Responses to Emerging Corruption Trends In Nigeria By Emmanuel Akomaye, MFR Economic and Financial Crimes Commission At The 5th ICAC Symposium 9

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Responses to Emerging Corruption Trends In
NigeriaByEmmanuel Akomaye, MFREconomic and
Financial Crimes CommissionAtThe 5th ICAC
Symposium 9 11 May, 2012Hong Kong
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Nigeria
POPULATION 167 million (47 of the West African
Sub-Region) GDP 7.68 (real growth rate) 2,600
(per capita)
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Introduction

• Nigerias corruption rating by Transparency
  International in the last six(6) years witnessed
  an improvement in 2008 and thereafter suffered, a
  steady decline
• Coincidentally, the last six years also witnessed
  the reinvigoration of enforcement actions by the
  various anti-corruption agencies
• The seeming contradiction can be explained within
  the context of the legacy corruption cases that
  are yet to be resolved and also fresh
  investigations that have been launched into new
  cases
• Overall, corruption remains a major governance
  challenge in an emerging economy such as Nigeria.
  Consequently, it is only with sustained
  enforcement actions and extensive governance
  reforms over time that will improve the situation

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6 years Scorecard on the Transparency
International CPI
YEAR SCORE RANK
2006 2.2 142 of 163
2007 2.2 147 of 179
2008 2.7 121 of 180
2009 2.5 130 of 180
2010 2.4 134 of 170
2011 2.4 143 of 183
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Corruption Trends

• Revenue from Hydro carbons/oil gas continue to
  provide a major opportunity for corrupt practices
  particularly in the public sector with a strong
  private sector conspiracy and facilitation
• Procurement contract abuses either through
  bribes, inflation or bid rigging using
• Outright embezzlement by senior public officials
  managing agencies or departments with huge
  revenues or budgets
• Abuses relating to the management of security
  votes
• Utilization of complex web of Special Purpose
  Vehicles (SPVs)

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Corruption Trends Contd.

• The corrupt seem to be shifting destination from
  the safe heavens in Europe to Asia and the middle
  east in hiding their proceeds of corruption
• Others choose to invest part of the proceeds of
  crime in expensive real estates domestically

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Legal Framework

• Nigerian is a signatory to the UNCAC
• UNCAC has been domesticated through the creation
  of the Independent Corrupt Practices Other
  Related Offences Commission (ICPC)Act, 2000 and
  the Economic Financial Crimes Commission (EFCC)
  Act, 2004
• There is also the Code of Conduct Bureau (CCB)
  created under the Constitution of Nigeria, 1999
  to manage declaration of assets by public
  officers
• Other complimentary anti-corruption bodies
  include the Nigerian Financial Intelligence Unit
  (NFIU) and the Bureau of Public Procurement
  (BPP), 2007

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Legal Framework Contd.

• The Nigerian Extractive Industries Transparency
  Initiative (NEITI) Act, 2007
• Nigeria is also signatory to the African Union
  (AU) Convention against corruption and the
  Economic Community of West African States
  (ECOWAS) Protocol on Good Governance
• The above anti-corruption laws/instruments are
  collaboratively enforced by the national
  anti-corruption authorities

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Responses to Corruption Trends in Nigeria

• Further to the provisions of UNCAC and other
  international instruments, Nigeria has responded
  by
• Criminalizing corruption/Money laundering
• Embarking on sustained investigation and
  prosecution of offenders particularly PEPs
• Tracing and recovering tainted assets and
• Institution of prevention measures through wide
  institutional reforms
• Approaching the anti corruption fight as part of
  its national economic and political reforms
  strategy-the transformational agenda
• Ongoing effort to strengthen existing legislation

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Responses Contd.

• Investigation/Prosecution/Asset Recovery
• DSP Alameyesiegha Case - Involved in looting of
  the Bayelsa State treasury and money laundering
  in the UK. Successfully investigated by the EFCC
  in collaboration with the MET Police, tried,
  convicted and sentenced. Assets of over USD40
  Million recovered domestically and
  internationally
• Tafa Baloguns Case- Looting of public treasury
  and money laundering. Investigated/Prosecuted and
  sentenced in Nigeria. Assets of over USD5
  Million recovered domestically.
• Prosecution of illegal oil bunkerers in the Niger
  Delta region and the confiscation and recovery of
  several vessels worth millions of Dollars

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Responses Contd.

• The Value of International cooperation in
  fighting corruption
• The Raj Bhojwani Case (Part of Abacha
  loot)-Nigeria and Jersey collaborated effectively
  to investigate, prosecute and sentence Mr.
  Bhojwani for money laundering offences arising
  from corruption using SPVs. Approximately USD40
  Million recovered and returned to Nigeria through
  a sharing arrangement
• The Alamieyeseigha case. The EFCC and the MET
  Police collaborated in the investigation leading
  to his sentence in Nigeria and the recovery of
  over 40 million from assets in UK, South
  Africa and Nigeria etc
• The Ibori Case. Sentenced in April 2012 to 7
  years imprisonment by a London court for money
  laundering. Confiscation of assets worth over 35
  million in progress

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Responses Contd.

• Settlements/Deferred/Non Prosecution Agreements
• Nigeria has also adopted the settlement strategy
  to bring to closure some of the major corruption
  cases involving foreign multinational companies.
• The TSKJ USD180 Million bribery scandal
  involving the USD6 billion Nigerian Liquefied
  Natural Gas (NLNG) Project in Bonny
• A total of USD157,000,000 was recovered
  from the consortium and a local conspirator
  through settlement
• Siemens telecoms fraud- Euros 34,000,000
  recovered through settlement
• Bribery of foreign public officials by
  multinationals relating to Temporary Import
  Permits (TIPs) -Shell, Transocean, and Noble
  Drilling. Over USD20,400,000 recovered through
  settlement/DPA/NPA

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Responses Contd.

• The driving philosophy for all these settlements
  has been in keeping with public policy and public
  interest considerations to save time and cost of
  litigation and effectively combating and
  deterring crime and making substantial recoveries
  of the proceeds of crime in the quickest and most
  efficient manner
• It must be noted that while Nigeria was the
  country harmed by these bribery scandals, it was
  not involved in the settlement processes that
  occurred in other jurisdictions that were
  enforcing anti-bribery laws in those other
  countries

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Preventive Measures

• Enhanced enforcement actions against PEPs in
  particular is serving as a preventive tool,
  reminding senior public officials that nobody is
  above the law
• Enforcement actions has also ramped up public
  awareness which has triggered a flurry of
  whistle-blowing on corrupt practices particularly
  by civil societies
• The institution of due process by the Bureau of
  Public Procurement has also helped reduce
  contract frauds and bid rigging
• The enactment of the freedom of Information Act,
  2011 empowering civil society as an effective
  anticorruption watchdog
• The establishment of a Transaction Clearing
  Platform (TCP)by the EFCC has equally helped
  prospective foreign investors from falling into
  fraudulent business proposals and demand for
  facilitation payments which are unknown to
  Nigerian law

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Challenges

• The bulk of evidence in foreign bribery cases is
  not locally available. Most of the negotiation
  and payments were made abroad and many
  jurisdictions are not disposed to sharing such
  evidence even on intelligence basis. Those that
  are disposed, insist that the normal MLAT process
  must be followed
• The slow justice system is a major challenge
  making prosecution of corruption cases windy and
  frustrating
• The legal framework today recognizes only
  conviction based system making asset recovery a
  difficult task.

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Challenges Contd.

• Safe financial heavens abroad have also made the
  problem of fighting corruption challenging for
  law enforcement Agencies in victim States.
  Proceeds of crime stashed in foreign Banks are
  never spontaneously reported until a criminal
  investigation is launched at which time a lot of
  the proceeds have been dissipated or layered and
  moved to yet other jurisdictions making tracing
  even more difficult
• The 2010 Global Witness Report chronicled how
  British Banks HSBC, RBS, NATWEST and USB
  facilitate corruption and money laundering in
  Nigeria and Equatorial Guinea.
• Victim States including Nigeria are not involved
  in the settlement of foreign bribery cases and
  there is emerging discourse that seem to confuse
  who the real victim is in a bribery case and the
  principle of direct proximate harm

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Challenges Contd.

• The drive for revenue by countries enforcing anti
  bribery laws on the supply side seem to be
  gradually whittling down the real value of
  international cooperation with countries on the
  demand side where transactions for these bribes
  took place
• There is equally emerging the argument on double
  jeopardy canvassed by multinational companies who
  consider the payment of fines/compensation in
  several jurisdictions as double punishment.

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Moving Forward

• Sustaining the investigation and prosecution of
  corrupt officials and their collaborators in the
  private sector
• Combine the settlement and the criminal
  conviction option to recover assets
• Push for the passage of a non-conviction based
  legislation to compliment the conviction based
  system
• Collaborate with countries whose multinationals
  are involved in bribery of Nigerian public
  officials to bring them to justice in accordance
  with the spirit of UNCAC.
• Ensure the enforcement of transparency codes by
  Multinationals

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Conclusion

• The supply and demand sides are still largely
  working in silos and even in cases where they
  collaborate, there is mutual suspicion which
  prevent the exchange of vital information. This
  is a negation of the spirit of UNCAC. The gap
  must be closed if the global fight against
  corruption must succeed.
• THANK YOU

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Conclusion
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Contact

• ECONOMIC AND FINANCIAL CRIMES COMMISSION
• No. 5 Fomela Street,
• off Ademola Adetokunbo Crescent
• Wuse II, Abuja
• Tel/Fax [phone]
• Email eakomaye_at_efccnigeria.org
• Website www.efccnigeria.org