Wednesday, June 10, 2009

Accounting for recovered loot

THE effectiveness of the war against corruption does not involve merely the apprehension, trial and conviction of persons who have helped themselves to the public treasury. To be truly effective, the war must extend to the handling of assets surrendered or forfeited by suspects and convicts as a result of their unlawful acquisition. For, the deterrence effect is weakened if corrupt persons can, or know that they can, always retain all or a greater percentage of their loot. Indeed, the prevailing attitude seems to be for a potential felon to loot as much as he/she can, then appropriate a portion of the ill-gotten wealth to fend off prosecution on the one-hand, and to still have some of the loot to enjoy, on the other.

Sadly, while there has been some movement in the arrest, arraignment and conviction of some looters, there is a worrisome veil of secrecy over the handling of the loot recovered in the process. Two notorious cases readily come to mind. They involve the late Head of State, Gen. Sani Abacha, who fleeced the Nigerian nation of billions of dollars; and the case of the former Inspector General of Police, Tafa Balogun.

In the 11 years since his demise, there has been no satisfactory accounting for all the sums so far recovered from the loot salted away in various foreign currencies by the late Gen. Abacha. Recently, an official of the United Nations Office on Drugs and Crime disclosed that about $1.9 billion was recovered from the Abacha family from the nearly $3 billion stolen by the erstwhile military dictator. While the sum so far recovered is a major success story, Nigerians have never had the benefit of a full disclosure of the application of the recovered loot. This is in addition to the tragedy that up till now some $450 million of the Abacha loot cannot be traced. Furthermore, $300 million is yet to be repatriated to Nigeria from Luxembourg, together with another $400 million locked in accounts in Liechtenstein.

In 2005, the Economic and Financial Crimes Commission (EFCC) sensationally arraigned the former Inspector General of Police Balogun on a 70-count charge of stealing, money laundering and related offences. In a plea bargain, Balogun returned most of the N10 billion he was accused of stealing and laundering. Properties were also recovered from him, and then sold. But exactly how much was realised and where is the money? According to the EFCC spokesman, Mr. Femi Babafemi, "Nobody knows the exact properties recovered from Balogun. The Chairman of the EFCC, Mrs. Farida Waziri, raised this issue when she assumed office." Even more astonishing, says the EFCC spokesman, "Till date, we don't know the exact number of properties seized from the former IGP because there is no record for forfeited assets. We don't know how many properties were sold, who sold what and how much was recovered from the sale."

It is appalling that the EFCC is only just now establishing an asset forfeiture unit. That disclosure can only mean that while the fanfare was on with regard to the detention and trial of accused looters of the treasury and other money laundering offences, no one kept an eagle eye on the recovered loot. This is most unsatisfactory. Indeed, until last year when the incumbent Inspector General Mike Okiro requested for the release of the police insurance fund, which was part of the loot forfeited by his predecessor, there seemed to have been no focus at all on what was happening to the funds.

It mocks the anti-graft effort that the system has no proper method of tracking retrieved loot. But this has to be done. It must not be treated in the usual lackadaisical manner in which the matter is left untouched and then forgotten with the passage of time. Interestingly, the incumbent EFCC Chairman raised posers about the matter on assumption of office. We expect her to pursue vigorously a diligent audit of all forfeited assets since the EFCC was established. There is no question that if properties were seized and sold, the monies would be in some accounts and it is unthinkable that such accounts would not be interest-yielding.

Therefore, part of the outcome of the suggested audit must provide a composite figure of the principal sum and accrued interest. Where there are discrepancies, the EFCC certainly will be on to another case of graft, which it must pursue to its logical conclusion. But once a satisfactory accounting of the recovered loot has been undertaken, and the process should not last forever, the monies should be released for purposes that were originally intended - or appropriated for urgent needs. Thus, it is disheartening that while policemen remain poorly equipped and live in rat-holes that are called barracks, almost N10 billion purportedly recovered from the former Inspector-General of Police is sitting pretty in some accounts about which there is little public knowledge. Get the money out and apply it accordingly.