But most disappointingly, the query said; “findings revealed the sum of N369,718,130.82 was paid to Nigerian Ports Today, a Limited liability company that is fully owned and controlled by NPA during the period under review. There was no evidence of contractual relationship in the form of award of contract to the company nor was there anything to show the company rendered services to the Authority to justify these payments and concludes that the Authority paid the company without a contract and thereby contravening the Public procurement Act 2007, and that this was viewed as a means to divert public funds.”

Another specific area that also attracted Audit query include various expenditure incurred by the Authority on behalf of Minister of Transportation, Rotimi Amaechi with claims of over $604,598.95 recorded without necessary supporting documents.

Baring its fangs at the embattled NPA boss, the report recommended that she should refund all the amount involving unexplained expenditures to the government coffers.

Some News portals also quoted sources at the OAUGF as saying the audit queries touched on all units and departments within the Authority, hinting that “massive over invoicing and flagrant disregard for due process were uncovered. In all, at least a mind-boggling N20 billion of NPA’s financial transactions between 2016 and 2018 could not be traced, documented, or explained.”

“The committee also observed that delivery of CSR items were not accompanied with delivery letters and that inmost cases, there was no evidence of actual items delivered and who signed for them.

“The NPA boss and accountants have been perpetrating a gigantic, unconstitutional accounting fraud, deliberately cooking the books to mislead the government and drive the NPA’s budgets ever higher, regardless of port necessity. The NPA has literally been making up numbers in its annual financial reports to the National Assembly—representing billions of dollars’ worth of seemingly nonexistent transactions, knowing that the National Assembly would rely on those misleading reports when deciding how much money to give the Authority.

“The fraud works like this, for instance while a contract with Ref. HQ/GM/PROC/CON/C.11/PBT/16/322 dated 16/10/17 was awarded in favour of Messrs Ecomaxx Engineering Projects Ltd for the supply of items to the old people’s Home Yaba, Lagos to the tune of  N19,760,460.00 which was paid vide invoice no HQ/CS/0711 dated 01/06/17 there was no documentary evidence that the items were indeed delivered to the Home. In the same vein, the contract for supply of items to Yaba children’s orphanage followed the same pattern.

“For instance, whilst a contract awarded in favour of Trans-secure Ltd was N19,467,000.00 the survey conducted by the audit team found out that N6,520,500.00 was the actual market price. This NPA expenditure fraud is déjà vu all over again for Spinney, prompting the office of the OAUGF to demand an explanation from Hadiza Bala Usman reasons for the sharp excessive increase in the Authority’s expenditure profile between 2016 and 2018.”

Other issues on the table for examination include over-bloated increase in expenditure on local and foreign medical expenses; legal fees; Corporate souvenirs; and expenditure on other government agencies that went up from N50.29 million in 2016 to N338.59 million in 2017, representing about 573 percent increase.

However, a top presidency official said given the damning revelations contained in the audit reports, the Administrative panel is therefore expected to urgently scrutinise all the allegations to enable the government take necessary actions on those found culpable.