Trial Of Former Bank Chief, Erastus Akingbola Begins Afresh
The former Managing Director of the defunct Intercontinental Bank Plc, Dr. Erastus Akingbola was on Tuesday re-arraigned before Justice Mojisola Olatoregun over allegations of fraud one year after he was ordered by the Supreme Court to return to the Federal High Court in Lagos to face his trial.
Akingbola was first arraigned before Justice Mohammed Idris on August 13, 2010 on a 26-count charge of fraud, granting reckless credit facility, abuse of office and mismanagement of depositor’s funds.
He was also accused of creating or causing to be created a false or misleading appearance of active trading in the shares of Intercontinental Bank on the Nigerian Stock Exchange by approving utilisation of N179,385,000,000 of the bank’s funds for the purchase of the bank’s shares between November, 2007 and July, 2008.
The offence is said to be contrary to Section 105(1) (a) of the Investment and Securities Act 2007 and punishable under Section 115(a) of the same Act.
He pleaded not guilty to the charge.
The case was later transferred to Justice Charles Archibong on October 25, 2010, but two years later, the judge struck out the charge for want of diligent prosecution by lawyers to the Economic and Financial Crimes Commission (EFCC).
However, on 20th February, 2015 the Court of Appeal, Lagos Division overturned the Federal High Court’s decision striking out the charges against Akingbola.
Akingbola appeal to Supreme Court was also dismissed by the apex court, who on May 18, 2018, ordered the former bank chief to return to the Federal High Court to answer to the charges slammed on him by the EFCC.
At the resumed hearing of the matter on Tuesday, a prosecution witness told the court that Akingbola had only 10, 000 pounds in his domiciliary account before he allegedly transferred the bank’s 8.5million pounds into the account domiciled in England.
Jimoh, a former Chief Inspector of the defunct bank further testified that the illegal transfers were made between the March 16 and May 13, 2009, and that Akingbola used Inter- Capital Market Limited (ICML), a subsidiary of the bank to carry out the transaction by unilaterally increasing its lifeline from N2 billion to N5 billion.
He claimed, “They had a lifeline of N2 billion which as at the time of this transaction had been completely used. On March 11, 2009 ICML applied for an increase from N2 billion to N5 billion. The application was made to the ED investment and strategy (intercontinental) the request was recommended and approved by the ED.”
According to him, the normal process was for the Board Risk Committee of the bank to ratify and approve such a request when it was a necessity, adding that “In this case there was no approval or ratification.”
Jimoh stated further in his testimony that it was from this increase that ICML gave N2.1 billion to another company, Mega Investment Company Limited, belonging to Dr Raymond Obieri, Chairman of Intercontinental bank.
The witness also alleged that the N2.1 billion was distributed to some bureau de change operatives who converted it to foreign currencies after exchanging it with their customers, and that 8.5 million pounds was paid by one Loveth into the account of Fulgher, a United Kingdom based company in charge of leasing Intercontinental bank offices with Royal Bank of Scotland.
According to him, the money was later transferred to Akingbola’s domiciliary account which was an irregular banking practice.
He said, “What we observed is that as the time of the transfer of the 8.5 million pounds to Scotland, Akingbola did not have sufficient amount in his domiciliary account. He had only 10,043 pounds in his account. Ordinarily, banks do not transfer fund to customers whose accounts are not credited and the bank does not transfer funds from its NOSTRO account either.”
He said a substantial part of the Inter-Capital Market Limited N2.1 billion was credited to this company via the transfer of the Fulgher account of Scotland, adding that the bank had no transaction with Fulgher on such an amount and therefore the transaction was not a transaction of the bank.
Jimoh, who was led in evidence by the prosecuting counsel for the EFCC, Rotimi Jacobs (SAN ), said, “The management of the bank gave me a letter dated May 8 , 2009 , from Tropics Securities Nigeria Limited, a company owned by Dr Erastus Akingbola, his wife and some other shareholders.
“The letter was addressed to the Group Managing Director, Dr Erastus Akingbola, and the letter was signed by one Mr Bayo Dada and one Jackson.
“The letter was claiming payment amounting to N10 bn for shares purported to have been bought by the bank.”
The investigator said based on the letter, Intercontinental Bank issued three cheques amounting to N 10 bn in favour of Tropics Securities Nigeria Limited.
He said, “Upon further investigation, I discovered that the cheques were cleared in Access Bank for Tropics Securities Nigeria Limited and Tropics Properties Limited. Dr Akingbola has substantial interests in these firms.
“Further investigations revealed that the money was used to clear Dr Akingbola’ s indebtedness to Access Bank.”
When asked by the prosecutor, Jacobs, whether the N10 bn was a loan from Intercontinental Bank to Akingbola, the witness said, “There was no loan granted to any of the companies or Dr Akingbola but they claimed it was for shares.”
The first prosecution witness, who is a bank examiner with the Nigerian Deposit Insurance Corporation (NDIC), Paul Ndubuisi, had earlier tendered a report containing outcome of investigations carried out by his team on the bank’s books in 2009.
Ndubuisi had also told the court that the loan to deposit ratio of the bank was 107 percent which is higher than the statutory 48 percent.
The witness added that the quality of the bank’s asset was low owing to the fact that about 48 percent of the total credit portfolio was non-performing.
Under cross-examination by Akingbola’s lawyer, Chief Wole Olanipekun (SAN), the witness disclosed that he was not the person that made the report available to the EFCC.
Asked why the investigation was carried out when Akingbola was on annual vacation, the witness said, “On 18th June, 2009, we moved to the bank for the examination. We were informed that the MD was on annual vacation. The MD’s absence did not stop us from commencing our examination. This was because the bank is an entity on its own.”
He added that he was not aware if the report was later forwarded to the bank for its response.
Justice Olatoregun adjourned further proceedings till Wednesday.
