The Senate Public Accounts Committee (SPAC) yesterday gave the Nigerian Maritime and Safety Agency (NIMASA) 48 hours to present to it documents authorising the payment of $5million to a law firm for a service not rendered.
The committee, chaired by Senator Matthew Urhoghide (Edo South), had invited the management of NIMASA to explain why the $5 million was paid for a service not rendered.
The representative of NIMASA, Olamide Olusanya, told the Committee yesterday that the matter was presently a subject of litigation in court.
But, the Committee rejected the explanation and asked the agency to make presentation on the information at their disposal on the payment of legal fees to the law firm.
Olusanya explained that the agency was directed by then Attorney-General of the Federation to pay the $5million legal fees.
Urhoghide, however, asked the representative of NIMASA to present any letter that authorised the agency to pay $5 million for legal fees.
In his response to whether the Presidency directed the agency to pay the legal fees, the NIMASA official said there is no such letter adding that they only have a letter from the Senior Special Assistant to the President on Administration authorising the payment.
The Committee, therefore,directed the agency to present documents relating to the payment by Thursday this week to enable the Committee take a final decision on the matter.
Urhoghide said: “We need the details of the payment, you go back to your archives and bring them out.”
On his part, a member of the Committee, Senator Abdullahi Danbaba, insisted that there was no basis to have made the payment adding that the money should be recovered from the law firm.
“Let us know the transaction between you and AGF before you paid the money,” Urhoghide added.
It was learnt that the Committee had earlier extended three invitations to NIMASA concerning the payment of $5 million as professional fee and also to give details of $9.3 billion loss by the Federal Government, but the agency allegedly did not honour the summons.
The office Auditor-General of the Federation had queried the agency for refusing to present the breakdown of the sum of $9.3 billion loss by the Federal government for thorough scrutiny.
According to AuGF’s report, the money was paid from Zenith Bank (UK), dollar account.
The query reads: “Audit observed that the agency engaged the service of a legal firm through a letter with reference number NIMASA/DG/KP/2014/001, dated 24th January 2014 for the intelligence based tracking of global movement of Nigerian Hydro-Carbon and recovery of loss by the Federal Government of Nigeria in the sum of USD9.3billion between 2013 and 2014, with a start-off cost of USD5million and 5% of all sums recovered.
“Payment instruction with reference number NIMASA/2007/DFS/WJ/5.500/VOL.11/341 dated April 2014 showed that the firm was paid the sum of $4,523,809.52 net as professional fees from Zenith Bank (UK) Dollar account.
“The Naira equivalent of this amount was N741,904,761.28 at an exchange rate of N164 to a dollar as of that date.
“No evidence of recovery of either part or the entire sum of the 9.3 Billion US Dollars was presented as at the time of the Periodic Check in February 2018, despite the huge amount of money already paid to this effect.
“It is instructive to note that details of the transaction leading to the loss of USD9.3billion to the Federal Government which only came to audit attention through the review of the letter from the agency to the legal firm so as to ascertain what could have transpired, resulting in such a huge loss were not presented for audit.
“Ordinarily, the firm should have deducted its fees from the amounts recovered for the FGN, and not receive fees in advance in lieu of the recoveries.
“Audit is concerned that payments was made for service not rendered and this may be a deliberate attempt to divert government funds for personal use.”
“The Director-General is required to justify the payment for service not rendered, failing which the sum of N741,904,761.28 should be recovered from the legal firm and paid into the CRF (Consolidated Revenue Fund), forwarding evidence of payment to the Public Account Committees of the National Assembly and to the Office of Auditor-General for the Federation for verification. Sanctions stated in FR (Financial Regulation) 3104 should apply.
“He is also required to provide details of the transaction(s) leading to the loss of 9.3billion US Dollars for thorough scrutiny.”