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Subsidy Fraud: Aig-Imoukhuede led Committee Indicts 21 Firms on N382 billion

By on July 25, 2012

The Aig-Imoukhuede led committee charged with verification and reconciliation of fuel subsidy claims and payments has indicted 21 firms of committing subsidy fraud to the tune of N 382 billion and recommended their prosecution to the Presidency.

Addressing State House correspondents in Aso Villa yesterday after the committee tendered their report to the President, the Chairman said the companies involved were 21 and refused to reveal their identities.

He disclosed that the committee also recommended total deregulation to the Presidency as the way out of the subsidy fraud.

The committee chairman  said, “There were 116 oil marketing and trading companies, which I will call OM&T during the course of this interaction, that participated in the petroleum subsidy scheme in the period of review.

“The presidential committee invited all the 116 for interviews; 107 OM&T honoured invitation. They were interviewed by various panels constituted by the committee and the outcomes of these interviews are also captured in the report.

“Out of the N422bn identified by the technical committee which I chaired, the presidential committee took step to identify and remove duplication, which may have been contained in the technical committee’s report, which was also discovered in the course of the panel’s interviews.

“Of the N422bn, N18bn was found to be duplication. So, the actual amount that was being verified is N403bn. Of this amount, N21bn was cleared and that leaves N382bn as the sum in contention for which the committee recommended that the process of recovery should be made.

“Painstaking efforts were made to ensure fairness. OM&T were given the opportunity to come back with as much documentation and even be re-interviewed where necessary.

“We have six categories of issues, likely fraudulent cases for criminal investigation-you have 21 OM&T affected. We have short-time certificate issues, you have as number of OM&T involved in irregular payments and so on.

“There are 22 recommendations made by the committee. I will like to summarise them as follows: Obviously, the first is the recovery of the said amount. The next is possible criminal investigation and prosecution of the OM&T that are found to have engaged in likely fraudulent issues.

“Also, the external auditors and any government functionaries who served will be further interviewed to determine the roles if any in the issues that were discussed.

“We also recognise the need for the accelerated implementation of all the recommendations in the technical committee’s report.

“It is important to note that the fuel subsidy scheme involved the sourcing, importation and distribution of petroleum and other related products within Nigeria.”

He said the committee had built an airtight case that would be difficult to challenge in court, and he said the President displayed unique wisdom in staffing the committee with technocrats who have vast experience.

“We believe that at this juncture and based on the recommendations of the committee, Nigerians will begin to see the Federal Government take the action that is visible having gone through the invisible hardwork of putting together the cases against those who may have misbehaved in the fuel subsidy programme.

“Finally, our recommendation is that for the nation to keep putting together teams of technocrats to pursue those who abuse a subsidy regime is not sustainable. The lasting and final solution to ensure that this kind of thing does not occur again is for the deregulation of fuel subsidy,” he said.