UBA Seeks Jail Term for WEMPCO Directors in N61bn Loan Recovery Drive
United Bank for Africa (UBA) Plc has asked a Lagos court to jail nine people linked to Western Metal Products Co. (WEMPCO).
The bank alleges that they forced a court-appointed receiver out of the steel group’s Ogun State factory, and the application is the latest step in UBA’s effort to recover N61.45 billion, it says, that the industrial conglomerate owes.
The committal notice was filed at the Federal High Court and published in The Nation on Tuesday (Oct. 27) under an order allowing service by newspaper.
It accuses the respondents of “wilful, deliberate and orchestrated disobedience” of an April 2 order and asks that they stay in prison until they comply.
Those named are Lewis Shui Noor Tung, Phillip Shui Che Tung, Alhaji M.A. Ola Yusuf, Tung Lawrence Blake, Alli Aare Hadji Tokunbo, Paul Shui Po Tung, Robert Tung, CL Ip and Taiwo Alli. All are listed at 18 Wempco Road, Ogba, Ikeja.
Alli is managing director of Nigerian Enamelware Co. Plc, which is listed on the Nigerian Exchange and is one of the 17 defendant companies. Robert Tung sits on its board.
On April 2, Justice Akintayo Aluko froze up to N61.45 billion of WEMPCO-linked funds across 27 banks and fintechs. He also appointed Romeo Ese Michael receiver-manager over assets not already pledged under a 2019 credit agreement.
UBA’s affidavit says that after bailiffs handed over the Magboro/Ibafo plant, the respondents brought in thugs, broke the receiver’s locks and threatened his staff with “serious injury.”
It says they kept running the business and diverting its funds. None of the allegations has been tested in court, and WEMPCO’s response was not immediately available.
The court papers also show failed talks.
On June 22, WEMPCO’s lawyers at SimmonsCooper Partners, led by Dapo Akinosun, a Senior Advocate of Nigeria, asked UBA for an urgent meeting. They proposed an interim standstill, a joint reconciliation of the accounts and “a structured framework for repayment.”
UBA’s lawyer, Temilolu Adamolekun, also a Senior Advocate of Nigeria, replied the next day. He questioned how the same company “deploying physical violence on ground and resorting to self-help” could ask for dialogue, but agreed to meet.
The two sides met at UBA’s Marina head office on June 26 and agreed a joint inspection of the Magboro site for July 2. WEMPCO and its lawyers did not show up and have since “gone incommunicado,” the affidavit says.
The bank says the plant has stayed under the respondents’ control since then. MoneyCentral first reported the WEMPCO action on Oct. 16, when UBA won a judgment against Stallion Group using the same receiver.
Justice Akintayo Aluko on April 2 froze up to N61,445,695,993.76 of WEMPCO across 27 banks and fintechs and appointed the receiver-manager.
Under the April 2 order, banks and fintech platforms including Moniepoint, OPay and Kuda must disclose and hold any balances belonging to the defendants. The receiver’s powers also cover two Wärtsilä power generators “wherever they may be found.”
The other defendants include Lagos Oriental Hotel Ltd., United Rolling Mills Ltd., Wempco Steel Mill Co. and Prime Nigeria Tiles Co.
WEMPCO was founded by K.F. Tung, who first came to Nigeria in 1967.
The case tests whether Nigerian court receivers can actually take control of a borrower’s assets. A committal order against WEMPCO’s controlling shareholders would send a strong message to other chronic debtors. DMO Raises N2trn from Bonds to Fund Nigeria’s Budget Deficit
