| How Governor Fayose, OBJ's political 'Godson' looted Ekiti State |
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| Monday, 07 August 2006 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Forwarded by Omoyele Sowore
For about two months, Ayodele Fayose, governor of Ekiti State, had been a very happy man. The governor, who has moved from one controversy to the other since he came to power in 2003, had reasons to be happy. While on a state visit to Ekiti State last May, President Olusegun Obasanjo had virtually anointed Fayose as a “worthy son”. Raising up the governor’s hand in the crowd, the President advised his opponents and critics to sheathe their swords and join him in the development of the state. To cap it all, the President sang a song in Yoruba: "Omo ko le jo baba ki a ma binu omo…", meaning that a child should not be blamed for taking after his father. Invariably, Obasanjo anointed Fayose as a political son. That presidential endorsement thrilled Fayose to no end. But Fayose was, last week, brought back to earth and to the realities of governance and politics in Ekiti State following the arrest of two people — a friend and contractor to the state government who had been embroiled in a contract scam, and a special assistant to the governor. The governor is said to have become very worried about the arrest of the two men. The friend, Gbenga James, was arrested about two weeks ago, while Goke Olatunji, the governor’s aide, was arrested last Monday for alleged involvement in what many believe is the failed Ekiti State Integrated Poultry Scheme for which over N1.4 billion has been paid without commensurate work done. Fayose is alleged to have colluded with James to collect the money ostensibly meant for the poultry project, but, rather than execute it fully, they allegedly diverted most of the money to personal use and went on a spending binge. But the poultry scam is only one of the several investigations concerning Fayose. The President’s anointed son is also being investigated for allegedly bribing Ekiti State legislators to impeach his former deputy, diversion of public funds, using the dualisation of the Ado–Ikere and Ado-Ekiti township roads to siphon money, among other allegations. The story of the poultry saga alone is a treatise on executive recklessness and lawlessness, and wanton abuse of office. It all started in early 2004 when James, an agriculturist and managing director of Biological Concepts Limited, who is also a long-standing friend of Fayose, brought him a proposal for the establishment of an integrated poultry project in the state. The original proposal was for the building of four poultry farms in four centres in the state with the project headquarters in Afao, the governor’s hometown. The project was to cost N400 million but, according to James’ proposal, the state government was to commit N100 million while Biological Concept was to contribute N300 million through a loan of same amount from Wema Bank. Furthermore, a profit-sharing arrangement was proposed which would give Biological Concepts 70 per cent and Ekiti State government 30 per cent of profits. Ordinarily a beautiful business proposition some might say. But the project has not turned out beautifully. What really happened? James said that the governor expanded the scope of the project so that, instead of just the four poultry farms in four locations in the state, he asked that James include a proposal for one poultry farm in each of the 16 local government areas of the state. This too was to cost N400 million at N25 million each. Each local government council was expected to pay the N25 million. Although he was a contractor to the project, it was agreed that he would collect a consultancy fee of 15 per cent, amounting to N60 million, on the local government poultry project. But there were several snags to the implementation of the proposal. First, there was no provision for a poultry project in the budget of the state for 2004. Secondly, without requisite collateral, Biological Concepts was not able to secure the loan from Wema Bank but the governor decided to undertake the project with state funds even though the profit-sharing arrangement would still give James’ company a 70 per cent share of profits. He went ahead to secure the N300 million in the name of the state government. In March 2004, just a couple of weeks after James submitted his proposal, Fayose approved the payment of N400 million to Biological Concepts to start executing the project. On April 22, 2004, Biological Concepts was issued a Standard Trust Bank cheque of N340 million, representing N280 million mobilisation fee and N60 million consultancy fee. Of course, there were many things wrong with the payment. First, the expenditure was not appropriated. Second, the whole contract award set aside all due process as it was neither advertised for competitive bidding nor allowed to go through the tenders’ board as required by law. Furthermore, at the time of making the first payment, there was no contractual agreement between the state government and Biological Concepts. It was just a “paddy–paddy” arrangement between the governor and James. It was in September 2004, when queries started being raised about the whole matter, that the government now entered into an agreement with the company. What is more, the governor was said to have illegally authorised the money to be paid from the Local Governments’ Joint Account even though none of the councils had appropriated money for a poultry project. Also, it was discovered that no tax was deducted from all monies paid to Biological Concepts. All these happened in spite of warnings and queries raised by three people: Abiodun Aluko, the former deputy governor, the auditor-general of the state and the secretary to the state tenders' board. For example, when the deputy governor got a directive from Fayose to release N400 million from the Local Government Joint Account to Biological Concepts as mobilisation fee, Aluko had written the governor warning of the consequences of not following due process. In the memo dated March 12, 2004, Aluko observed that the company was unknown to the state government as it had not previously done any job in the state to warrant the release of money to it. The auditor-general then detailed the due process which the company needed to go through before funds could be released to it. These included the writing of a proposal stating the scope of the work and attaching a bill of quantities, appraisal of the proposal and auditing of quotations by state officials, vetting of the contract by the state tenders board and, finally, award of the contract. Aluko ended his warning memo thus: “For future reasons, these statutory procedures should be adhered to strictly to avoid being accused of collusion to defraud the government as the sum of N400 million is too high to be released to a private company without going through all this statutory documentation”. But, curiously, Aluko later recommended the company for payments due to it later. Although it is believed that about N1.4 billion has so far been spent on the ill–fated poultry project by Fayose, TELL investigations could only confirm the payment of N855 million to Biological Concepts. The payments were made between April 22, 2004 and October 5, 2005. An indication of the fact that Fayose and James possibly planned to use the poultry scheme as a conduit for siphoning state funds emerged as soon as James got the N340 million cheque from the state government. On April 22, 2004, the same day that the cheque was paid into Biological Concepts' account, even without mobilising to site, James withdrew N55 million from the money. Interestingly, his company’s account was in the red to the tune of N58 million by the time the money was paid. This amount was deducted by the bank as soon as the account was credited. But it was gathered that the Economic and Financial Crimes Commission, EFCC, has since told the bank to pay back the money as it belonged to Ekiti State and not Biological Concepts. A week later, James transferred another N20 million into the account of Avian Specialists, another company he owns. In all, he was discovered to have transferred nearly N200 million from the Ekiti poultry fund into Avian Specialists account. James said that they were all loans. Then on May 10, the contractor opened a letter of credit of N156 million in favour of Avian Specialists for the importation of cages and drinkers from India. In the official papers, James claimed that the imports were for the Ekiti poultry project but, when the items came, he sold most of them to the public and sent the remaining to a farm he owns in Ibadan. With a large fortune chest at his disposal, James descended on markets in Nigeria and abroad and went on a spending spree buying exotic cars and property as well as turning his farm into hi-tech automated one. It was also discovered that James originally put the cost of the four centres to be headquatered at Afao at N56 million, but the governor told him to inflate it to N300 million. Thus, N244 million was allegedly shared between them. Fayose also allegedly got another N17 million which he asked to be changed into foreign currency. Of the amount, N7 million was changed into $50,000 and allegedly handed over to Abiodun Olujimi, then a member of the House of Representatives but now deputy governor of Ekiti State, to give to the governor. Olujimi collected the money from James’ secretary and signed for it on April 29, 2004, just a week after the contractor was mobilised. Originally, when James was questioned about the money earlier in the year, he lied that he gave the money to one Tunde Oshinowo to help him purchase a property, but when Oshinowo denied any knowledge of the money, James confessed that he gave it to Fayose through Olujimi. The remaining N10 million was also changed into £37,000 and given to Olatunji to pass on to Fayose. The governor was said to have actually gone to James’ office in Ibadan but stayed outside while he sent Olatunji upstairs to collect the money. However, as if the loot was limitless, others who worked for or were close to the governor also benefited from the largesse from Ekiti State. For starters, James claimed that he paid several millions of naira to many civil servants in Ekiti State as 'PR'. For Example, Kayode Osho, the commissioner for finance, and Boboye Olanipekun, the commissioner for agriculture, at different times, got sums ranging from N250,000 to N1.5 million while Aluko, the former deputy governor, was allegedly paid N7 million. Other civil servants who allegedly benefited from the loot, according to records scrupulously kept by James, include the attorney-general, the state’s paymaster, accountant-general, permanent secretaries, director of building, surveyors and Olatunji, among several others. James claimed that he bought 20 units of air conditioners for Osho and the chairman of the State Primary Education Board, SPEB, which they shared equally. The air conditioners were allegedly delivered to them by one Emmanuel Nuga. James also said that he bought a Mercedes Benz car worth N2.5 million for the governor’s mother from the poultry contract windfall. Members of the state House of Assembly, according to the consultant, also had their share as he gave some of them who paid him a visit in Ibadan N2 million to share. Interestingly, it is alleged that the original team that investigated the poultry scam also benefited from the loot. Two officers of the EFCC were allegedly given N18 million to doctor their report on the investigations. It was gathered that they actually wrote a report indicating that the project was a success and that what they found on the ground was worth much more than the amount that had been paid to the contractor. However, Nuhu Ribadu, chairman of the commission, who had got independent reports on the project, rejected the initial report and detailed another team which eventually concluded the investigation. The two officers, it was gathered, have been sacked by the commission. After concerted efforts to talk to the governor over the past three months, the magazine eventually got an appointment to talk to him last Tuesday. But he refused to speak on the issue. He pleaded that it was not an auspicious time to talk to the press, particularly as he had not got enough information about the arrest of Olatunji the previous day. But a source close to Fayose rose in stout defence of the governor, insisting that he did not collect a penny from James from the poultry money. According to the source, the matter is giving Fayose a lot of concern. And he did bare his mind at a discussion with some friends last week. The governor claimed that, although it was true that James helped him build a house, he paid him about N40 million from his own pocket for the project, adding that if James decided to spend the money and pay from the poultry funds, he could not be held responsible. He told the friends that he had bought the house before his election to the office of governor. Initially, he wanted to renovate the house, but James sold him the idea of pulling it down and building a new one. He reportedly claimed that the project started well ahead of the discussions on the proposal for the agriculture project. Still, the governor could not, or failed to see the corruption in asking a contractor currently handling jobs for the state to supervise the building of a personal house for him. On the allegation that James bought a car for the governor's mother, Fayose explained that he gave N2.5 million to James to purchase a brand-new Kia car in mid-2003 and that he was surprised that James was claiming to have paid for the car from the poultry project money which he got in 2004. The governor expressed shock at all what James had claimed in his statement to the EFCC but observed that what the commission should have ascertained was if he had proof. Fayose wondered how he could have alleged that he paid so much money to him without being able to produce a cheque or other documents as proof. Except that Fayose did not also show proof of payments from his pocket to James. The governor said that he never knew that James transferred N156 million from the poultry funds to India or that he used the funds for his other businesses. Asked why the state kept on paying the contractor in spite of the slow pace of work, the governor explained that, when he realised that James was getting too slow on the job, he formed a committee that had been monitoring the project and that he could not take an action against him yet because its completion date was not yet due. He equally explained that it was not really true that there was never any agreement between the state government and the contractor before payments were made to him. According to the governor, the state executive council had agreed with the contractor on everything that had to do with the poultry contract but that he queried the agreement that was brought for approval and that it was an amended one that finally came. The EFCC is also investigating an allegation that another N500 million may have been paid out of government coffers in connection with the poultry project apart from the N855 million, which has landed so many people in trouble. It is believed that the governor paid out the money, claiming that it was meant to buy birds for the non-existent poultries. The magazine gathered that when James was confronted by investigators over the N500 million, he told them that he collected no such money but added that when he heard that over N1.4 billion had been paid on the poultry project, he confronted Fayose who explained that that part of the project did not concern him and that it was for another contractor to stock the poultry farms with birds. With the huge investment in the poultry project, Ekiti State has little to show for the scheme. With most of the funds meant for the project diverted for personal use, Biological Concepts has been able to put in place some of the poultries in only about six local governments and this came only after the hoopla that has greeted the entire scheme. Even then what is on the ground in these places is a far cry from what is in the bill of quantities submitted by James. Each poultry unit was planned to be an integrated scheme with pens and cages for the birds, a two-bedroom bungalow farm house, borehole, water pumping machine and a back-up 10 KVA generator, another 27 KVA generator to supply electricity, a generator house and a reservoir tank. The entire scheme was also meant to be fenced. However, what had been constructed are the pens and cages to house the birds. Most of the equipment to run a modern poultry which was paid for is not on ground. Interestingly, even President Obasanjo has had cause to publicly remonstrate Fayose over the poultry project when he paid a visit to Ekit State in April 2005. And that was in spite of the governor’s attempts to hoodwink him. It was gathered that, to impress the President with his project, the governor had quickly put together some pens in some local governments and Afao. He then hired some birds from a farm in Ibadan and put them in the cages. But Obasanjo, himself a farmer, was not taken in. The President wondered why the usual smell that is characteristic of a poultry environment was missing and advised the governor to leave such ventures to the private sector and concentrate on serious development issues. Obviously, Fayose did not listen to the man who has now become his political father despite his having tried to make a public show of this. In July 2005, the governor, through Kayode Otitoju, his information commissioner, had told protesting workers who had been laid off from some of the existing projects in Ado Ekiti that the state government was disengaging from the entire poultry project to allow it to be run by Biological Concepts. He added that the decision was informed by the advice of President Obasanjo when he visited the state. But the commissioner was silent on what would become of the state’s huge investment in the scheme. A source told the magazine that the findings on the poultry scheme are just a tip of the iceberg as the governor had also been found to have committed other acts of corruption. For example, investigations into allegations of bribery of members of the state House of Assembly may have been confirmed to be true. Fayose allegedly gave 19 of the 26 members of the House N2 million each to induce them to impeach Aluko, the deputy governor, in 2004. The remaining seven members who would not play ball were not given the bribe initially, but when the EFCC began investigating the matter, the state government quickly paid N2 million to the seven and claimed that the money was part mobilisation for the execution of constituency projects in the legislators’ constituencies. In a report, the team that investigated the matter concluded that the money was meant to bribe the legislators to effect the impeachment of Aluko and that the payments to the seven members and claims of executing constituency projects were an afterthought. “It is our sincere opinion that these projects were hurriedly started immediately an invitation letter was extended to the House”, the team wrote in its report. Many reasons account for their reaching this conclusion. First, if the money was meant for constituency projects, why was it paid directly into the accounts of the members and not those of the contractors? Also, why was the money initially paid to only the 19 members loyal to Fayose? But, more importantly, it was discovered that, considering the time the money was released, many of the projects ought to have been concluded but, not only were they in the early stages of construction, many of them did not follow the bill of quantities which were submitted to investigators. Also, as the jobs were being hurriedly done as “window dressing”, the materials used were equally found to be sub-standard. The legislators were visitors to the EFCC office in Lagos earlier in the year where they claimed that the N2 million was for constituency projects. However, another invitation extended to them after the agency’s officials went to inspect the projects has not been honoured. Rather, some of the legislators went to an Ekiti high court to seek an injunction restraining the commission from further arrests of state government officials. The court granted their prayer. Although the EFCC has virtually concluded investigations into the allegations concerning the poultry project and the alleged bribing of legislators, it is still investigating several other allegations against the governor. These include allegations of diversion of local government funds, inflation of road construction contracts, squandering of over N500 million on the purchase of cars between February 2004 and September 2005, and the operation of foreign accounts. Feelers from the investigating team indicate that the poultry scam is nothing compared to the atrocities that the governor has committed with local government funds. The investigators would not disclose details of their findings so far so as not to jeopardise the investigations, but it was gathered that what the governor releases to local governments is mere pittance compared to what comes to them from the Federation Account. It is a big scandal, which is said to involve not only the governor but also local government chairmen, members of the state House of Assembly and others. The entire investigation process was triggered by one of several petitions by Morakinyo Ogele, a lawyer from Ekiti State who practises in Akure, the Ondo State capital. In the last two years, Ogele has inundated the EFCC with an avalanche of petitions. The lawyer told the magazine in Akure at two separate interviews that he had nothing against the governor except that he, as an indigene, was miffed at the wanton looting of the treasury of his state. Ogele, who also publishes News Herald, a newspaper passionately devoted to criticising the Fayose administration, is a walking encyclopaedia on the corrupt ways of the Ekiti State governor and other public officers in the state. And, for every accusation, uncannily, he provides evidence backed by documents. At a point, Ogele got exasperated about what he deemed the slow pace of work by the EFCC and gave the commission 30-day ultimatum to commence investigation into his petition, failing which he would initiate legal action asking the court for an order of mandamus to compel it “to perform its constitutional responsibilities”. Last week, Ogele expressed satisfaction with the EFCC’s work when he heard that James and Olatunji had been arrested. What he did not know then was that the EFCC had perfected plans to charge the two men to court. Biological Concepts and Avian Specialisties, James' two companies along with himself, Goke Olatunji, the PA to Fayose, are facing a 15-count charge mainly for money laundering. They were arraigned last Wednesday. An interim order of a Lagos high court is also being sought for the forfeiture of assets and properties belonging to Fayose, James and the governor's mother (see box). But by the time the lawmakers return to court in Ado-Ekiti on September 25, the petitioner, Ogele, too, may be in the witness box. This follows the order of Kayode Bamisile, chief judge of the state. He was acting on the complaint of Adeniyi Akintola, Senior Advocate of Nigeria, SAN, and counsel to the lawmakers. The lawyers complained about certain remarks credited to Ogele in a media report. The unfolding drama promises to be even more revealing in the months ahead. By DAYO AIYETAN
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Posted by Robot| 07.08.2006 17:51