Examining Suru Worldwide, AMCON’s Tug-of-War
Dike Onwuamaeze writes on the ongoing dispute between the Suru Worldwide Venture Nigeria Limited and the Asset Management Corporation of Nigeria
A game of intrigues! This is the apt description of the goings on between the Suru Worldwide Venture Nigeria Limited and the Asset Management Corporation of Nigeria (AMCON) over a loan Suru borrowed from the defunct Oceanic Bank in 2007.
The loan was later sold to the AMCON in 2010 by the Managing Director of Oceanic Bank, Mr. John Aboh, even though it was alleged to be a performing loan.
The matter has been argued in multiple numbers of courts since 2010- from two Federal High Courts to the Appeal Courts. Currently, two appeals on this matter are pending before the Supreme Court. One of them would come up in the apex court on September 23, 2022.
The legal tussles between Suru and the AMCON had their origin in 2007, when Suru obtained a loan of N13.3 billion from the Oceanic Bank under the stewardship of Mrs. Cecelia Ibru, former managing director of the bank.
Initially the relationship between the lender and the borrower was warm and friendly. But this took a different turn in 2009 when a new Governor of the Central Bank of Nigeria (CBN), Mr. Lamido Sanusi (now dethroned Emir of Kano), intervened in the operations of the Oceanic Bank, sacked Ibru and appointed Aboh as its new managing director.
The Group Managing Director of Suru Group Limited, Mr. Edward Akinlade, said, “early in 2007, Suru took a loan of N13.5 billion from the defunct Oceanic Bank under Dr. Cecilia Ibru, to buy over 25 acres of land in the GRA, Ikeja, Lagos State, and to build one hotel in Allen Avenue, Ikeja, called Best Western.
“The loan was basically doing well until 2010 when we got a letter that it has been sold to AMCON, which is not supposed to buy a performing loan. What then happened was that Aboh, in order to collect money from AMCON, sold all the loans to AMCON irrespective of whether they were performing or not. Another thing Aboh did at that time was that he took all our credits.”
However, in its response, AMCON argued that all the facts being peddled by Suru Worldwide Ventures Nigeria Limited and its promoters are false and intended to mislead the public.
Akinlade alleged that the Suru has drawn N10 billion before the loan was sold to AMCON, leaving N3.5 billion to be drawn. But to his chagrin, the group received letters two months after its loan was sold. One of the letters was from the AMCON, which, “wrote us that they have bought our loan.” Another letter also came from the Oceanic Bank said that “our loan has been cancelled because they do not have money due to the CBN’s intervention in their operation.”
Akinlade had a meeting with the first Managing Director of AMCON, Mr. Mustapha Chike Obi, to make it clear that AMCON could not buy the loan. Chike Obi told him that Suru’s loan was bought from Oceanic Bank at N8.3 billion. Akinlade alleged that Oceanic Bank hyped the loan balance to N15 billion.
The Intrigue
He alleged that Chike Obi asked him to pay some amount so that AMCON would release N3.5 billion to Suru to complete its unused credit.
“I was excited, and in my foolishness sold eight of our beautiful acres in the GRA to Multichoice and sent N2.2 billion to AMCON leaving a balance of N6.3 billion. From 2013 to 2015, AMCON was not picking my calls and any attempt to see its managing director was unsuccessful,” he alleged.
The matter, according to Akinlade, became complicated when Mr. Ahmed Kuru became the managing director of AMCON. He alleged that Kuru took the matter very personal and refused to release the N3.5 billion unused credit. Rather, Kuru told Suru to pay N2.3 billion to AMCON.
Akinlade quickly made contact with First Bank, London, and raised $50 million. “I came back to Lagos and went to AMCON and said ‘here is your money.’ But AMCON rang First Bank, London, to remind it that there is a rule in Nigeria that anyone owing AMCON should not get a loan from Nigerian bank. The London bank rang me and announced that my loan has been cancelled,” he alleged.
Litigations
The next thing AMCON did was to sue Suru before Justice J. Idris seeking a declaration that it has purchased loan within the law. That case was dismissed by Justice Idris and AMCON never appealed against the judgment.
Then Suru Group sued Oceanic Bank (now Ecobank) for N39 billion for selling its loan to AMCON illegally before Justice M. S. Hassan of the Federal High Court. Within one month of that case, AMCON came to be joined and counter sued Suru for N27 billion.
The case before Justice Hassan was still pending when AMCON went to another court to sue the inspector general to help them take possession of Best Western Hotel without naming or joining Suru as a party to the case. AMCON got a favourable judgment which Suru appealed against.
“We appealed against that judgment on the ground that our name was not included. The Court of Appeal set aside the original ruling stating that AMCON should go back to the Federal High Court to originate a new case with our name. AMCON appealed to the Supreme Court and the case will come up on September 23.
Justice Hassan delivered a judgment that dismissed AMCON’s case against Suru. Justice Hassan ruled on March 22, 2018, that the AMCON’s “claims have been dismissed. It goes without saying that the application for injunction dated 25/5/2017 but fled on 23/5/2017 is dismissed. It is common saying that you cannot put something on nothing and expect it to stay. It will definitely collapse. That is my considered ruling.”
AMCON appealed the judgment delivered by Justice Hassan at the Court of Appeal, Lagos Judicial Division, before Honourable Justices Biobele Abraham Georgewill, Frederick Oziakpono Oho and Folasade Ayodeji Ojo, and lost the appeal.
In a lead judgment on April 19, 2021, that was written by Justice Oho, the Court of Appeal affirmed the judgment as delivered by Hassan and declared AMCON’s appeal moribund. Oho said: “There is no gain saying the fact that this appeal is moribund and completely lacking in merit. It is accordingly dismissed and the decision of the FHC, Lagos Division, delivered on May 22, 2018 Coram: M.S. Hassan J in Suit No. FHC/L/CS/450/2011 wherein the court dismissed the appellant counter claim dated June 16, 2016 and the appellant motion on notice dated May 22, 2017, seeking injunctive orders to restrain 1st, 2nd Respondents from dealing with properties which are the res of the suit at the lower court during the pendency of the suit is affirmed.”
AMCON’s Position
However, described Suru as a recalcitrant debtor whose activities, if not tamed, were capable of completely destroying the financial services in Nigeria.
“It is pertinent to state that, by the provision of Section 5 of the Asset Management Corporation of Nigeria Act, 2010 (as amended), AMCON is empowered to acquire Non-Performing Loans of financial institutions. Indeed, the outstanding indebtedness of Suru to Ecobank, at the time, came within the ambit of non-performing loan, which AMCON was mandated and entitled to acquire, in law.
“It will be recalled that, the creation of AMCON became expedient about a decade ago when financial institutions in Nigeria, especially commercial banks, became very burdened by debts of some customers like Suru who believed that bank loans were simply their share of the national cake and not to be repaid.
“Contrary to the fallacy contained in Suru’s publication, AMCON does not stand the chance to reap any benefit from hunting down any business in Nigeria. In fact, AMCON has, through its appointed Receiver/Managers, successfully managed and resuscitated several moribund companies with the aim of recovering its debts from the said companies. Some of these companies are spread across the oil and gas sector, steel sector, aviation sector, to mention a few.
“It is, therefore, untrue to allege that AMCON is interested in a “pull him down syndrome.” AMCON took over all of Suru’s assets, which were pledged as security for Suru’s indebtedness, which stood at a whooping sum of N24,237,390,635.67 as at 14th of January, 2016. This fact has never been denied by Suru.
“Rather, Suru has variously acknowledged and admitted its indebtedness to AMCON. The taking over of Suru’s pledged assets is not a matter of witch-hunt, but an exercise, which was sanctioned by court orders,” the Corporation stated.
Shedding more light on the matter, AMCON in a statement explained: “In the first place, taking over pledged assets is the last option when it becomes so clear that the obligors are not willing to pay even when they have capacity to do so. In many instances when AMCON takes over assets of debtors, the debtors approach AMCON for reconciliation and restructuring.
“In Suru’s case, despite acceding to its several restructuring requests, it has persistently failed to honour any of its obligations to AMCON. All that Suru wants is for AMCON to treat it like a special debtor and ask it to “go and sin no more” despite the huge indebtedness of over N24,237,390,635.67. AMCON, as an institution created by law, will not allow any obligor to “go and sin no more.”
“Suru’s claim of running down its business is another puerile attempt to gain underserved public sympathy while failing to honour simple business agreements. Since Suru has subscribed to the enterprise of purveying falsehood to the public, we think that Suru owes the public a duty to show them proofs of how it has repaid its humongous indebtedness to AMCON.
“Suru has continued to write petitions to several public institutions in Nigeria to prevail on AMCON to release its assets to it without paying a dime. All these petitions have been dismissed as lacking in merit. Most of these public institutions recognise the fact that, debtors like Suru are responsible for the dwindling growth of the financial services in Nigeria and have made it very unattractive for foreign investors.
“However, the era of “borrow and not-pay” in Nigeria has gone for good. How can we progress as a nation when we have huge budget deficits every year while over N4trillion is in the hands of few Nigerians?” it added.
AMCON alleged that, “Suru, in its usual characteristics, has tried to lie to the public by alleging that AMCON failed to appear before the House Committee on Public Petitions. It is true that AMCON was invited to appear before the Committee on the 21st of October 2020. However, the hijacked #Endsars protest prevented AMCON’s officials handling Suru’s account to fly from Lagos to Abuja. Nevertheless, the Corporation has responded to the petition and filed a formal written response before the Committee.
“We advise the public to disregard all the attempts of Suru to misrepresent facts of its N24,237,390,635.67 indebtedness to them. Obligors like Chief Akinlade who have brazenly decided to appropriate our commonwealth to fund their expensive lifestyles while the majority of Nigerians are living below the poverty level should not walk freely around just as we must not allow them to curry public sympathy from the backdoor.”
For now, only time will tell in whose favour the justice will fall on.
