On Tuesday, a Federal High Court in Lagos blocked a Kogi State salary bailout account held by a new generation bank because of a N20 billion loan taken from the bank.
The injunction was issued by Justice Tijjani Garba Ringim pending the outcome of an investigation or potential prosecution by the Economic and Financial Crimes Commission (EFCC).
Ex-parte application under Section 44(2) of the Constitution and Section 34(1) of the EFCC Act was filed by the agency with the court.
Mr. A. O. Muhammed, the company’s lawyer, told the court that the injunction was required to safeguard the res and prevent further dissipation of the monies in the account.
Muhammed said in his application that the N20 billion loan was intended to supplement the state government’s wage payment and operating costs, but was instead maintained in an interest-bearing account with the bank.
He went on to say that rather than utilising the funds for the intended purpose, the Kogi State Government asked the bank to transfer the funds from the loan account to a fixed deposit account.
The bank has yet to submit any reliable proof to indicate that the facility is well guarded, according to the regulator.
Justice Ringim granted the plea, ordering the EFCC to publish the order in a national newspaper and submit a quarterly report to the court on the investigation’s progress.
The judge postponed the hearing to December 1st, in order to await the investigation report.
The EFCC presented its claims in a 13-paragraph affidavit filed in support of the ex-parte motion, which was attested to by a member of a team of investigators from the EFCC’s Chairman Monitoring Unit in Lagos.
The Commission obtained credible and direct intelligence, according to the paper, which led to the tracing of cash reasonably suspected to be proceeds of illicit acts held in the Kogi State Salary Bailout Account.
According to him, the Commission acted on the information and forwarded it to the Chairman Monitoring Unit, where it was established that on April 1, 2019, the management approved a N20 billion rescue loan facility for the Kogi State Government.