Bayelsa fraud file
December 28, 2006 | posted by Nigerian Muse (Archives)
Bayelsa gov pays N1.7bn to 7 ghost
firms, ICPC tells court
By IseOluwa Ige
Vanguard Monday, December 06, 2004
ABUJA — GOVERNOR Diepreye Alamieyeseigha of
Bayelsa State allegedly approved and paid a total N1.7 billion to seven
fictitious companies as contract sum, the Independent and Corrupt Practices
Commission, last Friday, told a Federal High Court sitting in Abuja.
The court also heard that the state Tenders
Board issued contracts to fake companies to the tune of N667, 258, 865.00 .
The Bayelsa Governor who was yet to respond to
the allegation, however, secured a legal victory on Friday in respect of the
matter as he was given a go-ahead by the court to apply for an order of
mandamus compelling ICPC to hand over to him, a report of its investigation
which allegedly indicted him.
The Independent Corrupt Practices and other
related Offences Commission (ICPC), had, about two years ago, commenced
investigations into allegation of corruption, mismanagement and abuse of
office against the governor and some Bayelsa State government officials upon
a petition forwarded to it.
The investigations were into various matters
including the contract award system, financial practices, procedures and
system of government of Bayelsa State. The commission which invited a number
of government officials during investigation indicted the governor and some
of the government officials but did not make available its report to the
state government despite its request for it.
Instead, the commission sent the report to
the Chairman of the National Judicial Council (NJC), Justice Muhammadu Lawal
Uwais, with a petition requesting that an independent panel be convoked to
investigate Governor Alamieyeseigha of corruption. The refusal of ICPC to
make available a copy of the indicting report made Bayelsa State government
approach a federal high court sitting in Abuja with a view to compelling it
to release the report.
After arguments were canvassed on behalf of
Bayelsa State Government, the presiding judge, Justice Stephen Adah, last
Friday, granted leave to the state to compel ICPC to hand over a copy of its
report to the state government. The commission’s report was written by two
of its investigators, Messrs. O.O. Kehinde and A. Abdulsalam.
Specifically, the report stated that
Alamieyeseigha approved contracts and payments of Niger Delta University to
the tune of N1.7 billion to about seven fictitious companies.
In an affidavit deposed to by one of ICPC’s
investigators, Kehinde, the names of the fictitious companies were given to
include ADM Investments Limited, Multi Web Nig. Ltd, Graceland International
Ltd., Brits Investments Ltd., Vinny Investments Ltd., Jowiz Nig. Ltd., Marsh
Nig. Ltd. and Niger Delta Wetland Centre.
According to the commission, at the time the
said contracts were awarded and paid for, none of the companies was
registered with the Corporate Affairs Commission (CAC). Besides, the
commission stated that no financial regulations were followed on the award
and mode of payment for such contracts. ICPC also stated that the Bayelsa
State Tenders Board issued contracts to fake companies to the tune of
N667,258,865. 00 .
Relying on these findings, the commission
applied to Chief Justice Muhammadu Uwais to investigate the allegations in
accordance with the ICPC Act.
But Bayelsa State’s Attorney General, Mr.
Talford Ongolo wrote a letter to the commission asking for a copy of the
report. He stated in the letter that the report would help the state to
improve its financial practices.
The commission, however, refused the request
following which Ongolo wrote another letter of demand. When it became
obvious that the commission would not release the report, the state went to
court asking for the following prayers:
— A declaration that by virtue of section 6 of
ICPC Act, the commission has a statutory duty to assist the state on ways by
which fraud or corruption might be eliminated;
— A declaration that having conducted and
concluded an elaborate investigation into the financial practices, systems
and general management of the finances of the government of Bayelsa state
consequent upon a petition alleging corrupt practices against the governor
of the state, ICPC is duty bound to make the report available to him for the
purpose of assisting him to review the financial practices of the government
in order to take appropriate steps to eliminate or minimize fraud or
— An order of mandamus compelling the commission
to make available a copy of its report.
The state claimed that ICPC was under obligation
to help it check fraud and that the report of its investigation into the
affairs of the state was necessary to help it tighten all loose ends.
The state said that it cooperated fully with the
ICPC’s investigation team and therefore, deserved to be given a copy of the
report of the investigation. The case had been adjourned to December 16 this
year for hearing. The court ordered Bayelsa to serve ICPC with all the
How They Steal Your Money
•An Idiot’s Guide
The Irrevocable Standing Payment Order (ISPO) is as good as cash – and what
a bonanza it has become. For a governor who wants to steal directly from the
state allocations, ISPO is the best instrument. It works like this: in a
fraudulent arrangement with a bank in which state allocations are lodged,
company X will be named as having just won a contract from the state
government. The bankers will be instructed to pay the company a certain
amount as soon as the state allocation draft is lodged. However, the truth
is that company X did not win any contract, and no job is going on. All that
comes from the state at the end of the month is the balance after the
deductions of the ISPOs. The deductions may go on for years, and at the end
of the “exercise,” company X will be counting billions.
Inflated Contracts a.k.a “Jerk it up”
It has been suggested that the biggest drainpipe for public funds is the
inflated contract syndrome. A contract that should cost probably N20 million
may be awarded for N100 million in order to take care of everybody’s
interest – from the head of the executive arm to the cabinet, from the party
chieftains to lawmakers in the last 10 years.
A presidency official said during the week
that over N800 billion has been lost to the “jerk it up” syndrome.
The presidency is trying to block this pipe at federal
level through the Due Process office, but the fear is that this office too
may become a drainpipe in the nearest future.
A former Northern governor, who was well-known for his flamboyance, was a
man of no little appetite. When he assumed office in 1999, he reportedly
directed parastatals and departments to make certain “returns” on a monthly
The State Primary Education Board (SPEB)
alone was making a return of N50 million monthly to him throughout his
tenure. What SPEB simply did was to “adjust” its expenditure profile in
order to satisfy the governor’s appetite.
This scenario is a familiar style in the states. The
governor gets fatter, the citizen gets thinner.
Council Allocation Magic
This is very common in the North. The councils are not allowed to allocate
contracts beyond certain sums, irrespective of what the council allocations
For instance, a governor may put a ceiling of N2 million expenditure per
month for its councils, even through each council may be entitled to N50
million from the federation account. Whatever happens to the balance in the
THE N2 TRILLION QUESTION...
Thisday Online 12.11.2004
•BAYELSA N126 billion
By John Iwori
Just as the Federal Government allocation to Bayelsa State monthly is high,
Governor Diepreye Alamieyeseigha expenditure profile has also been high as
evident in what he has already done or plans to do in the years ahead.
These days wherever and whenever Bayelsans gather in or outside Yenegoa, the
sleepy capital of Bayelsa State particularly at the end of the month when
the Federal Government releases figures of its allocation to states, it is
not uncommon that the issue that tops their discussion is how state
government spends its huge allocations.
Between May 1999 and July 2004, the Bayelsa state Government hjas received,
from federal allocations, the sum of N126 billion, beside the Internally
Generated Revenue (IGR) of the state.
This is the state where billions of naira was expended on feasibility
studies for various projects during the first term. A lot of the projects
including oil mill. refinery project etc, never saw te light of day.
No doubt, the state's monthly allocation is high, but there is a plethora of
voices on how this money is spent monthly. In fact, tongues have been
wagging on what the Alamieseigha administration has been doing with the
While some are of the view that the present administration under Chief
Diepreye Solomon Peter Alamieyeseigha has delivered on its mandate to the
electorate by initiating and implementing a number of people-oriented
programmes and policies, not a few, within and outside the state are
convinced that much of the funds acruing to the state have merely been
Gov Alamieseigha was not availbale during the week to answer THISDAY's
inquiries on the allocations to the state so far. In the same way, no
official was willing to publicly comment on the issue. However, THISDAY
checks revealed that besides the payment of salaries and other routine
obligations, the Alamieyeseigha’s government has not left anyone in doubt
that its allocations from the federation account is being spent on the
Security: Against the backdrop of insecurity and frequent youth restiveness
in the Niger Delta region where the vandalization of oil pipelines and other
installations, kidnapping of oil workers, especially expatriates was the
order of the day, the state government devoted a substantial chunk of its
federal government allocation to programmes and measures aimed at
eradicating or minimizing the increasing cases of youth restiveness and
insecurity of lives and properties in the state. The state government's
security outfit, Bayelsa Volunteers was not only established by the
Alamieyeseigha’s administration, it also equipped it with sophisticated
weapons and gadgets, patrol boats and vehicles to police the state's nooks
and crannies. The Special Adviser to the Governor on Government House
Transport, Youths and Logistics told newsmen that the Alamieyeseigha’s
administration spends not less than N40 million monthly on the Bayelsa
Volunteers. The amount which covers the payment of stipends for the upkeep
of the volunteers, has however attracted criticism from certain quarters.
According to critics, the money spent on the Bayelsa Volunteers is another
means of siphoning the state scarce resources since the outfit has no legal
backing from the legislature. arm of government.
Nevertheless, the Bayelsa State chief security officer defended the
expenditure on the Bayelsa Volunteers in his presentation of the 2005
appropriation bill estimates to the State House of Assembly. Said he: “you
will agree with me that our dear state has achieved the peace needed for
sustainable development. To strengthen security, the administration provided
support to the various security agencies and other auxiliaries security
services in the state. We have also succeeded in providing an enabling
environment for the Bayelsa Volunteers to operate in the state. I am glad to
report that this organization has complimented the efforts of other security
Roads and Infrastructure: Created October 1,
1996 by the late head of state, General Sani Abacha, Bayelsa State has only
one access by land – the Mbiama/Yenagoa road. Though it is a Federal
Government road, the Alamieyeseigha’s administration in 2002, awarded the
rehabilitation of the road to construction giant, Julius Berger Plc. Apart
from expanding it and making it a dual carriageway, the state government
also made provision for streetlight. The contract which is valued at N7.6
billion is at the verge of completion. It is expected to be commissioned in
the first quarter of 2005. 13 other link roads within the state capital,
Yenagoa, the Amassoma – Tombia road and Emeyal – Otuoke road are progressing
satisfactory, according to the governor. Already, 3 roads started by the
Alamieyeseigha’s administration has been completed and commissioned by
President Olusegun Obasanjo during his recent visit to the state.
Education: Though the state government is yet
to make public the exact amount it has so far spent on the establishment on
the state – owned Niger Delta University (NDU), Wilberforce Island,
impeachable sources said a substantial chunk of the state allocations from
the federation account has gone into making the tertiary institution meet
the required standards.
In the words of Alamieyeseigha “there is no doubt that we have achieved
tremendous progress in the area of education. The establishment of the Niger
Delta University and subsequent efforts at building it has given our teeming
youths greater opportunities for higher education.
“Besides, government has started a systematic programme in all educational
institutions. This year alone, government has carried out renovation of more
than 30 schools. Contract has also been awarded for the building of a
befitting library complex in the state capital. We are also giving deserving
attention to the proposed Federal Polytechnic in Yenagoa”.
But it is on the Niger Delta University project that the governor was
recently accused by the ICPC of awarding contract and effecting payment of
about N1.7 billion to fake companies
Transport: This is another area the
Alamieyeseigha administration is spending its Federal Government allocation.
It has procured and commissioned 24 luxurious boats for transportation in
the riverine parts of the state, besides the establishment of the Bayelsa
Transport Company (BTC). This company already has a fleet of vehicles plying
various routes within and outside the state.
According to the governor, “government has continued to provide official
vehicles to civil servants. In November 2004, all the 33 Permanent
Secretaries in the state civil service were each given a brand new Peugeot
504 Saloon car”.
Health: Governor Alamieyeseigha scored himself
high grades in the healthcare delivery in the state. According to him,
government has introduced the monthly release of funds for the systematic
upgrading of healthcare facilities in the state. Work on the 500 bed general
hospital is progressing satisfactorily.
He disclosed that N400 million has been signed to upgrade facilities at the
Okolobiri General Hospital. But the question is has the hospital really been
upgraded? And could it ever have been done with the said amount?
Housing: A number of housing projects has been
completed just as it is embarking on new ones. These include Opolo Housing
Estate for Commissioners, Special Advisers, General Managers and other top
government functionaries; an estate beside government house, Yenagoa;
completion of the new Liaison Office in Abuja; acquisition of eighteen three
bedroom apartments in Abuja to serve as transit camp for Bayelsans in the
Federal Capital Territory (FCT), Abuja; governors and deputy governors
lodges across Epie Creek in Yenagoa, as well as the preparation of over 2000
plots to civil servants to build their own houses.
Investments: One area the Alamieyeseigha’s
government has devoted a significant part of the Federal Government
allocation is the establishment of companies and acquisition of shares.
Apart from the Brass Refinery Limited in which the Bayelsa State government
has a substantial interest, the Alamieyeseigha’s administration recently
acquired 54.8% of the shares of International Trust Bank Plc. The purchase
of the bank shares cost the state government about N2 billion.
Utilities: To arrest the scarcity of potable
water in Yenagoa and its environment, Governor Alamieyeseigha disclosed that
a total of 58 rural water projects and the Yenagoa main water works have
been awarded. He did not say how many have been completed.
Bayelsa remains the only state in the federation yet to be connected to the
national grid. It depends solely on the Kolo Creek/Nun River Gas Turbine
Power Station, Imiringi in Ogbia Local Government Area to meet its energy
needs. However the machines are not only analogue but also obsolete as they
are no longer in the market anywhere in the world. To arrest the persistent
power outage from the decaying machines, the two units of the gas turbine
station were sent to the original manufacturers, Rolls Royce at Aberdeen,
Scotland for digitalization. The exercise cost the state government millions
of pounds. Already, the two digitalized gas turbine engines have been
brought back to the country and installed for improved electricity supply.
For instance, not a few have wondered why the haste to build a new
multi-billion naira governor and deputy governor lodges across Epie Creek in
Yenagoa when it was just a few months ago, the existing ones were renovated.
The renovation exercise cost the state government millions of naira. Indeed,
going by its architectural design and finishing, the current Bayelsa State
Government House, Yenagoa can compete favourably with any other one in the
It is in the same vein many view the Bayelsa Airport Project. Already, in
certain circles, it has been tagged “a needless white elephant project
designed to siphon the state scarce resources”. Mr. Ebikibina Ebiowei, a
Yenagoa resident told THISDAY that the airport project would be abandoned as
soon as the politicking for the 2007general elections gatherers momentum.
“How many Bayelsans can afford to travel by air? Already Nigeria has 19
airports. Apart from the one in Lagos, Port Harcourt, Abuja and Calabar, the
rest are barely in use. What's more, there is an air-port in Port-Harcourt,
which is just about an hour or so drive to Yenegoa, so why "waste money on
an air-port project now, when so many other biting needs are abandoned? Yet
our governor thinks what we need now is an airport,an indication that he is
not only misplacing the state's priorities, but also that he is fast
disconnecting with the people.
“The argument that he is constructing the airport because of the envisaged
influx of people to the state as a result of the gas gathering project and
the Liquefied Natural Gas (LNG) hardly appeals to anybody in Yenagoa. People
believe that if the East West road is rehabilitated, one can get to Yenagoa
from Port Harcourt international airport faster.”
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