Nigerian governors have written a protest letter to the finance minister, Zainab Ahmed, advising her against the payment of the controversial $418 million Paris Club refund-related judgment debts.

At the prevailing official exchange rate of N410 to $1, the money amounts to about N171billion.

In their letter dated September 1, the governors described her directive for the payment of the debts in disregard for their appeals against the controversial judgment debts as an act of “corruption and lawlessness”.

They urged the minister to withdraw the instruction to the Debt Management Office (DMO) to issue promissory notes to the creditors, quoting a Supreme Court decision that warns any person taking steps that defy court processes as acting “at his peril”.

In the 1986 Emeka Odumegwu Ojukwu case cited by the governors as judicial precedent, the Supreme Court also asserts its ability “to restore the status, wholly irrespective of the merits as they may be ultimately decided”.

Femi Falana, the governors’ lawyer, who signed the letter to the minister, advised her “to be guided by the admonition of our highest court as quoted above”.

He advised the minister to be mindful of the apex court’s decision “by withdrawing your directive to the Debt Management Office to issue promissory notes to any contractor and consultant pending the determination of court processes in respect of which your office has been served and notified of their hearing dates”.

PREMIUM TIMES had exclusively reported how the finance ministry, through its permanent secretary, Aliyu Ahmed, directed the DMO to start issuing promissory notes to the six creditors as the means of settling the suspicious debts.

The August 12 letter cited President Muhammadu Buhari’s earlier letter dated January 11 approving the settlement of the debts through the issuance of promissory notes to be funded from the allocations of the state and local governments for 10 years.

Our previous report revealed the President’s approval ignored repeated demands by the Kayode Fayemi-led Nigeria Governors’ Forum (NGF) for a forensic audit of the claims of the creditors.

Series of our exclusive reports on the matter identified the trio of the Chief of Staff to the President, Ibrahim Gambari, the Attorney-General of the Federation, Abubakar Malami, and the finance minister, as spearheading the desperate push for the payment despite wide-ranging issues that cast doubts on the legitimacy of the indebtedness.

The issues raised from various quarters range from partial or non-execution of contracts to opaque deals leading to the consent judgments given in favour of the creditors.

A report of the Economic and Financial Crimes Commission (EFCC) has also discredited about $159 million being claimed by one of the creditors.

The Association of Local Governments of Nigeria (ALGON) had similarly sent separate letters to the AGF saying the borehole contracts its members gave one of the claimants laying claim to the $159 million were not executed.

In April, the NGF, through Mr Falana, wrote the finance minister, asking her to suspend moves to begin paying the money as it was set to file appeals against the judgments.

Suits filed, hearing date fixed

In the fresh protest letter against the humongous indebtedness, Mr Falana queried “the special interest” the finance minister is showing in the payment in the face of pending court processes challenging the judgements.

“If one may ask, what is the special interest of the Ministry of Finance in directing expeditious payment of disputed claims to individual contractors and consultants in the face of valid court processes challenging the decisions of courts of first instance upon which these claims are based?”

He noted that the minister’s office had been served with court processes seeking to stop the execution of the judgments pending the determination of the appeals they had subsequently filed.

Mr Falana added that the minister’s office had also been served with a hearing notice fixing one of the motions for hearing before the Federal High Court on September 29, 2021.

“We are amazed to note that despite the service of these processes as well as hearing notice on your office, your Permanent Secretary acting under your instruction, directed the Debt Management office (DMO) to issue promissory notes to contractors and consultants, whose claims are still being challenged and contested in court,” the Senior Advocate of Nigeria stated.

‘Payment is act of corruption and lawless’

Mr Falana noted that the finance minister “is illegally authorising” the payments to be deducted from the allocations of the state governments for 10 years “to defray these bogus amounts of money”.

“We hold the strong view that this in itself is the height of corruption and lawlessness,” Mr Falana wrote in the letter, copies of which were sent to the Attorney-General of the Federation and the DMO.

He pointed out to what he referred to as her “sacred duty” of “staying action on this matter in view of the injunctive reliefs sought in the processes duly filed in court on these matters”.

“It is the law that once an application for injunctive reliefs (such as the one filed by us and already fixed for hearing) is pending in a court of law, parties are barred from engaging in any act that would foist a fiat accompli on the court in respect of that application or action,” he said.

Controversial judgement debts

The debts had accrued from court judgments awarding various sums of money amounting to about $418million to some “consultants” and “contractors”.

Some of the creditors claimed to have provided legal consultancy services of helping state and local governments to recover funds over-deducted by the federal government from their allocations between 1995 and 2002 in buying back Paris Club loans and exiting Paris Club.

The contractors among them said they were engaged to execute certain projects in all the 774 local governments in anticipation of being paid from the Paris Club refunds.

Since assuming office as the chairperson of the NGF in May 2019, Governor Kayode Fayemi of Ekiti State has been demanding a forensic audit into the agreements leading to the court judgments.

In February, the National Executive Council (NEC), led by Vice-President Yemi Osinbajo and has the 36 states governors, and some other top federal government officials, as members, also threw its weight behind the NGF’s demand for a suspension of the planned payments for a forensic audit to be carried out.

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