•Wants Public Officials On Debtors’ List Declared Bankrupt
Management of the Asset Management Corporation of Nigeria (AMCON) and Judges of the Federal High Court of Nigeria (FHC), were at the weekend challenged to explored the AMCON Act (as amended) to declare public office holders indebted to the corporation bankrupt.
This, according to a legal consultant and Senior Partner, Olaniwun Ajayi -LP, Muyiwa Balogun, has become the only alternative to enhance recovery of the over N5.4tr outstanding debt which is proving herculean and a source of pain to the Federal Government.
In a review of the new AMCON Act 2019 at a one-day Seminar for judges of the FHC in Abuja, Balogun warned that the debt profile can easily soar to a whopping N6.6tr by 2024.
A breakdown of the figure, he noted, showed that AMCON still owed the Central Bank of Nigeria (CBN) N4.5tr, just as it is still battling with the N1.7tr worth of Assets Under Litigation (AUL).
This debt, he explained, will eventually become the burden of the federal government and by extension taxpayers, which is why he urged the FHC judges to take the matter as a national assignment and explore all the powers of the new amendment, in view of the corporation’s impending sunset.
He stressed the need to speed up the court processes, pointing to the immorality of allowing the obligors to go away without punishment, especially since both the Holy Bible and the Quran, which incidentally are the dominant religions in the country abhor people who borrow without the intention to repay.
“The Bible in the book of Psalm 37:21 said, “The wicked borrow and do not repay.” In Proverbs 22:27, the Bible also said, “If you have no money to pay, even your bed will be taken from under you…”
The Quran on the other hand in Surat Al-Baqarah: 280 – 282 said, “Whoever borrows money and he intends not to repay it off is a thief.”
Backed by these, he stated that there are no legitimate means adopted by AMCON and its agents to recover the debt as mandated by the Amended AMCON Act that can be termed as draconian.
Balogun wondered what would have befallen the already challenged Nigerian economy, if the debts were not recovered in good time before the sunset, a situation he believes will not be possible without the support of the Federal High Court judges and indeed the judiciary.
According to him, “once you are declared bankrupt, you cannot hold public office. Today, we have AMCON debtors making laws for the Federal Republic of Nigeria. AMCON with your support needs to go to court and declare such individuals bankrupt. Given the sunset period of AMCON and the fact that the debt we are talking about is the commonwealth of Nigeria, it would not be out of place to take full advantage of the bankruptcy power among other special powers in the new amendment.”
The bankruptcy proceedings, he continued, have been explored in other climes to address similar matters arguing that there was no reason why it should not work in Nigeria.
“As a way of being proactive with the new amendment of the AMCON Act, let us test the bankruptcy proceedings because it will be effective. In other jurisdictions, this has proved to be a very potent tool, and why not in Nigeria,” he wondered.
The new 2019 Amended AMCON Act, signed into law by President Muhammadu Buhari earlier in the year gives AMCON sweeping powers to help it recover the debt owed by obligors.
He recalled that AMCON was created in 2010 as a result of the global economic crises of 2008/2009, which nearly crippled the Nigerian financial system, noting that the intervention at the time, depositors would have lost N3.7tr. AMCON had in the process also saved over 15,000 jobs, while purchasing approximately 12,743 bank loans through debt instruments worth N3.9tr. This was based on the simple understanding that the loans would be recovered either through voluntary payment or disposal of assets pledged by the obligors.
Also speaking at the event, AMCON Managing Director/Chief Executive, Ahmed Kuru, lamented a situation where the obligors have been working hard to stretch AMCON to the sunset period.
He however warned that the corporation, under his leadership, is determined to achieve its mandate within the limited time available (and within the law), adding that the amendment can only be as effective as the judiciary pronounces on its provisions within the interpretative powers vested by the Constitution of the Federal Republic of Nigeria 1999.
“On our part, we will continue to sensitize our external solicitors on the best approaches in presenting AMCON cases to the courts. During our recent interaction with our external solicitors, we conveyed some of our concerns and implored them to properly equip themselves with the unique provisions of the amended AMCON Act as well as the Practice Directions whenever they appear before Your Lordships. AMCON is committed to achieving its mandate within the limited time available (and within the law) and we recognize the crucial role of the judiciary in this effort.
“We have repeatedly made the point at every opportunity that all stakeholders must view the AMCON mandate as one of serious national importance. If at sunset AMCON is unable to recover the huge debt of over N5trillion, it becomes the debt of the Federal Government of Nigeria for which taxpayers’ monies will be used to settle. The implication is that the general public will be made to pay for the recklessness of only a few individuals who continue to take advantage of the loopholes in our laws to escape their moral and legal obligations to repay their debts. We should not allow a few individuals to escape with our commonwealth.
“And we want to do it within the confines of the law. As we all know, the Federal High Court is AMCON’s court of first instance. Under the new amendment, State High Courts and the High Court of the FCT have also been vested with jurisdiction to hear AMCON matters, but the powers to grant ex parte orders under section 49 and 50 of the amended AMCON Act still reside exclusively with the Federal High Court,” Kuru submitted.
He further re-echoed the fact that it was unfortunate that AMCON through the instrumentality of the courts has continued to encounter a lot of challenges, which makes recovery difficult.
In addition to that, Kuru said the obligors of AMCON are getting wiser by the day, deliberately causing orchestrated legal delays knowing that AMCON has a sunset date.
It would be recalled that the AMCON Act was first amended in 2015 to address some of the encountered challenges of the corporation at the time. When the obligors again got wiser as it were, it became necessary that the Act is amended again in 2019 with a single objective of recovering the loans bought from the banks in order to settle AMCON’s debt without recourse to taxpayer’s money.
The seminar was attended by the Acting Chief Judge of the Federal High Court, Justice John Terhemba Tsoho, officials of the National Judicial Institute (NJI), the management of AMCON and officials of Legal Academy. Balogun said the Judges of the FHC, which incidentally is AMCON’s court of first instance should as a matter of fact support the corporation to explore the bankruptcy proceedings as provided by the amendment, which he said will at least make it possible for AMCON to rubbish its debtors that are holding public office as persons of no integrity and so cannot hold such office.
Photo caption: Acting Chief Judge of the Federal High Court, Justice John Terhemba Tsoho; Director of Studies, National Judicial Institute (NJI), Mrs. Maryam Kawu; Managing Director/Chief Executive Officer, Asset Management of Nigeria (AMCON), Ahmed Kuru and Justice Abdullahi Mohammed Liman, at the seminar for Judges of the Federal High Court in Abuja…at the weekend.