Don't Miss


Home   >   Business   >   Industries   >   Economy   >   ‘N 422 bn in Subsidy Fraud to be Refunded to Federal Government’ – Aig Imokhuede led Committee

‘N 422 bn in Subsidy Fraud to be Refunded to Federal Government’ – Aig Imokhuede led Committee

By on June 28, 2012

The Fuel Subsidy Claims committee headed by Managing Director of Access Bank, Aigboje Aig Imokhuede has recommended in its report that N 422 billion be refunded to the Federal Government by oil marketers.

The committee includes other notable personalities such as MD of Stanbic IBTC, Mrs. Sola David-Borha; Director General, Budget Office of the Federation, Dr. Bright Okogu; Dr. Director General, Debt Management Office, Dr. Abraham Nwankwo; Accountant General of the Federation, Mr. Jonah Otunla; and Executive Secretary, Petroleum Products Pricing and Regulatory Agency (PPPRA), Mr. Reginald Stanley.

Other members included former Group Executive Director, Finance and Accounts, Nigerian National Petroleum Corporation (NNPC), Mr. Michael Akorodare; Deputy Director, CBN, Mrs. Onyinye Ahuchogu; Mrs. David-Borha; National Secretary, Independent Petroleum Marketers Association of Nigeria (IPMAN), Mr. Mike Osatuyi; and Executive Secretary, Major Marketers Association of Nigeria (MOMAN), Mr. Obafemi Olawore.

The report was submitted to the Presidency on Tuesday and showcased how the audit committee discovered 17 methods used by oil marketers to defraud the government of hundreds of billions of Naira.

According to the report, they are itemized below:

  1. No evidence of sales proceeds in the banks – N157,549,854,482.55, meaning that the marketers did not have evidence of sales proceeds based on banks’ available records at the date of verification;
  2. Subsidy payments without the signatures of external auditors and independent inspectors on shore tank certificates – N121,897,757,962.56;
  3. Subsidy payments for which mother vessels were not found in locations claimed at the time of transshipment – N21,361,071,313.24;
  4. Subsidy payments for which there were no shipping documents or evidence of payment for the products in foreign exchange – N20,463,525,859.79;
  5. $10 additional margin given to traders from November 2010 to 2011 with approval of the Federal Government contrary to the Petroleum Support Fund (PSF) guidelines;
  6. Specially mentioned transactions with various infractions – N15,944,918,661.23;
  7. Use of 1 per cent as bank spread instead of the maximum 50 kobo approved by the CBN in computation of foreign exchange rates used for subsidy payments – N14,021,193,230.89;
  8. Subsidy payments for which the mother vessels could not be traced – N12,942,254,466.24;
  9. Transactions disclaimed by banks – N12,154,918,932.18;
  10. Subsidy payments without proof of existence of the mother vessel bill of lading or daughter vessel bill of lading – N11,762,998,358.89; and
  11. Subsidy payments for which mother vessels were no longer operational at the time of transshipment – N8,138,502,416.70.
  12. Subsidy payments for which there was no copy of the bill of lading for ship-to-ship transfer – N4,634,317,239.53;
  13. Payment of subsidy claims with no mother vessel bill of lading in the file – N1,938,927,804.98;
  14. Subsidy payments for which mother vessels were located in the Far East (China) and in the South Pacific when transshipment took place off the coast of Cotonou – N1,713,787,473.21;
  15. Differences between subsidies advised by PPPRA and subsequent verification by external auditors – N747,534,804.00
  16. N20 million re-engagement fees not charged for non-performance by marketers – N200,000,000
  17. Difference between the volume on the shore tank certificates and the volume used for the subsidy payment – N33,383,300.79.

The oil marketers that committed these infractions have been asked to refund the subsidy payments they received unless they can provide contrary evidence to the report of the audit committee.

2 Comments

  1. Gbamo Maxwell

    June 28, 2012 at 11:31 am

    If all this is true what stops the FG from jailing these individuals.

  2. Aminu dankakalo

    June 30, 2012 at 6:40 am

    What a selfish committee with almost , no northerner no Muslim . Mr president most be joker,Nigeria is not only for south south, people are watching your steps be careful.