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BUSINESS: GTBank Drags 60 Bank Executives To Court Over N17bn Debt

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Guaranty Trust Bank has dragged no fewer than 60 top executives of 13 commercial banks to court as a pending suit between GTBank and Afex Commodity Exchange over N17bn Anchor Borrowers Programme loan lingers.

The 60 executives including the chairmen, chief executive officers, directors, and company secretaries of the 13 banks are facing contempt proceedings for allegedly failing to implement a No-Debit-Order reportedly placed on the accounts of Afex Commodity Exchange with the banks.

In suit no FHC/L/CS/911/2024 involving Guaranty Trust Bank Limited and AFEX Commodities Exchange Limited, the Federal High Court, Lagos division presided by Justice CJ Aneke signed an order for the bank chairmen, MDs, directors, company secretaries and the liquidator of Heritage Bank (Nigeria Deposit Insurance Corporation) to be committed to jail for failing to obey its May 27, 2024 ruling.

A legal notice titled ‘Order to serve notice of disobedience to order of court vide newspaper publication’ published in some national dailies on Thursday, partly read, “An order granting leave to the Plaintiff Applicant to serve Form 48 (Notice of Consequences of Disobedience to Order of Court) dated 11th June, 2024 and all other forms and processes that may be issued in this contempt proceedings inclusive of Form 49 on the 1st-60th parties cited for contempt

The matter was adjourned to next Thursday.

Parties cited for contempt include  Access Bank, Citibank, Jaiz Bank, Union Bank, Fidelity Bank, First Bank of Nigeria Plc, First City Monument Bank, NDIC (liquidator for Heritage Bank), Polaris Bank, Stanbic IBTC Bank, Standard Chartered Bank, Taj Bank, United Bank for Africa and Zenith Bank alongside its principal officers.

In the court ruling dated May 27, 2024, twenty banks were directed to transfer monies standing to the credit of the respondent into the AFEX’s account with GTB until the N17.81bn is repaid.

The N17.81bn loans comprise N15.77bn; the amount outstanding and unpaid, as of April 17, 2024, and the cost of recovery and incidental expenses in the sum of N2.04bn.

The court also granted an injunction allowing GTB to take over AFEX 16 warehouses located across seven states and sell the commodities stored in them, which it said were procured with the Central Bank of Nigeria Anchor Borrowers’ loan facility.

Earlier in the month, the court had served contempt proceedings against AFEX and some of its principal officers including Ayodele Balogun, Jendayi Fraaser, Justin Topilow, Mobolaji Adeoye and Koonal Ghandi.

According to court papers, AFEX had sourced the Anchor Borrowers Programme Loan facility from GTB to provide finance for smallholder farmers registered under the CBN Anchor Borrower’s programme.

The loan was expected to be repaid from the sale of commodities. However, AFEX failed to uphold its end of the deal even after an extension.

In a statement following the interim court order, AFEX claimed that it had repaid about 90 percent of the loan facility.

“However, a portion of the loan remains outstanding with the farmers and while we have paid out a portion out of our own purse, we remain in discussions with CBN over the outstanding amounts of the said facility,” the exchange said.

It also said the full value of the loan was utilised to provide input to farmers in three consecutive seasons, starting in 2020.

The exchange added that it had remained consistent with repaying the loans until economic headwinds impacted the operations of the farmers that they had disbursed the money to.

“Over 800,000 hectares of farmland were financed through the course of the programme’s operationalisation; however, significant macro and policy headwinds, including the cash crunch on the back of the Naira redesign policy, severely impacted the productive capacity and market participation of the smallholder farmers in the 2022/2023 season.

“This resulted in less than 40 cent repayment from farmers on their input loan bundles, down from our 90per cent repayment rates in the previous eight years of providing input financing for farmers. The low repayment rate ultimately impacted on our ability to refund the full value of the loan at the end of Q1 2023 and following a 6-month extension period,” AFEX added.

The commodities exchange also stated that the lingering effects of the cash crunch have continued to impact farmers, who sold at below market value to get immediate cash inflows to sustain their families in the period and remain unable to pay back.

Meanwhile, AFEX has called on the Central Bank of Nigeria to activate the collateral guarantee of up to 70 per cent clause included in the Anchor Borrowers programme.

“Evidenced in the attached letters, our engagements with Guaranty Trust Bank Limited, a Participating Financial Institution in the program, as well as the apex bank have seen us highlight these limitations on the part of the defaulting farmers with suggestions being made to the CBN to activate the risk-sharing structure put in place for the program and release funds accordingly to sustain activities and allow for needed recovery efforts in our agriculture sector.

“In light of these engagements, we consider the recent steps by Guaranty Trust Bank Limited to be premature, coming in the midst of open conversations that are being had with all parties to find a path to resolution that does not unduly punish farmers, who have been the biggest hit by macroeconomic conditions that they had no control over,” AFEX concluded.

CBN at the inception of the programme in 2015 said the broad objective was to create economic linkages between smallholder farmers and processors to increase agricultural output and ensure food price stability.

The  Anchor Borrowers’ Programme guidelines stipulate that upon harvest, benefiting farmers are to repay their loans with produce (which must cover the loan principal and interest) to an anchor, who pays the cash equivalent to the farmer’s account.

By 2022, at least 4.8 million people had benefitted from the Anchor Borrowers Programme and the  CBN in a 2023 statement said it released N1.079tn  under the programme, out of which over N500bn is due for repayment.

The programme has since been discontinued by the CBN as it pivots from development financing interventions to its core duty of price and monetary stability.

BIG STORY

Police Arrest 31-Year-Old Medical Doctor, 3 Others Over Alleged Sale of Newborn For N2.5m in Lagos

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The Lagos State Police Command has arrested a 31-year-old medical doctor, a traditional birth attendant, and two other individuals (all names withheld), accused of conspiring to sell a newborn baby for N2.5 million.

Police said the case was initially reported at Area E Command, Festac, and was transferred to the State Criminal Investigation Department, Yaba, on June 1 for further investigation into allegations of conspiracy, stealing, and child trafficking.

The investigation is being handled by Anti-Human Trafficking/Gender detectives under the supervision of the Deputy Commissioner of Police in charge of SCID, Mr. Dayo Akinbisehin.

Details of the case

According to police sources, the baby’s mother (name withheld), aged 28, and her boyfriend allegedly decided not to keep the child and sought individuals who could facilitate the sale after birth.

The couple was reportedly linked to a prospective buyer in Ikorodu through intermediaries.

The pregnant woman was first taken to a traditional birth attendant for delivery.

Due to complications during labour, she was referred to a private hospital operated by a medical doctor, where she underwent a Caesarean section. Both mother and child survived the procedure.

Shortly after delivery, arrangements were allegedly concluded within the hospital premises for the sale of the newborn to an unidentified buyer for N2.5 million.

The baby was subsequently handed over to the buyer, who remains at large.

A police source said efforts to trace the buyer have been unsuccessful, as the address and telephone number provided turned out to be false.

“The information supplied by the person who took the baby turned out to be non-existent. The address could not be traced, and the phone number was incorrect,” the source said.

Investigators said the baby’s mother initially consented to the arrangement but later raised concerns after allegedly receiving only N700,000 of the agreed N2.5 million.

The matter came to light after she reported the unpaid balance, prompting involvement from non-governmental organizations and a police report.

Arrests and Ongoing Search

Police identified one of the principal suspects as a 31-year-old medical doctor who had been in practice for about four years.

Another woman, alleged to have facilitated the transaction, as well as the buyer of the baby, is currently being sought by investigators.

During a raid on a residence linked to the suspects, police reportedly found three young girls, two of whom were pregnant.

The discovery raised suspicion of an organized criminal scheme, leading to further arrests.

Several suspects remain in custody while investigations continue.

The police said efforts are ongoing to arrest fleeing suspects, recover the missing baby, and ensure that all those involved in the alleged trafficking network are brought to justice.

The command added that suspects already in custody will be charged to court upon conclusion of investigations.

The Lagos State Police Command stated that securing lives and property remains its top priority and reiterated its commitment to combating all forms of human trafficking.

 

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BIG STORY

No New Telecoms or Fuel Taxes, FG Clarifies Amid Public Concern

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The Federal Government has dismissed reports suggesting that it has adopted or is considering new taxes on telecommunications services and petroleum products following the publication of the International Monetary Fund (IMF) Article IV Consultation Report on Nigeria.

The clarification followed reports that the IMF had said Nigeria may need to extend VAT to fuel products and introduce excise duties on telecommunications services to raise revenue, fund development, and social spending.

However, a statement by Efe Ovuakporie, Head Information and Public Relations Unit, Ministry of Finance, on Wednesday, the government said the reports misrepresented the content of the IMF report and did not reflect its policy direction.

“The IMF Article IV Consultation Report contains the Fund’s assessment of Nigeria’s economy as well as recommendations for consideration by the authorities.

“Those recommendations do not amount to government policy and are not binding on Nigeria. Decisions on tax matters are taken through established constitutional and legislative processes and are guided by national priorities and prevailing economic realities”.

The government clarified that the Value Added Tax (VAT) waiver on petroleum products remains in place and has not been withdrawn.

It also noted that although existing legislation provides for a fuel surcharge, such a measure can only take effect through a ministerial order and publication in the Official Gazette.

“No such process is under consideration.

“The continued suspension of these charges has helped cushion the effect of global energy price fluctuations on households and businesses while keeping domestic fuel prices relatively stable”.

The government further clarified that the telecommunications excise duty introduced before 2023 has been repealed under the new tax laws and is therefore no longer applicable.

Against this backdrop, the statement noted that reports claiming that new taxes are being planned for telecommunications services or petroleum products “are not factual and should be disregarded”.

The Federal Government said it remained focused on reforms that promote economic growth, improve revenue administration, and create a more competitive environment for investment and job creation.

“The emphasis remains on expanding economic activity, plugging leakages, and improving efficiency rather than placing additional tax burdens on citizens.

“Any future tax measures will be announced through official channels and implemented in line with the law”, the statement added.

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BIG STORY

I’m Ready To Sacrifice Myself For Rescue of Ogbomoso Schoolchildren —– Makinde

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Seyi Makinde, governor of Oyo, says he is willing to sacrifice himself if that would secure the release of schoolchildren and teachers abducted by gunmen in the state.

Makinde spoke on Tuesday while addressing protesters led by Martins Otse, the activist and social media influencer popularly known as VeryDarkMan (VDM), at the Oyo State Government House in Ibadan.

Hundreds of protesters marched through major roads in the Oyo capital before converging on the government house to demand the urgent rescue of the abductees, who had been in captivity for one month on Monday.

The governor said security agencies have continued efforts to secure the victims’ release, adding that personnel involved in the operation had suffered casualties.

“Oyo state is not Chibok, and it will not be Chibok. We have lost men, soldiers, on this. I can confirm to you that a lieutenant in the Nigerian Army was killed a few days ago,” he said.

“If you ask me, can I sacrifice myself for those children to come out, I will do it. I have lived a good life. I am almost 60. It doesn’t matter. My own father died at 76.

“This is Oyo state. They know that this is not Chibok, and our children will never be in the same situation as the Chibok children.

“We are doing everything possible, including what you suggested. But there is the potential for needless loss of lives. We have lost a teacher already.

“If we can avoid losing more, we will avoid losing more. But if we get to the point that certain people have to be sacrificed, including myself, we will do it.”

Makinde said the government will not negotiate with the abductors, warning that doing so would amount to surrendering the state’s authority to criminal groups.

BACKGROUND

On May 15, gunmen attacked three schools in Oriire LGA of Ogbomoso, abducting 39 pupils and seven teachers, including the principal of one of the affected schools.

Days later, the abductors killed Michael Oyedokun, one of the abducted teachers, while he was in captivity.

The abduction sparked outrage on social media and triggered protests across the country, calling for the release of the victims.

Last Friday, Makinde said intelligence reports indicated that the abductees were still being held within the old Oyo National Park.

He said the area spans about 2,500 square kilometres across parts of 10 local government areas, making rescue operations difficult.

“The size and difficult terrain of the area pose significant operational challenges for security personnel, requiring patience, strategic coordination, and sustained efforts to ensure a successful rescue operation,” the governor had said.

 

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