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ASSET MANAGEMENT COMPANY OF NIGERIA (AMCON) ; Destructive Deviations From Mandate And The Impact On Energy Sector Companies. 

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​INTRODUCTION

Even a casual investigation into the activities of AMCON shows worrisome deviations from mission and mandate as defined in the AMCON Act 2010. The shady activities that force these deviations from mandate constitute a major obstacle to the much desired economic transformation of Nigeria. 

AMCON EXECUTIVES WHO ARE EX-BANKERS

The practice of leaving the management of a major government agency like AMCON to former bankers whose track records in banking leave much to be desired continues to impact negatively on the Nigerian economy. What is happening in AMCON today is nothing less than the perpetuation of the same culture of sharp practices which these personalities practiced when they were in banking. 

Mr. Ahmed Kuru: 

Take the case of Ahmed kuru, now MD/CEO of AMCON.  Prior to his appointment, Mr. Kuru served as MD/CEO of the erstwhile Enterprise Bank Limited, one of the bridge banks established by the Central Bank of Nigeria, from 2011 to 2014. Due to complications in how he carried out his initiative to restore stakeholders’ confidence in the bank, profitability was a big problem which thereby forced the purchase of the bank by Heritage Bank in 2014. His extensive experience in banking and financial services garnered over 35 years only finds expression in questionable practices. His work has earned him recognition in the financial sector as an astute banker when it comes to lining his pocket. Quite alright he played a strategic role in the highly successful merger of Habib Bank and Platinum Bank to form one of Nigeria’s vibrant banking brands known as Bank PHB but his inability or unwillingness to nurture this milestone led to its acquisition by AMCON which it then proceeded to arbitrarily rename as Keystone bank. Mr. Ahmed Kuru was also the Executive Vice Chairman of Emeritus Capital Limited, a financial services firm, with specialty in international business development focusing on sub-Saharan Africa where he also did not fail to practice his business philosophy of to the detriment of the financial system and economic development.
Mr. Kola Ayeye: 

Mr. Kola Ayeye is another AMCON boss with a questionable past as a banker and civil servant. He is now one of the 3 Executive Directors of AMCON with about thirty years’ experience in Financial Services, Audit and Advisory Services. But even with this background, he dropped out as the member of the start-up/turnaround teams of two banks which seems to indicate that he is not interested in ‘start-up and turnaround’ of anything. Mr. Ayeye was appointed to the Board of Mainstreet Bank in August 2011 as an Executive Director by the Central Bank of Nigeria. Mainstreet Bank was one of the bridge banks created by the Central Bank of Nigeria consequent to solvency and liquidity problems. The mandate to turn the bank around preparatory to sale was not successfully accomplished and the bank had to be sold in Dec 2014.
Kola Ayeye was the leader of the team that was supposed to carry out a due-diligence check and prepare a turnaround plan for National Bank of Nigeria. National Bank, the first indigenous Nigerian bank, became distressed in 1990. But he resigned in the course of the merger of the bank with two other banks as part of the consolidation of the Nigerian banking industry. Mr. Ayeye therefore has a questionable approach to economic development and seems to perceive his role at AMCON as an opportunity to contribute activities that are not in the best interests of employment creation and economic growth. 

Eberechukwu Uneze

Mr. Eberechukwu Uneze was previously Executive Director of the Centre for the Study of the Economies of Africa (CSEA) and Head of the Centre’s Public Financial Management & Governance (PFMG) research area. Dr. Uneze’s previously worked in the Nigerian banking sector in various roles which on closer examination indicate an approach to banking and asset management that is similar to those cite above. 
Mr. Aminu Ismail
Prior to his current assignment, he was one of the Directors appointed at Enterprise Bank Limited, after the Central Bank of Nigeria intervention, with strategic responsibility for Service & Corporate Banks. Prior to this he worked in the United Bank for Africa Plc (UBA) as Regional Bank Head, with full responsibility for all activities covering the North West zone.Mr. Ismail started his banking career 1992 and began similar questionable practices at Pannell Ker Foster (PKF) an Accounting firm and Credit Lyonnais Nigeria Limited where he rose to become Branch Manager of the company in Abuja. 
AMCON has indeed deviated from mission and mandate and that statement is strongly backed by a look at the track records of the personalities managing this sensitive financial institution. That is why there are today many entities in the energy and other sectors that have suffered from the crude financial practices of AMCON which on closer examination, are designed for self enrichment and therefore deviate from the anti-corruption mantra which the current government has been chanting. 

LIST OF COMPANIES IN THE ENERGY SECTOR THAT HAVE BEEN UNFAIRLY LIQUIDATED AND SOLD AS SCRAP BY AMCON

Global Fleet Oil & Gas Limited

National Oil
Under the current management of AMCON, it is obvious that an intense review of Section 30 of the AMCON Act 2010 is urgent and necessary to prevent the intrusions of corruption and high wire politicking. 

This section provides:
“The Corporation may acquire an interest in an eligible bank asset or an eligible financial institution if the Corporation considers it necessary or desirable to do so and shall acquire any eligible bank asset if so requested by the Nigerian Deposit Insurance Corporation acting in consultation with the Central Bank of Nigeria in pursuance of Section 38(2) of the Nigerian Deposit Insurance Act.”
The question becomes what the determining factor / considerations would be before the Corporation can “consider it necessary or desirable to do so”. One therefore wonders what role high-wire politicking will play or not play in the choice of eligible bank assets to purchase since it seems to be absolutely discretionary with no particular requirements. It is clear that the management of AMCON as presently constituted has not been totally judicious in their manner of exercising their discretions. Their choice of eligible bank assets to purchase have been driven by many practices that deviate from the professionalism, fairness, excellence, integrity and other core values which the law commands the Corporation to uphold in all its dealings with banks, the private sector and Nigerians in general.

Against this background, we can then appreciate the toll which AMCON has taken on the above listed companies in the Energy Sector.

Global Fleet Oil & Gas

AMCON took over the assets of this player in Energy Sector as held in Abuja, Lagos, Dubai and London. The bank accounts of Global Fleet Oil & Gas were also frozen as maintained with First Bank Plc, Guaranty Trust Bank Plc, Diamond Bank Plc, United Bank of Africa Plc, Access Bank Plc, Citibank Nigeria Limited and Sterling Bank Plc. The rest include Ecobank Nigeria Plc, Fidelity Bank Plc, First City Monument Bank Plc, Heritage Bank Limited, Keystone Bank Limited, Skye Bank Plc, Stanbic IBTC Bank Plc, Sterling Bank Plc, Zenith Bank Plc, Union Bank of Nigeria Plc and Unity Bank Plc. Global Fleet Oil & Gas Limited was said to be owing AMCON over N50 billion, which became the subject of protracted negotiations and court battles. However, it appears that due process was not allowed to run its lawful course before AMCON abruptly amplified debt recovery functions that took over the assets of Global Fleet Oil & Gas. AMCON just forced again with firmer negotiation strategies that did not totally follow the special enforcement powers conferred by the AMCON Act to compel some of its debtors to repay their debts.
National Oil

In the case of National Oil, there are also many questions as to how AMCON exercised the possessor order which it received from the Judiciary.
NEGATIVE EFFECTS ON THE ECONOMY

The effects which the above practices have had on the Nigeria economy are no different from the effects of corruption on a society. Corruption harms societies, undermines economic development and threatens democracy. Consequently, the activities of ANCOM under the presently constituted management harms the private sector, kills small businesses and discourages entrepreneurial initiative which are all key ingredients for economic growth. Buying up non performing loans does not give AMCON the license to strong arm the affected companies into liquidation. That was not the idea behind granting AMCON the powers to buy up non performing loans so this government agency is therefore deviating from the idea of ‘Partnerships for Development’ as listed among the seventeen Sustainable Development Goals (SDGs) which in turn was carried over and expanded upon from the former Millennium Development Goals (MDGs). AMCON is not meant to liquidate companies with non performing loans especially where the company has not committed any crime. Rather they are meant to partner with these companies for better asset management, business recovery, profitability and scheduled payments on loans. AMCON is not a bank and should not be operating like a bank by forcing liquidation of assets which is a corrupt practice. And corruption has of course become a big issue in Nigeria since the current government came to power. Shortly after the London Anti-Corruption Summit which took place in May this year, Nigeria became a part of Open Government Partnership (OGP) being a global initiative to fight corruption through making government more open to the people. OGP was established with about 6 member countries in 2011 and is now made up of more than 70 member countries of which Nigeria became a member in June 2016. Under the terms of this partnership, Nigeria must: (1) Expose corruption, (2) Punish corruption, (3)Compensate the victims of corruption and finally, (4) Weed out the culture of corruption wherever it exists. 

IN CONCLUSION AND PREFERRED REMEDIES

The Federal Government recently launched the CHANGE BEGINS WITH ME campaign which is designed to wake Nigerians up to the fact that government is not the only agent of change but that the citizens too are change agents. Change Begins With Me therefore calls upon all Nigerians to take active steps everyday towards becoming the change they desire. One of the most critical areas where this campaign is needed is in the lives of those in charge of government ministries, departments and agencies. The spirit behind the Change Begins With Me Campaign coupled with the letters of Nigeria’s obligations under the Open Government Partnership, inspires the need to make a formal petition to the EFCC aimed at bringing AMCON back into alignment with the mandate contained in the Act of establishment of the agency in 2010.

By Barr. Chinedu Leonard Ubah.

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