$32m Debt: Reps Threaten to Arrest Polaris Bank Chief Executive
The House of Representatives has threatened to issue a warrant of arrest on the Managing Director/Chief Executive of Polaris Bank Limited, the bridge bank for then Skye Bank, for failing to appear before it to explain why it has not remitted $32 million owed to Nigerian National Petroleum Corporation.
The threat was made by its ad hoc committee on the assessment and status of all recovered loots -movable and Immovable assets-from 2002 to 2020 by agencies of the Federal Government for effective efficient management and utilisation.
The Chairman of the committee, Adejoro Adeogun, issued the threats at an investigative hearing in Abuja.
Polaris Bank Limited however said it has mandated the Central Bank of Nigeria to make the payment but Reps insisted that the money has not been received into the Federation Account. This was supported by a representative of NNPC at the hearing.
Exactly three years ago, Polaris Bank got a lifeline to take over assets and liabilities of the defunct Skye Bank Plc and had since yet to see investors that would inject capital into the lender’s operation as intended by AMCON, the CBN and NDIC.
It appears that Polaris Bank may be heading into another capital-related trouble as pulling out more than N13 billion from its tiny reserve with the CBN could hurt its operation, and threaten its going concern again.
For a while, the $32 million owed to the Nigerian National Petroleum Corporation has been generating heat amidst the scarcity of dollars in the country. Adeogun condemned the attitude of the management of Polaris Bank for not honouring an out-of-court settlement with the NNPC and failing to pay up its debt to the government.
While the bank insisted that it had completed the payment of its debt, the NNPC said it had not received the payment. Responding to a claim by the legal officer who represented the bank, but failed to identify himself, that the bank had tendered evidence of the payment.
Adeogun said, “You did not tender any evidence. You wrote a letter saying you directed CBN. Directing CBN does not mean CBN has paid the money.
“You directed CBN to use your reserve and if they make that payment, your reserve will fall below regulatory requirement. So, CBN has ignored your advice and they have not paid.
“That money is supposed to be paid into the federation account to fund the 2022 budget. So, you have between now and Wednesday next to appear here with evidence of your payment, not an instruction to CBN because that is not acceptable.
“We have to make sure that you pay that $32 million to Nigerians.” The Chief Financial Officer, NNPC, Umar Ajiya, said at the hearing that the NNPC was yet to receive the payment from the CBN, saying “Polaris Bank is still owing us $32 million”.
In June 2021 the Managing Director of Polaris Bank, Mr Innocent Ike, has said that the bank has refunded the $300 million lodged with the bank by the Nigerian National Petroleum Corporation (NNPC) in 2012.
Ike said this while appearing before the House of Representatives ad hoc committee on the assessment and status of all recovered loots from 2002-2020.
He said that the money deposited with the bank by NNPC was at no time hidden from any government agencies, adding that the money should not be classified as a looted fund.
The managing director explained that part of the strategy adopted in payment of the deposit was to remit it to the Central Bank of Nigeria (CBN) and gave the apex bank instruction to credit the NNPC.
He said that the NNPC was yet to confirm the receipt of the money paid into the apex bank’s account, while urging the NNPC to write and confirm payment, stressing that Polaris bank had written to the CBN to that effect.
Ike stressed that there was never a time the money was not disclosed in writing or was there any time it was hidden from the public or government agencies.
The managing director also disclosed that the interest of the sum kept with the bank since 2012 was dully paid.
The committee however queried the motive of NNPC keeping the sum with the bank without having an initial account with the bank before the $300 dollars was lodged with it.
Rep. Adejoro Adeogun, the Chairman of the committee, said that such motive was suspicious, adding that money was also hurriedly paid to NNPC when the bank received a letter from it to appear before the committee for an explanation.
He stated that the money had been spent seven years with the bank without any action, adding that the bank must have thought the money had been forgotten.
“You have about six years when this deposit was in your custody. It is impossible to forget 300 million U.S dollars; were you thinking it is has been forgotten?” he asked.
He accused the bank of exhibiting carelessness when it comes to money deposited by the Federal Government.
However, one of the petitioners, Tosin Ojomo, a lawyer who appeared before the committee, faulted the managing director’s claim, stating that Polaris bank was arrested before it confessed that the money was truly in its custody.
The committee then summoned the NNPC and CBN for further clarifications on the status of the money but asked Polaris to furnish it with documents relating to cash movements in the account from 2012 to 2020.
It is not clear what investors have not shown interest in Polaris bank after three years of operation. #$32m Debt: Reps Threaten to Arrest Polaris Bank Chief Executive
