Besides, there were indications that another former Chief of Army Staff and some ex-military officers might be arraigned in court for alleged corrupt practices relating to “phoney” arms contracts.
The legal unit of the EFCC is fine-tuning charges against the suspects.
But a status report on Gen. Minimah, who was the Army Chief from January 2014 to July 2015, indicates that he has returned some cash to the EFCC.
The refund followed extensive investigation by the anti-graft agency on the report and recommendations of the Presidential Committee on Audit of Defence Equipment Procurement (CADEP).
CADEP had uncovered “irregularities” in the procurement and award of contracts in the Army and suspicious transactions in the accounts of the Defence Industry Corporation of Nigeria (DICON) during Gen. Minimah’s tenure.
A top source, who spoke in confidence, said: “We have interrogated Gen. Minimah and he has started refunding some funds. So far, he has refunded about N1.7billion in two tranches to the EFCC.
“So far, he has cooperated with us and we are hopeful that he will still make more refunds, in line with some contracts awarded by the Army.
“But we are likely to arraign another Chief of Army Staff and some ex-military officers in court soon following the conclusion of a comprehensive investigation on them. We are expecting relevant advice from our legal unit.”
The CADEP panel had observed that a company was registered on November 17, 2014 and awarded $125,179,299.10 on the same day.
The report said in part: “ “The Nigerian Army, between April and August 2014, entered into four contract agreements with Societe D’Equipmenteux Internationale (SEI Nig Ltd) for procurement of Cobra Armoured Personnel Carriers, Shilka Self-Propelled Artillery Guns, Armoured Fighting Vehicles (AFVs) as well as various ammunition and spares funded by the ONSA.
“The contracts for the Cobra APCs and Shilka Guns were not executed as they were not funded. However, the costs for procurement of the AFVs; ammunition and spares were $398,550,000.00 and $484,765,000.00 respectively totalling $883,315,000.00.
“In November 2014, the ONSA awarded contract to Conella Services Limited for procurement of 72 various arms and ammunition that included MRAP vehicles and Mi-17 helicopter at the cost of $125,179,299.10.
“The Committee observed that the company was registered in Nigeria on 17 November 2014 and awarded the contract on the same date while the EUC for the procurement was issued a day later, on 18 November 2014. Furthermore, the ONSA paid $36,996,530.00 and N2,209,582,296.00 to the vendor between November 2014 and 15 April 2015. However, the Nigerian Army denied receipt of any procurement from Conella Services Ltd.
“Similarly, the Committee tried in vain to reach officials of the company to confirm execution of the contract. There is, therefore, the need for further investigation of Conella Services Ltd.
“The committee observed that SEI and its two associated companies, APC Axial Ltd and HK-Sawki Nig Ltd, were incorporated in May 2014 with two Nigerien brothers, Hima Aboubakar and Ousmane Hima Massy, as the only directors.
“ Between May 2014 and March 2015, the ONSA mandated CBN to release various sums totalling $386,954,000.00 to SEI and the two associated companies for ‘procurement of technical equipment’, without tying the money to particular items of procurement.
“Thus, the allotment of the fund was left at the discretion of the vendor without input or
consultation with ONSA or the Nigerian Army.
“Furthermore, some of the funds transferred preceded the formalisation of SEI contracts with the Nigerian Army. There was also no evidence of any contract to justify the payments made by ONSA to the SEI associate companies.
Consequently, it had been difficult for the ONSA, the Nigerian Army and SEI to reconcile the accounts vis-a-vis the equipment delivered.”
The panel also uncovered that 42 units of Armoured Personnel Carrier(APC) which were rejected by Iraq were later sold to Nigeria to fight Boko Haram insurgents.
It claimed that some of the APCs were either expired or unsuitable, leading to loss of lives.
It added: “The Committee observed that one of the new equipment SEI procured for the Nigerian Army from Ukraine was BTR-4E APC.
“However, according to the Ukraine’s State Enterprise Lviv Armour Repair Plant, the designers of the equipment, some of the products sold to Nigeria in 2014 were actually among 42 units designed for Iraq which subsequently rejected them due to poor performance rating.”
“The Nigerian Army did not also undertake the mandatory pre-shipment inspections provided for in the contract agreements. Instead, the NA deployed an Infantry officer, who lacked the technical knowledge to assess the capabilities and shortcomings of the equipment, to oversee the shipment of the items for the Nigerian Army from Ukraine.
“Additionally, the two weeks training availed the technicians and operators was inadequate for them to comprehend the technical workings of the newly introduced equipment.
“The Committee’s interactions with the field operators revealed that although the platforms and ammunition procured by SEI were deployed for the NE operations, some of them were aged or expired, lacked spares and prone to breakdown without immediate recovery equipment.
“Therefore, failure to carry out pre-shipment inspection and inadequate training resulted in procurement of some unreliable equipment that reduced the capacity of the Nigerian Army in the North East Operations and resulted in the loss of lives and equipment.”
On some payments to SEI on T-72 Tanks, the panel said the company made about $93,000,000.00 profit without paying the mandatory 5 per cent Withholding Tax(WHT).
It said: “SEI submitted a document to the Committee reconciling the items it delivered to the Nigerian Army vis-a-vis the payments made to it by ONSA.”
According to SEI, the total value of the contracts it executed amounted to $909,065,824.00 and not the $883,315,000.00 reflected in the two contract agreements it signed with Nigerian Army. “Furthermore, SEI claimed that it delivered goods worth $697,718,168.00 whereas only $198,289,672.00 was paid to it by ONSA.
“However, the Committee established from ONSA payment mandates to CBN that $386,954,000.00 were actually paid to the contractor.
“Additionally, SEI quoted the unit cost of refurbished T-72 Main Battle Tanks as $2,240,000.00. However, the Committee confirmed from court documents filed by SEI against one of its vendors, Dolarian Capital Inc of the US, that SEI paid only $85,000.00 for a unit of the T-72 tanks.
“ Thus, from the refurbished T-72 Tanks transaction alone, SEI would have made a profit of about $93,000,000.00 for the 43 units it delivered to the Nigerian Army. Moreover, there was no evidence that SEI paid the mandatory 5% WHT.”
On suspicious transactions in DICON’s accounts, the CADEP report also implicated Gen. Minimah.
It added: The Nigerian Army awarded seven contracts to DICON for the procurement of Igirigi and Spartan APCs , arms and ammunition amounting to N4, 329’985, 000.
“The committee discovered that suspicious transactions to the tune of N845,600,000 and $3,450,619 were made from DICON’s domiciliary and Naira accounts with Fidelity Bank accounts 5250020197 and 5030040885. Out of this amount, the then DG DICON, Maj.-Gen. E.R, Chioba (retd) personally withdrew N81m and $131,740 in cash from the accounts. The sums of N764,600,00 and $3,318,879.17 were also transferred to the accounts of Lava Trade , 7×7 Limited and Oranto Petroleum Limited.
“The explanations offered by Gen. Chioba that the transfers were payments for services and foreign exchange were unconvincing as there was no evidence if formal business relationship between DICON and these companies.
“Consequently, the committee opines that the poor procurement process associated with DICON contracts contravened financial regulations, encouraged illegal withdrawals leading to wastage of public funds, diminished the capacity of the Nigerian Army in the campaign against terror and served as a conduit for misappropriation of entrusted funds.
“The committee is of the view that Lt. Gen. A. O. Ihejirika, Lt.-Gen. KTJ Minimah (retd), Maj.-Gen. A.I Muraina(retd), Maj.-Gen. U. Buzugbe (retd) and Maj.-Gen. E.R. Chioba(retd) are to be held accountable.”
“The Committee also noted that between 3 September 2014 and 30 April 2015,
NIMASA funded accounts of the Joint Task Force Operation Pulo Shield with various
sums totalling N8,542,586,798.58 purportedly to enhance operations of the Joint Task Force in the Niger Delta. Neither the need assessment that warranted the release of funds nor the details of the expenditure were made available to the Committee.
“However, analyses of the accounts of the Joint Task Force showed that transfers totalling N6,277,698,885.13 were made to some companies for unknown purposes.
A source in Oranto Petroleum Limited said it never had any business link with the Army either during Gen. Ihejirika’s tenure or his successor Gen. Minimah’s.
The source said: “Oranto Petroleum Limited did not receive any funds from the Nigerian Army under any guise between 2013 and 2015.”