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Finance committee uncovers massive tax fraud in banks

By on August 26, 2013
House of Reps

House of Reps

A House of Representatives Committee on Finance has exposed what it termed ‘massive tax fraud’ by 21 commercial banks in the past seven years.

The committee, which has been probing tax payments to government coffers by banks between 2006 and 2013, Sunday said the latest exposure was part of the findings of its investigation.

Chairman of the committee, Rep. Abdulmumin Jibrin who gave this shocking revelation in Abuja yesterday, said commercial banks have dubiously turned taxes collected on behalf of the government into another venture.

According to him, “balances reported in the published audited accounts of some banks show huge variance with the figures submitted to the committee, and data submitted to the CBN in their monthly returns on the same issues were found to be different from what was tendered before the committee.”

The chairman who failed to mention the amount involved, disclosed that, “It is obvious that over the years, government has lost billions of naira in fraudulent and underhand dealings corruptly designed by some banks to evade tax. This is in addition to being massively and callously short-changed by banks saddled with the responsibility of collecting and remitting taxes.”

Jubrin said there were inconsistencies and huge variances in some data provided in different pages of documents submitted to the committee, thus making it “to conclude that many banks blatantly engage in the creative accounting technique of inflating their operating costs to reduce their exposure to taxes.”

“Preliminary findings show a poor quality of returns by the Banks, discrepancies in data submitted, outright refusal to present documentary evidence and blanket violations of existing laws, self exemption from existing rules, false declaration, manipulation and distortion of information among others.

“There are also many cases of late remittances or outright failure to remit money collected on behalf of government. These despicable acts of gross misconduct clearly depict the unscrupulous and roguish character of some banks and their chief executive officers. For the Committee on Finance, this is unacceptable,” he added.