NGF Warns Finance Ministry Not To Pay Firms Claiming N105billions From LGA Allocations - EazyFeeds

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Tuesday 20 April 2021

NGF Warns Finance Ministry Not To Pay Firms Claiming N105billions From LGA Allocations

 The Nigeria Governors’ Forum has written to the Federal Ministry of Finance, Budget and National Planning not to pay Local Government Councils’ funds to the tune of over N105 billion being claimed by some firms as legal and consultancy fees.

The NGF warned in a letter on Monday, which was obtained by SaharaReporters, that the matter was to be determined in court and the finance ministry should stay action on the payment because of the negative financial implications it would have on the 774 LGAs nationwide.

The NGF, through its counsel, human rights lawyer and Senior Advocate of Nigeria, Femi Falana, stated in the letter, titled, “Re: Issuance Of Promissory Note to Dr Ted Iseghoni Edwards” that the ministry should stay action “on this matter in view of the injunctive reliefs sought in the processes to be filed in court on these matters.”

The letter was copied to the Attorney-General of the Federation and Minister of Justice and the Director-General, Debt Management Office.

The NGF counsel, Falana, wrote, “The Nigeria Governors’ Forum has engaged our services to challenge the decisions of the court relating to or connected with payments of legal and consultancy fees arising from London Club Debt Buy Back Exit Payment which is the fulcrum of the judgment of the Federal High Court, Abuja in Suit No, FHC/ABJ/CS/130/13 – Linas International Limited and Ors Vs the Federal Government of Nigeria and Ors.

“As you already know the claim of Dr Ted Iseghoni Edwards arose from legal services he allegedly rendered to the Association of Local Governments of Nigeria. Consequently, we have prepared to all the court processes challenging the judgments of courts and seeking for stay of execution and/or injunction pending appeal, we have been unable to file due to the ongoing strike by the Judiciary Staff Union of Nigeria, which has occasioned a complete shutdown of our courts.

“Our attention has been drawn to a letter from the firm of Ikechukwu Ezechukwu (SAN) and dated April 8, 2021, urging you to issue promissory notes to Dr Ted Iseghoni Edwards. We respectfully urge you not to accede to the request because these promissory notes are to be deducted from the accounts of the states for the next 10 years. It is therefore expedient to await the outcome of the legal steps being taken by the states as presented by the NGF.

“Section 162(5) of the 1999 Constitution of the Federal Republic of Nigeria (as amended) mandates any amount standing to the credit of local governments to be paid directly to the states for the benefit of their local government councils. The states therefore have a responsibility to ensure that funds standing for the credit of the local government councils are protected as custodians of such funds. We need to inform you of your sacred duty of staying action on this matter in view of the injunctive reliefs sought in the processes to be filed in court on these matters.”

SaharaReporters on Sunday reported how the Association of Local Government of Nigeria also raised a petition to President Muhammadu Buhari revealing how the firms want to enforce the deductions of more than N105 billion from the allocations meant for the 774 local government areas from the Federal Ministry of Finance, Budget and National Planning.

The petition obtained by SaharaReporters on Saturday was titled, “Petition Against Fraudulent Attempts by Riok Nigeria Limited To Obtain $143 million or N54 million and by Dr Ted Edwards Isegohi To Obtain $159 million from the Allocations of all 774 LGAs in Nigeria.”

ALGON had alleged that some firms, including Ted Edwards Isegohi's, against a court order, are making a “fraudulent claim of $159 million” from the 774 LGA allocations.

The firm claimed it worked for local government councils, in getting refunds of first line charge/Paris Club.

In the petition dated March 29, ALGON lamented that some of the worst hit LGAs in the deductions are Ika North Local Government Area, Delta State, Ngor Okpala Local Government Area, Imo State and Lafia Local Government Area Nasarawa State.

The petition explained that the matter dated back to 2014 when a member of ALGON Board entered into a memorandum of understanding (“MOU”) with another firm, Riok Nigeria Limited, (“the company”) for the provision of boreholes among others in all the 774 local government areas and area councils of Nigeria.

SaharaReporters gathered that while the company seeks to recover the sum of $143.4 million or N54.5 billion which they alleged to be due under the memorandum, ALGON is claiming that there is no evidence that the company built or even commenced any construction of borehole in any of the 774 LGAs.

Also, ALGON in the petition explained that Ted Edwards also claimed to have provided legal services in a court suit FHC/ABJ/CS/130/13 and that by virtue of an instruction letter from ALGON, he is entitled to 10 per cent of the judgment payments; which is $318 million. 

ALGON, however, disputed that in a ruling delivered on the 27th of June, 2016, the Federal High Court castigated Ted Edwards for attempting to smuggle his claim for $318 million into the Garnishee proceedings in the Linas judgment because it said Ted Edwards was never part of those proceedings. 

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