Joshua Dariye another fugitive governor loved by UK banks
Joshua Dariye is another governor
who use of British banks to launder money was revealed in the Global Witness
report. The former governor of crisis prone Plateau State is said to have
brought into the UK £2.85 million (N741 million) of suspected stolen funds
through two banks, NatWest and Barclays. Following his arrest in 2003, Police
also recovered £80,000 (N21 million) in cash from his London home.
Goodluck Jonathan-Nigeria's President
David Cameron-Prime Minister-UK
The report revealed that about £1.17
million (N304 million) of the £2.85 million funnelled into the UK by Dariye was
done through the accounts of one Joyce Oyebanjo at NatWest Bank. From July 2003 to March 2004, Dariye made seven payments into
Oyenbanjo’s NatWest Account in different instalments that came to about £1.17
million or £1.48 million (N385 million) including interest. At the time of
Dariye and Oyebanjo’s arrest only £198,045 (N385 million) remained in the
account.
As the money was transferred to
Oyebanjo’s account, she issued several cheques to Dariye on his frequent visits
to London. Her account thus became a convenient conduit for Dariye to get money
into the UK. In April 2007, Oyebanjo was convicted for money laundry charges
and sentenced to three years in prison. Dariye remains in Nigeria a free man
after fleeing from justice in UK.
Abacha was another top Nigerian
leader known to have used UK banks to launder millions of pounds. According to
an FSA report, Abacha used 23 different London Banks to launder about £900
million. A report by the Financial Times identified three of the banks to be
Barclays, NatWest and UBS.
An African banker, working in the
London financial district, who prefers to remain anonymous, said he was marvelled
at the complicity of UK banks in helping launder money despite all the checks
that are in place to prevent it from happening.
“One question I need to ask is
what the UK police and anti-fraud officials did at the onset of this
scheme.”
“Since the end 2001 and early 2002, there has
been anti-terrorist financing laws in the financial world and financial firms
have been mandated to report unusual cash transactions and systems are supposed
to be in place to alert officials, so where were they, did they look the other
way thinking that it will stop? Did they not act because they were afraid of
others finding out and as such damaging the image of London as a financial centre?”
Speaking on the Ibori case he
said “To think that Ibori could go to Barclays at Knightsbridge and deposit
£1.5m in cash is just extraordinary. How did Barclays accept that? But if I
travel with more than £2,000 on me, I will be questioned for money laundering and
possibly the cash ceased. Is this not double standard depending on your status?
“But Coming to think of it, he
was smart enough to have gone to Knightsbridge branch of Barclays where –almost
certainly – anyone who opens an account with that branch is likely to be a rich
person. He would have been turned away and the cops called had he ventured into
any Barclays four miles south in Clapham or Brixton. Makes you wonder if
Barclays anti money laundering procedure is tight.”
“Ibori’s case raises serious
questions about the due diligence that Barclays and the other banks carried out
on Ibori and his associates. What checks did these banks do to ensure that the
funds they were handling were not the proceeds of corruption?”
“It is sad what African leaders
are doing to us and our unborn children, it is a shame.”
He narrated an experience he had. “I was at a lunch meeting with some officials
from Luxembourg and a convoy of cars drove by, the guy I was at launch with told
me that the convoy belonged to an African head of state who came to Luxembourg
with his army of ministers to beg money but the funny thing was that the
authorities had a dossier of the president and his convoy and how much money
they have stashed all over the world which is far more than what they have come
to beg for.”
Another banker who also works in
the London Financial district however explained why UK banks are so eager to
take stolen money from Africa’s political looters with little or no questions
asked.
“We know how this works, any stolen money
moving from one bank to another will lose at least 5%, that coupled with broker
and lawyer fees will at least attract another 15% charge and the asset
manager’s initial fee of at least 5% tells us that any money taken illegally
away will automatically loose at least 25%. This is money we are giving people
richer than our people, what are we doing to ourselves” He asked.
However, the Financial Services
Authority (FSA), the UK bank regulator, is already taking some action to reduce
money laundry in UK banks. They carried a review in 2011 which showed that
British banks were systematically failing to carry out the required anti-money
laundering checks especially when dealing with senior foreign politicians.
Nigerian banks are the other side of a bad coin.
Analysts however say that the
British Banks are just one side of a bad coin. The other side of the bad coin
are Nigerian banks. Most of the money that end up in British banks is first
passed through Nigerian banks who are supposed to know the status of the
governors. For example, the Global Witness Report discloses that of the £2.7
million held in RBS bank account by Alams in 2005, £1.6 million (N416 million)
was transferred into that account by now defunct Bond Bank, one of the banks
that collapsed into the Skye Bank Group during the 2006 bank mergers and
acquisitions in Nigeria.
The Financial Action Task Force
(FATF) last February classified Nigeria among countries with strategic Anti
Money Laundry/Combating Terrorism Financing deficiencies that have not made
sufficient progress in combating those deficiencies or have not committed to an
action plan to working with the FATF address these deficiencies.
Sanusi Lamido Sanusi-Governor, Central Bank of Nigeria
Insiders in the Nigerian banking
industry however note that competition for government deposits is a facilitator
of political corruption in Nigeria. Most banks in Nigeria will do anything to
get a state government’s account which usually runs into several billions of
cash inflows every month as crude oil revenue is shared. To get this state
government account, bank managements usually have to incentivise the governors
by agreeing to secret terms that ensures that they keep these accounts from
competitors.
Some of the bargains reached with
the governors who are the ones who decide where these account should be kept
include agreeing to facilitate these transfers even when they know it is State
funds that are being transferred illegally. The sad part insiders say, is that,
the banks also fund the States corruption with loans which costs are then borne
by ordinary Nigerians. Most State governments are known to committed their states to significant debts from private banks most of which are transferred into their personal accounts
abroad. Most State governments are known to be significantly indebted to banks
without the citizens knowing what the money borrowed from the banks were used
for.
“The banks just lend the
governors money without asking questions. Money is learnt to governors for all
sorts of things and at the end of the day, no one accounts for how this money
is spent. Yet the State’s future allocations and tax revenues are tied to the
repayment of these loans. A good number of States have mortgaged the future
and welfare of their citizens to satisfy their present greed. And they are
doing these with the active collaboration of Nigerian banks” an insider who
prefers to be anonymous said.
Analysts insist that if the governors
have to be stopped from stealing their states blind, Nigerian banks and the
Central Bank of Nigeria (CBN) has to enforce more stringent anti money laundry
legislations.
However, the increased scrutiny
from Britain has forced Nigeria’s political looters to start diverting funds to
places like China, Brazil, India and other parts of the world where there is
less scrutiny. Dubai and other friendly Gulf states in the Middle East have
also become a major destination of stolen funds from Nigeria. Top Nigerian politicians are said to be very
active in the Dubai property market where they are said to prefer paying cash for properties while living in the most expensive hotels. Taxi drivers on the
streets of Dubai are most likely to talk about the escapades of Nigeria's money
bags once you identify yourself as a Nigerian in Dubai.
Those who know say that the
increased scrutiny is also driving stolen funds into the local Nigerian
property market and the over the counter securities trading market in Nigeria. A
top Nigerian telecom firm’s over the counter shares is said to be a preferred
investment choice for Nigerian politicians because of its high cost and good
returns. Its high cost means that politicians can use it to stash away millions
of Naira without raising too much interest. It is even more attractive since it
is traded over the counter with little scrutiny. Private equity funds are also
said to be getting some of these stolen funds from Nigerian politicians who are
doing everything to hide their loot in the face of increased scrutiny.
The UK however still remains a preferred destination by Nigeria's political looters, most of whom cannot resist the assumed prestige
of owning a property in London and sending their children to UK schools. This means that Nigerian political
looters still want to launder money in the UK. For financial regulators in Nigeria and the
UK, the challenge will remain how to break this brotherhood of the banks and
Nigeria’s political looters, oiled by profits and greed, which will endure as
long as there are banks to help them cover their tracks for a
share of the loot.
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