Graft Investigation on Leading Industrialists
As the news about the storming of the Dangote Industries Limited by the operatives of the EFCC spread across the country and beyond, stakeholders and economic experts have called for caution to avoid harming investment inflow into the country, Dike Onwuamaeze writes
A windy storm blew across the country’s organised private sector in the first week of January 2024. The storm, which was stirred by the Economic and Financial Crime Commission’s (EFCC) investigations of more than 51 private enterprises, rattled some notable industrial organisations and top banking institutions as it appeared to spare no sacred cows and touched the untouchables.
The investigation is on the allocation of foreign exchange to private enterprises in the past 10 years by the Central Bank of Nigeria (CBN), mainly during the tenure of the embattled immediate past Governor of CBN, Mr. Godwin Emefiele.
It all began with the visit of EFCC’s operatives to the head of office of the Dangote Industries Limited in Lagos on January 4, 2024. The visit lacked the cordial compliments that Nigerians are wont to give one another during the New Year period. Rather, the EFCC was at the Dangote’s head office to search and cease some documents it claimed the industrial giant failed to make available in furtherance of its investigation on the activities of the apex bank.
However, the management of the Dangote Group, in a widely published statement, insisted that the visit was unnecessary because it has already provided the requested information to the anti-graft organisations and is cooperating with the anti-graft agency on the matter at hand.
The statement reads: “Following the widely reported recent visit of the officials of the EFCC to our headquarters in Lagos on January 4, 2024, we understand the concern and interest this has generated among our valued partners, stakeholders, and the public, and consider it necessary to provide a factual account of the events.
“On December 6, 2023, we received a letter requesting for details of all the foreign exchange allocated to our company by the CBN from 2014 to the present. We understand similar letters were sent to 51 other groups of companies requesting for same information spanning same period.
“We responded to the EFCC to acknowledge receipt of the letter whilst seeking clarification on the subsidiaries or companies within the group that they required information on. We also requested for additional time to compile and properly present the extensive documentation spanning ten years.
“However, the EFCC did not provide the clarification sought and also did not honour our request for an extension and insisted on receiving the complete set of documents within the limited timeframe. Despite this constraint, we assured the EFCC of our commitment to providing the information and pledged to share documents in batches as we complete the compilation.
“On January 4, 2024, our team delivered the first batch of documents to the EFCC. However, officers of the EFCC did not accept the documents, insisting on visiting our offices to collect the same set of documents directly.
“Whilst our representatives were still at the EFCC’s office to deliver the documents, a team of their officers proceeded to visit our offices to demand for the same documents in a manner that appeared designed to cause us unwarranted embarrassment. Worthy of note is the fact that the officials did not take any documents or files from our head office during their visit as these were already in their office.
“We must emphasise that, to our knowledge, no accusations of wrongdoing have been made against any company within our group. At present, we are only responding to a request for information to assist the EFCC with their ongoing investigation.
“As a law-abiding and ethical corporate citizen, we remain committed to providing the EFCC with all necessary information and cooperation. We have already delivered the first batch of documents and are actively working to compile and submit the remaining documents, in good time, to aid their investigation.
“Our group is a key contributor to the national GDP, the largest employer in the private sector, one of the largest groups listed on the Nigerian Exchange and one of the highest taxpayers in the country. We remain steadfast in our belief in Nigeria’s commitment to the rule of law and its dedication to fostering an environment conducive for investment and value creation for both local and foreign investors.
“We, therefore, call for the understanding and patience of our stakeholders. We will keep our stakeholders informed of any further developments.”
Another industrial giant, the BUA Group, has also issued a statement that clarified that the EFCC never knocked at its doors concerning the alleged investigation. It said: “BUA wishes to clarify that its premises were not visited by EFCC today, Thursday, January 4, 2024, neither was it raided, as has been alleged in some online publications and being shared via WhatsApp broadcasts.”
Nevertheless, the Manufacturers Association of Nigeria (MAN) is not in any way amused about the raid of the Dangote Group’s headquarters and the manner it was carried out, which it has described as a Gestapo styled invasion that is bereft of civility.
A statement that was issued on January 8 by the Director General of MAN, Mr. Segun Ajayi-Kadir, condemned the manner the visit was carried out and called for civility in operations of government agencies.
Ajayi-Kadir said: “We received the news of the invasion of the Dangote Industries Limited (DIL) by dozens of EFCC operatives with great shock.
“We also understand that about 50 other companies are also been investigated, probably with a likelihood of receiving the same ill treatment.
“Not that any company is above investigation, but it is about the appropriateness of the method and the sheer brigandage we saw on display. It is whether it will take an armed invasion by dozens of security operatives to get documents from a well-structured and clearly identifiable company like DIL.
“What we understand is that it is part of EFCC’s ongoing investigation into forex allocations in the country. We believe it is within the remit of EFCC to do so. But the question is: what is the wisdom in security operatives swooping on the headquarters of a leading African conglomerates only to demand for documents relating to allocation of foreign exchange to the group in the past 10 years?
“Is it that the company refused to respond to a request to present those documents? Are those documents only available with DIL and not in the CBN or the relevant commercial banks? Was there a possibility of armed resistance, if the EFCC operatives had come unarmed and devoid of the Gestapo style invasion?
“Why hurt the corporate image and disrupt the business operations of the company?
“The fact that the administration is currently actively engaged in activities aimed at attracting foreign investors should dictate a more circumspect and civil way to make enquiries and secure documents from existing/domestic operators.
“There is no doubt that this news has gone around the world and many, including would be investors, would be taken aback and anxiously awaiting how the story will end. This may not be the best way to show that Nigeria is committed to good corporate governance.”
The director general of MAN stated unequivocally that because of the status of DIL within the Nigerian economy, Africa and the world, “the outcome of this rather unfortunate incident may have great impact on how we are perceived as respecters of the right of business entities.
“Government agencies should exercise restraints and be mindful of the wider implications of their actions on our fragile business environment. I think it is important for the EFCC to take steps to clear the air on the negative interpretation being adduced to this action. This is necessary to reassure existing business concerns and encourage would be investors.”
Speaking in the same vein, the Founder of the Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, noted that the dramatisation of investigations by security agencies is a major worry to investors in the country. “It has grave implications for the reputation of corporate organisations. It also comes with an erosion of brand equity of affected corporates,” Yusuf said.
He added that the media shows by security agencies also create serious perception problems for investors.
“We need all the investments we can get at this time. We need to create jobs, diversify the economy, accelerate import substitution to reduce import dependence and boost tax revenues.
“Private investments are critical to the realisation of these developmental outcomes. Meanwhile, investors are already grappling with multiple headwinds- macroeconomic, regulatory, security and structural.
“The style of dramatising investigative activities has been a major embarrassment to corporate organisations. We believe quality investigations could still be done without the typical media sensations that come with such actions.
“This is not to detract from the obligations of corporate organisations to ensure compliance with regulations and other statutory requirements. This is also without prejudice to the mandates of security agencies to ensure compliance by businesses with the law.
“The point here is that investigations should be more professional, discreet and outside public glare. Extending due respect and courtesy to entities being investigated would not compromise the quality of investigative outcomes,” Yusuf stated.
The Chief Executive Officer of BIC Consultancy Limited, Dr. Boniface Chizea, questioned the motive behind the crackdown on certain businesses even though he told THISDAY that all Nigerians must welcome the recent storm against those caught in corrupt practices.
Chizea said: “But what one is worried about is the motivation for such pursuits. If they are driven by political considerations as has been speculated, there is therefore the need to be wary. And most of the businesses currently embroiled in this drive are those that contribute substantially to the fortunes of the country particularly from the perspectives of the provisions of employment opportunities and also overall contributions to the country’s Gross Domestic Product (GDP). You do not in any case want to throw out the baby with the bath water.”
He added: “It is also possible to do whatever we want to do in terms of arresting those entangled without the current drama which makes it look as if we have opted for primitive Gestapo style!
“We must observe once again that what is taking place now is in the overall interest of the country. But we must as a nation carefully examine our motives to ensure that they are genuine otherwise we shall be doing incalculable damage to the development aspirations of the country.
“It is stating the obvious to observe that corruption has been an albatross that has held the Nigerian economy down denying it of its advertised potentials.”
The Chairman of the House of Representatives Committee on Water Resources, Hon. Sada Soli, in a recent statement that was reported by Premium Times, has condemned the raid of the headquarters of the Dangote Group by the EFCC and warned that “the impression should not be given that the government is trying to attack northern interests by subjecting the richest northerner, Nigerian and African, with the largest conglomerate in the region, to unnecessary harassment.”
Soli observed that such a move against the Dangote Group poses a “threat to foreign and domestic investment” and asked President Bola Ahmed Tinubu to stop the harassment.
He said: “There is the added concern that some fifty other companies, some of them the biggest private businesses in the country, including BUA Group and Flour Mills, TGI and Wale Tinubu’s Oando PLC, among sundry others, all of whom have denied wrongdoing, are being probed for details of the forex allocations to them between 2014 and June 2023 following the report of the Special Investigator on the CBN and Related Entities, Jim Obazee,” he said.
“While there is no denying the fact that the anti-graft agency is within its rights to undertake such a probe, or that it has done a very good job of ridding the nation of economic saboteurs in the past, it is nonetheless necessary to point out that the way the agency had gone about this probe, by storming offices and making a spectacle of itself in the public space, is both counter-productive and capable of sending the wrong signals. It must resist the temptation of acting on the impulse of some influential people in government with dubious agendas.
“It is certainly not the proper way to handle matters at a time when Nigeria is going through one of its worst economic crises in history with inflation going through the roof, rising foreign investment outflows from Nigerian stocks, and the lowest foreign direct investment in our economy since the National Bureau of Statistics (NBS) started collating the data in 2013,” he said.
