The Nigerian government has initiated legal proceedings to invalidate promissory notes issued to consultants involved in the Paris Club refund, marking a significant development in a contentious financial matter.
The suit, identified as FHC/ABJ/CS/896/2023, was filed by the federal government, along with key officials including the Attorney-General of the Federation, the Minister of Finance, Budget and National Planning, and the Accountant-General of the Federation.
The defendants in this legal dispute include FSDH Merchant Bank Limited, Ned Munir Nwoko, Gregory Nangor Lar, Riok Nigeria Limited, Prince Orji Nwafor Orizu, Olaitan Bello, Dr. Ted Iseghohi Edwards, and Panic Alert Security System Limited.
The controversy centres around the payment of $418 million to the consultants, who were engaged by the Nigeria Governors’ Forum (NGF) and the Association of Local Governments of Nigeria (ALGON). This contentious issue has strained relations among the three tiers of government in Nigeria.
In September 2021, the Debt Management Office (DMO) issued 62 promissory notes worth $418,953,668 to the defendants in response to various judgments and orders of mandamus obtained by them.
The plaintiffs assert that the promissory notes are invalid, contending that they were wrongfully issued in violation of relevant laws. They argue that the notes, although executed by the former Minister of Finance, Budget and National Planning and the Director-General of the DMO, lack the required signatures.
In support of their claims, Oyinlade Koleosho, a principal state counsel in the federal ministry of justice, argued that the promissory notes were erroneously charged against the assets of the federation rather than the assets and revenues of the states and local governments responsible for the applicable loans and debts. He cited sections 314 and 317 of the constitution, which clearly delineate the assets of states and local governments from those of the federation.
Furthermore, the plaintiffs contend that there is no valid consideration for the issuance of the promissory notes to the defendants, as they were not engaged by the federal government.
According to court documents, the defendants received various quantities of promissory notes with corresponding values:
- FSDH Merchant Bank Limited: 10 promissory notes totaling $67,925,661.00.
- Gregory Nangor Lar (Nwoko’s agent): 2 promissory notes amounting to $732,511.00.
- Riok Nigeria Limited: 10 promissory notes valued at $142,028,941.00.
- Orji Nwafor Orizu: 10 promissory notes valued at $1,219,440.00.
- Olaitan Bello: 8 promissory notes valued at $215,195.00.
- Dr. Ted Iseghohi Edwards: 10 promissory notes amounting to $159,000,000.00.
- Panic Alert Security System Limited: 10 promissory notes totaling $47,831,920.00.