Kleptomaniac politicians in the UK, Dubai and Nigeria

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A report by the Human and Environmental Development Agenda (HEDA Resource Center), a good governance advocacy group, has painted a graphical picture of the damage caused by illicit financial flows in the UK and United Arab Emirates (UAE) in the Nigerian economy. The report entitled: “Fixing Nigeria’s Illicit Financial Flows: A Critical Review of UK and UAE Policies, Laws and Practices”, was recently presented at a media roundtable in Lagos by Dr Gbenga Oduntan, Senior Lecturer in Commercial Law international at the University of Kent, UK. Deputy Political Editor RAYMOND MORDI covered the event

A new report has tied 10 former governors to properties worth £ 56million (roughly N30 billion) in the UK. Likewise, 13 senior military officers have also been linked to 216 homes in the United Arab Emirates (UAE). These are contained in a new report from Human and Environmental Development Agenda (HEDA Resource Center), a good governance advocacy group, titled “Fixing Nigeria’s Illicit Financial Flows: A critique review of UK and UAE Policies, Laws and Practices “. The report, which was recently presented at a media roundtable in Lagos by Dr Gbenga Oduntan, senior lecturer in international trade law at the University of Kent, UK, gave graphic details of the flows illicit financial institutions (FFI) from Nigeria to the United Kingdom and the United Arab Emirates or Dubai in particular.

The report gives a graphic picture of how Nigeria is caught up in a network of illicit capital flows to the UK and Dubai. For example, due to Nigeria’s colonial ties to the UK, the country is familiar ground for Nigerians. In addition, the relaxed rules on property in the country are aimed at attracting foreigners with a lot of money to spend. There are armies of lawyers and public relations firms that specialize in flushing reputations. Britain also has its own network of secret offshore territories, dubbed its “second empire” by anti-corruption activists. In short, London is ideal for money laundering.

The interaction between corrupt public officials in Nigeria and British companies operating in Nigeria has also not received the attention that is usually given to threats such as terrorist financing, drugs and human trafficking. Oduntan said there was a deliberate effort to transform the city of London into a global financial center, following the decline of the British Empire. He added, “The city holds a special place in the hearts and minds of the corrupt elite in former colonies like Nigeria. There is significant evidence that the London property market is a magnet and a safe haven for stolen wealth.

The situation in Dubai is not too different from that of the UK. For Nigeria’s corrupt political elites, Dubai, which has been dubbed the commercial capital of the Middle East, is the perfect place to hide their ill-gotten wealth, so that they can occasionally escape for a few days to enjoy their true luxury. domain worth millions of dollars. This is not only because Dubai is easily accessible, but also because it welcomes anyone with unexplained wealth. Likewise, the UK’s relaxed home ownership rules, which target foreigners with a lot of money, also make the country a haven for politically exposed people and their associates in developing countries to spend their ill-gotten money. Indeed, Dr Oduntan said the UAE and UK are two key financial jurisdictions, which offer excellent case studies for understanding Nigeria’s IFF problem.

Many important cases have been used to illustrate the damage that money laundering has done to the Nigerian economy. The case of the former Minister of Petroleum Resources, Ms. Diezani Alison-Madueke, helps illustrate how a well-oiled system of professional facilitators and an ubiquitous enabling environment on both sides encourage money laundering. As Minister in charge of the Ministry of Petroleum Resources between 2010 and 2015, Ms. Alison-Madueke also headed the Nigerian National Hydrocarbons Company (NNPC) until 2015. Some of her related assets which were seized by the EFCC include 56 luxury homes, superyachts and apartments around the world. In addition, audits of accounting firms, KPMG and PwC, reportedly revealed that $ 18 billion disappeared from the Nigerian oil fund during an 18-month window between 2012 and 2013.

The case of the 245 Oil Exploration License, also known as the Malabu Oil Deal, also illustrates how professional facilitators are helping politically exposed people easily take away the country’s stolen wealth. The anti-corruption agency is suing former Minister of Justice and Federation Attorney General Mohammed Bello Adoke on 14 counts bordering on money laundering up to $ 6 million. Adoke, who fled the country to escape trial in 2015, finally returned to Nigeria on Thursday, December 19, 2019, from Dubai, United Arab Emirates, in the pending arms of EFCC agents.

Adoke is still on trial for abuse of power and money laundering in relation to the granting of the Petroleum Exploration License (OPL) 245 to Shell and the former president of ENI Olusegun Obasanjo had revoked the license OPL 245, which the late dictator, Sani Abacha, granted Dan Etete, his then petroleum minister, and reassigned him to Shell Nigeria Exploration and Production Company. Etete’s Malabu Oil and Gas Company, however, recovered it in 2006 through court.

The report called attention to the services of facilitators to move the incredible wealth stolen by the late dictator, Sani Abacha (known as Abacha Loot) to safe havens across the world. The report states: “Billions have been transferred to the UK and from there to banks and financial institutions in France, Germany, Switzerland and the US and a few other jurisdictions. The crass rudeness of the PEP’s grand corruption in Nigeria was described by General Abacha’s son Mohammed Abacha during his questioning by British lawyers, and he gave colorful descriptions of how his family members, their bankers and the Central Bank, “ bags, cartons and trucks were used to transport money out of Nigeria and into offshore accounts.

“The involvement of local and foreign actors over the past decades has compounded the problem of IFFs in Nigeria. This international mischief requires concerted and even global attention. Effective reporting of suspicions of money laundering and other aspects of IFFs largely depends on professional intermediaries, both in the financial and non-financial sectors. The prevalence of the problem is not due to the complete lack of rules in this area, as many professions already have due diligence and reporting obligations under the EU Anti-Money Laundering Directive, law 2002 Proceeds of Crime and Criminal Finance Act in the UK, Proceeds of Crime (Money Laundering) Act in Canada and many others. “

What can be done to stem the tide of exit from Nigeria’s IFFs? Oduntan advocates for training and institutional capacity building for relevant Central Bank of Nigeria (CBN) officers. He said: “The Central Bank of Nigeria (CBN) has a special role to play, which it clearly has not played at its best. Although the CBN appears to have very good resources, its shortcomings in preventing IFFs are of great concern. This may reflect a general incapacity of African central banks. There is therefore a good basis for recommending special cooperation between the CBN, the UAE Central Bank and the Bank of England. This should involve joint training sessions focused on IFFs on their mutual legislation, regulations, statistics, banking guidelines, banking and payment systems as well as consumer protection and licensing, etc. “

It also proposes a trilateral anti-corruption working group between the United Arab Emirates, the United Kingdom and Nigeria. He said: “Such a working group will be able to serve as a clearinghouse for special projects, investigations and asset recovery operations. It is clear that the work at hand is complex, extensive, important and Herculean in nature.

Another option, he added, is to persuade the UAE, UK and other countries that are havens for the proceeds of corruption to stop receiving these illicit funds from Nigeria. His words: “One of the central tasks of the entire international community is to convince the beneficiary states of the IFF to stop channeling wealth to their shores through a combination of direct and indirect strategies, actions and inactions. It would not be an easy task for both the United Arab Emirates and the United Kingdom. “

Indeed, Nigeria is losing a bewildering amount of money due to corruption and illicit capital outflows from the country every year due to the corrupt practices of PEPs and their cronies; resources that could have been used to tackle the country’s infrastructure deficit. HEDA Resource Center Chairman Olarenwaju Suraju said the country was in a situation of powerlessness as it would require collaboration from countries where such stolen wealth is hidden to be able to stop the flow of money out of the country. Without such collaboration, he added, it will be difficult to fight corruption and stop illicit capital flows out of the country.

Oduntan said the country was losing even a larger amount of money due to corrupt practices of multinational corporations in the form of tax evasion, bogus invoicing of illicit trade and transfer pricing. In addition to the huge amount of money illegally hidden abroad by politically exposed people, he said multinational companies were robbing the country of nearly $ 15 billion a year because of tax evasion.

Oduntan said the IFF problem is a global phenomenon that particularly worsens and exhausts the economic fortunes of developing states around the world in a way that should gain the attention of legal and development scholars. For Nigeria in particular, he said the vast movement of stolen wealth from Nigeria to the United Arab Emirates and the United Kingdom, among other more developed states, is an undeniable reality of contemporary international life.

As a result, he said, Nigeria, currently, is significantly underperforming economically and scoring extremely low on development indicators. “The country has weak state institutions, clear regulatory gaps and suffers from considerable security challenges,” he added.

Don University said there was severe under-invoicing between Nigeria and the UK, and fixing Nigeria’s illicit financial flows would require destination countries to work with the country to shut down their systems against the alleged proceeds of crime. He said multinational corporation tax evasion made up about 70% of the money taken out of the country.



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