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...How Abacha 419ed Obasanjo

Posted by Webby on 9/29/2002 4:14:27 AM | Views: 450 |

...How Abacha 419ed Obasanjo

A Deal That Went Awry

Mohammed Abacha

It was a deal done with the utmost secrecy yet without precautions taken to cover the possible political backlash. The deal was expected to put in some money, $1.5billion, in the pocket of the federal government as well as earn a young man his freedom back into the midst of his relatives.

The family of late Gen. Sani Abacha wanted freedom for Mohammed, the oldest son of the family who was standing trial for several offences including murder and stealing of public fund. The federal government also felt it is important that what belonged to government is not cornered by the family with impunity. In any case, with the unpredictable price of crude oil, the federal government could do with extra money which legally belong to it in its coffers. Thus, the two sides called their lawyers and agreed to an exchange in which the government would drop all charges preferred against Mohammed Abacha, except the one concerning criminal offences.But the Abacha family was expected to return $1.5billion of the money their late patriarch looted from public treasury. In what has been condemned as questionable, the judiciary was brought into the deal that was to lead to Mohammed's freedom.

The two sides ended the negotiations feeling an iron-cast deal had been made. President Obasanjo noted that even contemplating such exchange was one of the toughest decisions of his three year reign. But the Abacha family was to make it tougher for the president when they started talking that they knew of no agreement other than the terms of bail under which the court ordered Mohammed release.

"Ask the man who says he has the agreement with him", Mohammed said , adding "I think he is the best person to give you an answer to that I have been reading it in the newspapers". With that stance, Mohammed Abacha seems set to call the bluff of the government after obtaining his freedom by false pretence usually referred to in Nigeria as 419.

How did it start? Was there an agreement? Is somebody trying to be clever? Does some body feel outsmarted? Have the powers and obstinacy of a family overwhelm the enormous power of the state?

Ali. M. Ali and Yakubu Musa report.

Nigeria according to Transparency international perception index, is the second most corrupt country in the world. It is also at the top of the table as one of the poorest countries in the world. In the midst of this poverty, Nigeria is believed to have realised from oil sales in the last three decades a total of about $300 billion, out of which $100 billion had been stashed away by her rulers in foreign accounts. Newsweek, an international news magazine in March 2000 led with the story of the late General Sani Abacha stating, "the death of General Abacha was by any standard a sordid affair. As Head of State of the oil-rich country that dominates West Africa, Abacha could satisfy his every desire. He could order his critics jailed or executed. He could demand a truckload of money from the central bank. Or he could indulge his sexual whims..."

Then the magazine went over to the wife. "Maryam, it was felt wanted to mourn his death by flying to Saudi Arabia. Someone got suspicious about her departure. Police stopped Maryam at Mallam Aminu kano International Airport and discovered her 38 suitcases stuffed with cash".

Then to the children. "Even before their father seized power, his eldest sons began showing up at overseas banks with huge amounts of money they wanted to deposit. Even reputable banks were notably indifferent at first about the source of the funds the young Abachas were bringing in. As part of standard procedures Citibank's US 'relationship manager' for the accounts of Abacha's two sons was supposed to make at least a superficial attempt to determine where Mohammed and Ibrahim Abacha had gotten money. But the manager Alain Ober told United States Senate investigators last year that for the first three years he ran the accounts, he didn't even know the two men were related to Abacha.

By 1997, citibank's internal documents all but call the Abacha deposits corrupt. A section of a client profile related to the source of funds for one of the New York accounts reads: "father of Ibrahim Abacha and Mohammed, General Sani Abacha, is the current military ruler of Nigeria where there is a lot of corruption"

Writes Newsweek, "Investigators in Nigeria say Abacha had given control of the assets first to Ibrahim and then to Mohammed. Ibrahim died in a 1996 plane crash".

Private Swiss banks were even less discerning about the source of funds for the Abachas. They drummed up business by sending accommodating agents to Nigeria. "There were people who actively helped carry suitcases full of cash",. The Abacha family apparently liked the service. " It's obviously abnormal that a bank would take $200 million from a 26-year old known to be the son of a dictator", said one Swiss investigator, adding that the banks will claim they did not know.

Corruption has always been part of government business in Nigeria but Abacha's death had opened cans of worms never imagined. The man who succeeded him, General Abubakar Abdulsalami had recovered about $770 million, mainly by insisting that Abacha's associates return purloined cash. He also confiscated and sold some of the Abacha family's most valuable estate. As the investigation picked up, Mohammed urgently asked to withdraw $39 million from citibank account in London. But the funds were in a time deposit that would not mature for two weeks: Citibank approved an overdraft without imposing a penalty and the funds were disbursed to three accounts.

Loot, Loot, Everywhere
The greed of the late dictator was almost insatiable. The Abacha family also used their position to buy back a $2 billion debt owed a Russian company that constructed the Ajaokuta Steel Complex for DM 300 million(N15.68billion). The company passed the debt back to the Federal Government for DM 2.2 billion. Delivering a judgment in which the Abacha family wanted to pay DM 300million as refund from Ajaokuta debt buy-back scam as "full and final settlement " for all monies looted, British judge, Lord Justice Rix had this for Mohammed Abacha: "He has clearly failed to disclose his assets, as required by the freezing orders, in large scale way. The $380 million frozen in Switzerland, with 232 million in the single account at Credit Suisse, all of this undisclosed in London highlights this point", Lord Rix said.

This was the situation when President Olusegun Obasanjo assumed office in 1999 and efforts were intensified to recover..

80 per cent of what is left of their liquid asset which presidency sources put conservatively at $2 billion. While Mohammed was still in detention awaiting conclusion of his trials, the lawyers of both the federal government and the Abacha family agreed to a deal in which the family will part with $1.5 billion.

With the payment of that amount, the Abacha family, presidency source said, will not only get relief from prosecution on all matters except criminal, it will be left with about $100 million in cash and $400 million in bond. Obasanjo actually fulfilled his part of the bargain but now the Abacha family is playing games.

Following the death of their patriarch, General Abacha, on June 8, 1998, the family have been under intense searchlights of the Nigerian authorities. It is believed that the former Head of State who ruled the country for five years, stashed about $4.5 billion away in legion foreign accounts.

The succeeding Abdulsalami administration was able to recover some of the landed local assets belonging to the family as well as freeze some of their accounts in local banks.

But the massive hunt by the Abdulsalami regime and the Obasanjo administration to recover the liquid assets of the Abachas in Europe, particularly London and Switzerrland and America has yielded little dividends owing to legal barriers.

The compromise option had earlier gained currency in the first stint of Mr. Agabi as Justice Minister. Before his portfolio was given to the now late Chief Bola Ige in 2000, it was gathered, Agabi had always favoured such a compromise arrangement, his argument being that protracted litigation would not only be financially exacting but also prove fruitless at the end of the day.

The money-for-pardon deal attractive was to the Obasanjo administration for two main reasons. One, it would afford the government an opportunity to halt once and for all the long-drawn legal fireworks which have proved very expensive. For, the government continues to spend fortune as legal charges to lawyers to sustain its battle against the Abachas in foreign courts.

Two, the government also considered the deal a political strategy to appeal to the local sentiments in Kano, the home of the Abachas where the Obasanjo administration has been experiencing relentless criticisms spearheaded by the one-time Governor of the old Kano State, Alhaji Abubakar Rimi. In what many Nigerians believed was too good to be a coincidence, the Supreme Court, in a ruling of four to one, ordered that Mohammed be discharged and acquitted to the murder charge. Ironically, the dissenting Justice described the ruling as tyranny of the majority.

The eventual release of Mohammed penultimate Monday was therefore based on certain conditions which include that he (Mohammed) sign an agreement to refund about $1.5 billion as part of the money believed to have been looted during his father's administration.

Also, Mohammed agreed to be under surveillance and not to travel out of the country without clearance from security operatives.

Presidential sources said the terms of the signed agreement were prepared by the lawyers of the Abacha family and those of the Federal Government.

The agreement was given to Alhaji Kaloma Alli, who in turn took it to the State Security Service (SSS) headquarters where he signed on behalf of the Abacha family while one Mr. Abubakar Mohammed signed for the Director General of the SSS.

The Agreement
The agreement was given to Alhaji Kaloma Alli, who in turn took it to the State Security Service (SSS) headquarters where he signed on behalf of the Abacha family while one Mr. Abubakar Mohammed signed for the Director General of the SSS.

In company of the Governor of Kano State, Alhaji Rabiu Musa Kwakwanso, his Deputy, Dr. Umar Ganduje, former Solid Mineral Minister, Ali, Alhaji Bashir Dalhatu, also a former minister of Mines and Power, Mohammed walked out of his SSS detention centre, Asokoro, Abuja at about 6.00 pm. Mohammed's release followed a visit to Aso Rock earlier in the day by some over 200 prominent indigenes of Kano State who were led by the state governor.

Aside from the Kano Governor, his deputy and members of the State Executive Council, other members of the delegation included members of the State House of Assembly, members of the House of Representatives from Kano, senators from the state, Ulammas, business and women communities from the state.

Speaking at Aso Rock, Kwankwaso had urged Obasanjo to show magnanimity and permit Mohammed's release in the spirit of reconciliation and as a way of dousing the tension arising from his case. Responding, Obasanjo asked the Kano delegation to go back to Kano and pressurise Mrs. Maryam Abacha to comply with the agreement earlier reached with the Federal Government to refund $1.5 billion dollars.

He said: "I want you to know that there was no malice whatsoever, no ill-feeling whatsoever on my part, only a desire to do what was right and what we can stand before God and man to defend.

"If you are talking of reconciliation, as a believer, I know that whatsoever we do, we must remember God. I am here today, we may not be here tomorrow. What matters is what happens to the people we leave behind.

"I believe very strongly that as I ask God for forgiveness, because I know that I am a sinner, I will readily forgive those who wrong me.

"I have no ill feeling whatsoever, no malice whatsoever, no bad idea whatsoever, against anybody and certainly not against the family of the Abachas.

"But we must be guided by fairness and justice. When you introduced Mohammed Abacha as our son, What do you think he is to me? He is my son too."

Obasanjo, however, restated the issues over which Mohammed had been standing trial.

He said: "But there are two issues, the issue of Rogers allegation against Mohammed. There is an issue of Sani Abacha family, including all members of the family, with Mohammed Abacha at the center of it all. And that is the stashing away of this country's money. Let me tell you what I have done, in case you don't know. My predecessor, General Abdulsalami Abubakar, and in fairness to him, he recovered $600million and 120 million British pounds.

"When we came in, we looked at things again, and we discovered that there are much more. I asked my Vice President to invite Mrs. Abacha as a wife of former Head of State. I asked him not to take her to the office, but to his home. But let her know that these things she is holding must be dislodged.

"Then Mrs. Abacha phoned me, for the first time, she said she did not know I could be generous and could treat her that way. She said she had always feared me.

"But I told her that we hear that they have two billion dollars. We went on and on and we discovered very close to $1.5billion.

"We hired lawyers and took them to five different places, Switzerland, Britain, Luxemburg, Spain and New Jersey (USA) for a long drawn legal battle.

"We got through their lawyers to say we will settle out of court. So, we have a legal document. So, our lawyers and their lawyers agreed. The document made me to forgo $100 million. I know they don't deserve it. Then another $400 million in bond on face value.

"The agreement was signed and sealed, but when it got to the time of exchange, they reneged.

"If only for the interest of the nation, nobody should perpetrate this kind of blatant corruption.

"Governor (Kwankwaso) you are making a special request, and nine other requests. I am also making a request, because the money belongs to all of us and should be disgorged. Because you will like to come back we will not let up until every kobo is recovered.

"I hold no malice, ill-feeling, only for us to do what you can stand before God and man as just."

The document containing the agreement was eventually handed over to Alli who prostrated to the president in appreciation, as Obasanjo said "If he signs he will be released to you and you can take him with you."

After the signing of the agreement at the SSS headquarters, Mohammed was released to Kwankwaso and his team. They all drove out in jubilant mood.

A Dirty Deal
But as things stand, the Abacha family seems prepared for a long -drawn legal battle while hoping that Obasanjo's government will be replaced by a more amenable one that may allow them to go away with the hundreds of billions of Naira belonging to the people of Nigeria.Family friend even told THISDAY that rather than part with the loot, it would serve the Abachas well to use part of the money to fund Obasanjo's opponents so as to make his re-election impossible.

Only recently Mrs. Maryam Abacha granted an interview to a magazine where she claimed the deal was a spoof. "There was no agreement between me and anybody. The lawyers are there. Go and ask them. They did not sign an agreement with anybody. There was no agreement. Our lawyer came here with this piece of paper. It was not an official letter head. There was no coat of arms or anything like that"

Mrs. Abacha claimed that the money the federal government was after belonged to the family "Ibrahim's monies are included too- and Mohammed too was doing business, his monies are there too. Now, they say they want all the monies".

In a defiant note, Mrs. Abacha had said; "we know there is a plot to destroy this family, the Abacha family. But insha Allah, it will not succeed. Abacha is dead, if they have anything against him, they should go there (pointing at the grave behind the house) and take him that is all. On Mohammed, we have accepted that he is a captive. It is now a kidnapping case and we have to pay a ransom. He is a captive in his our country. So let them tell us how much to pay for his release. At first, they said if there is a global agreement they will give us total freedom. I didn't know which one is global agreement....".

Even though Mrs. Abacha's posture ought to have been a signal of what to expect, the presidency, according to impeccable sources, had by them boxed itself into a corner because the court had set Mohammed free. From High Court to Supreme Court, there were judicial decisions that were reinforcing the family position. Incidentally, the federal government is believed to have used the court to effect Mohammed's release in the first place. This had become a serious embarrassment to the government aside the dangerous political backlash it had generated.

That was why the intervention of the Kano state government came at the right moment. But even at that Abacha family having secured Mohammed's release now says it has no deal with anybody and is unprepared to release a dime to the federal government.

The question asked now is; why did the federal government not collect the money from the family before Mohammed was released? The simple answer is that the young man might have outsmarted the president.

In one of his court appearances, Mohammed had said h e could not negotiate as a prisoner because only free men can negotiate That perhaps was the caveat he needed to secure the deals that led to his freedom. And now that he is free, he says he won't part with the money in the family till.

FG's Counter Moves
Apparently anticipating that Mohammed, would renege on his word to refund to government coffers about 80 per cent of looted funds in the Abacha family offshore account, the Federal Government has begun moves to confiscate more than $1 billion stolen by the Abacha family and already frozen by some European governments.

Consequently, the government has instructed its lawyers to seek the confiscation of the loot currently frozen in bank in four European countries. The effort has reached advanced stage in Switzerland.

The Federal Government had earlier got the banks located in Switzerland, Luxembourg, Liechtenstein and the United Kingdom, to freeze the various accounts the funds were lodged. The latest moves, according to a Financial Times report, was to get the banks to now hand over the money to the Federal Government. The report said the government had been in contact with the authorities of the UK and United States for help on this plan.

Apart from his denial of the existence a deal, the first indication was a story in the Financial Times quoting a Swiss lawyer, Enrico Monfrini, engaged by the Federal Government, as saying that: "The global settlement agreement has collapsed because Mohammed Abacha did not honour his word.

"The Nigerian government has instructed me to deliver a stronger than ever battle against the Abacha family and their associates, aiming to confiscate the money which we have frozen so far and find more money," said Monfrini.

President Obasanjo had shortly after taken power in May 1999 declared that over $4 billion was looted from the public treasury by the Abacha family and associates.

Since launching a manhunt to recover the loot, the government was able to freeze $30 million starched in UK banks. UK monetary regulators, the Financial Services Authority (FSA) however, said it discovered that 23 banks in the UK handled $1.3 billion of the transactions on behalf of the Abacha family between 1996 and 2000.

The government also in September 2001, won an order in a London High Court to freeze Abacha accounts in 19 banks. An estimated $650 million has also been frozen in bank accounts in Switzerland. Swiss authorities have now begun moves to hand over relevant financial documents to the Nigerian government to assist in launching court proceedings to confiscate the money.

Liechtenstein and Luxembourg authorities equally froze an estimated $350 million and $250 million respectively, of the looted fund.

The Federal Government is hoping that if it succeeds with the Swiss case, the Liechtenstein and Luxembourg authorities would follow suit.

The government had also requested UK to hand over to it, relevant financial documents gathered during investigation by the UK law enforcement agency, Serious Fraud Office, following tip off that the Abacha family might have started moving the looted funds from UK banks to other countries outside Europe.

An earlier out-of-court settlement provided for the Abacha family to keep $100 million of the looted funds. Mohammed had remained in detention even following other court judgments freeing him, in an apparent reaction by the government to the failure in keeping his side of the bargain. Police authorities said Mohammed, detained since late 1999, still had to answer to charges of theft and money laundering.

However, following the intervention of eminent personalities from Kano State, Mohammed regained freedom on Monday. Obasanjo who met with the delegation led by Governor Rabiu Kwankwanso, said Mohammed's freedom was based on two conditions. These were the refund of $1.5 billion of the looted fund and that Mohammed would remain under surveillance.

In a dramatic twist, however, Mohammed told reporters in Kano when he paid a visit to the Emir Ado Bayero, that he was released unconditionally. The Kano State Government had countered this position, however, confirming that Mohammed was made to sign a surveillance scheme with the State Security Service (SSS) stipulating that he would be confined to Kano.

A Long Search
Indeed, the hunt for the Abacha loot has been dogged. Not too long ago, accounts belonging to the family in nineteen banks in London were ordered frozen by the British court.

The Financial Times reported that the banks involved included Deutsche Bank, BNP Paribus, HSBC, Barclays, GoldmanSachs and Citibank.

The court action came six months after the FSA found that 23 London banks had handled 1.3 billion ($1.9 billion) on behalf of associates of the former Head of State.

The court order came as the international financial community tried to get to grips with the flows of clandestine money funding nefarious groups including terrorists.

Nigeria had for months been seeking British government help in getting to the bottom of the funds allegedly looted by Abacha.

The FT said it was lawyers acting for the Nigerian government who had obtained the court orders. The FSA would not confirm the information.

Mohammed, meanwhile is contesting a decision to allow bank accounts to be frozen so that supposedly stolen funds can be recovered. His legal challenge had been heard in a London court.

Abacha, who as Head of State from 1993 until his death in 1998, is accused in Nigeria of having diverted $3 billion of public money into secret accounts in Switzerland, principalities of Liechtenstein and Jersey as well as Luxembourg.

The governments of these countries were said to have frozen identified accounts of the Abacha family, in response to the plea of the Nigerian government, though the sums in the accounts were not disclosed.

Meanwhile, most of the banks named as having handled the Abacha funds were unwilling to comment on their involvement.

Barclays said only that it always co-operated fully with the authorities on issues of money-laundering.

HSBC, the London-based group, said it had strong anti-money laundering controls that were constantly reviewed. Last year it had introduced "special procedures for accounts held by public officials and other high-risk category clients."

Only Goldman Sachs, the US investment bank, was prepared to deny the involvement of its private banking arm: "It has no existing or past relationship with the Abacha family and consequently has asked to be removed from this action."

Some of the banks said their involvement was minor. Commerzbank, Germany's fourth-biggest bank, said its only role was as a correspondent bank for a Nigerian bank for which it handled a "bank-to-bank" transfer to Luxembourg.

In March 2000, the Federal Government won a 21 month legal tussle against the Abacha family over the attempt to stall further enquiry and repatriation to Nigeria of funds alleged to be looted and stashed in European banks.

In what observers claim was part of the stalling tactics of the Abacha family, lawyers acting for Mohammed and Alhaji Abubakar Bagudu, his business partner sought and obtained two applications from another British court challenging the decision of the British government to assist Nigeria in the bid to recover the looted funds.

The contention of the lawyers was that since the Abacha family had earlier repaid all monies traced to it through the Ajaokuta debt buy-back scheme, it would amount to double jeopardy to be subjected to further legal inquiries over Nigeria's request.

The Abacha family specifically accused the Federal Government of being reluctant to bring other suspected looters to book, claiming that it should be left alone since it had earlier refunded about $800 million after which it was reportedly granted a reprieve by government.

However, Justice Rix of the Commercial Court in Central London, who delivered the March 2000's ruling, said the payment of DM300 million (N15.58 billion) as refund from the Ajaokuta debt buy back scam as "full and final settlement" for the looted monies from Nigeria had been denied any "global waiver," stressing that it does not prevent the recovery of more money.

In arriving at the judgment, however, Rix berated Mr. Agabi, Mohammed, Bagudu and some top Federal Government functionaries for their role in the matter.

Rix, while commenting on Agabi's evidence about his role in negotiating the agreements, said it was "extremely hard to believe" and implied that the minister was used as an instrument by senior members of the defunct Abacha government.

Now that the Abacha family does not want to fulfill their part of the bargain, what can the federal government do? Can Mohammed be arrested again on the basis of the dirty deal? It is unlikely, given the political situation which has turned the family into a hero of sort. Now, the All Nigeria Peoples Party top politicians are wooing the family. Others may soon join if only because of the money in their possession. But can the Abacha family really sit on that money belonging to the people of Nigeria? Time will tell.

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