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How NASS probe threatens NDDC forensic audit

By Kelvin Ebiri (South South Bureau Chief), Nkechi Onyedika-Ugoeze, (Abuja) and Victor Gbonegun (Lagos)
26 July 2020   |   3:50 am
There are growing concerns that the outcome of the probe by the National Assembly (NASS) of the allegations of financial malfeasance in the Niger Delta Development Commission

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There are growing concerns that the outcome of the probe by the National Assembly (NASS) of the allegations of financial malfeasance in the Niger Delta Development Commission (NDDC) may impact the forensic audit of the agency ordered by President Muhammadu Buhari.

Even though the Presidency, on Friday, said Buhari would act decisively on the resolution of the legislature at the right time, stakeholders in the region are already expressing doubts about the capacity of the audit firm engaged to do a thorough job, especially with the allegation that high political office holders have their hands in the pie.

Consequently, the aggrieved stakeholders are calling on Buhari to engage globally renowned forensic auditing firms to carry out the exercise. They alleged that since the Procurement Act was abused in the process leading to the emergence of the engaged firm, there is the tendency that the outcome of the audit may be compromised.

In the midst of this, groups including Youth in Africa Anti-Corruption Network (YIAA Network), and the Young African Leaders Initiative (YALI Network) have called for the immediate removal and prosecution of the Minister of Niger Delta Affairs, Godswill Obot Akpabio, the acting managing director of the NDDC, Prof. Kemebradikumo Pondei; Commissioners and everyone, who in one way or the other, is allegedly involved in the grand corruption taking place at the agency.

The groups also insisted that the erstwhile managing director of the commission, Dr. Joi Nunieh, should be properly investigated by the Code of Conduct Bureau, while the National Assembly should re-invite Pondei for a full investigation.

They, however, urged the National Assembly to resist the temptation of discharging Pondei from further investigation and interrogation, alleging that failure to reschedule Pondei’s interrogation means the lawmakers were conspiring to cover up allegations made against some of its members by Akpabio.

THE Coordinator, National Coalition on Gas Flaring and Oil Spills in the Niger Delta (NACGOND), Dr. Edward Obi, while weighing in on the N81b saga said as the NDDC continues to face credibility crisis, Buhari should immediately engage reputable forensic auditors to audit its finances and projects.

Obi, who said it was illegal to award the auditing contract without due process, stressed that Nigerians should be brought into the discourse as far as the choice of a transparent, reputable auditing firm with international pedigree is concerned to unravel the true state of the alleged malfeasance.

“I stand to be corrected, the NDDC is not all about making Niger Deltans rich; it is not about giving jobs to Niger Deltans; It is about creating opportunities for Niger Deltans to take advantage of what is available to them. So, I don’t believe that giving jobs to Niger Deltans is what NDDC is for, No. If that agency had done what it ought to have done, by now there would have been a multiplicity of opportunities for Niger Deltans and other Nigerians to make business by themselves.”
IN the same vein, a business mogul and 2019 Action Democratic Party (ADP) governorship candidate in Rivers State, Mr. Victor Fingesi, described the scandal rocking the agency as an embarrassment to the country, insisting that concerted efforts must be made through an independent forensic audit that will unmask diverters and plunders of development funds through the NDDC.

“It is time to bring in an international auditor, KPMG, and some of those firms that have international repute to immediately audit the NDDC, and thereafter advise the Federal Government on what to do about the looted funds. If you are given a contract and you don’t execute it, you should bring back the money.

“Auditing firms in the country have been auditing too many agencies; too many companies, that they all now have friends everywhere. With what is going on today in the NDDC, people can reach people. So, for a thorough, I think we have to bring in an independent auditor that does not operate here. I named one, KPMG,” he said.

THE former board chairman of the Nigeria Extractive Industries Transparency Initiatives (NEITI), Ledum Mitee, wondered why the Federal Government failed to engage NEITI, which has the statutory responsibility to audit, track revenues from oil to probe the NDDC.

He explained that NEITI in its Fiscal Allocation and Statutory Disbursement 2007-2011, and 2012-2016 audited reports, revealed a lack of accountability and transparency in the financial activities of the NDDC.

“With just half of the money that they are spending on forensic audit, NEITI can do a very thorough job on the NDDC. The whole process of the NEITI audit is not easy to compromise. Mind you, it involves multi-stakeholders as people from the oil companies are there; civil society groups are there, as well as government agencies. But, why do you pay as much as N1b to an auditing firm, that will be superintended over by those already in the eye of the storm, and who have already been indicted? How would Akpabio sit over that? How would the IMC superintend over such an audit…?”

Mitee pointed out that for every hour the National Assembly spends questioning NDDC officials’ financial recklessness, somebody in the Niger Delta is dying from either preventable diseases like malaria or the contaminated water that they are drinking.
THE National Vice President, Trade Union Congress, Chika Onuegbu, who is an economist cum chartered accountant, said given the level of fraud and irregularities that have taken place in the NDDC, an independent forensic audit, which goes beyond the mere presentation of invoices, names of companies, or certificate of work completed, to unravelling who did what job, and on the spot assessment of jobs awarded and paid for, is needed.

“Payments from banks have to be traced, not just to those companies, but the ultimate beneficiaries. That is why the support of the Central Bank of Nigeria is required. If N10m was paid to YWZ Ltd, who are those authorised to withdraw the money? Who has the BVN? Companies are legal entities, but of course, companies are not human beings, it is human beings that run them. The CBN should avail information and support to the forensic audit so that the final account where the monies ended up would be unveiled,” he said.

Onuegbu described the NDDC as a playground of many corrupt people, including members of the National Assembly, who are deeply concerned about the forensic audit, as opposed to the normal audit.

“Let the forensic audit go on, let the report of that forensic audit be made public, and let whoever feels aggrieved write a petition for another audit firm to come and check. But let us not scuttle the forensic audit. All of us that are from the Niger Delta know that the NDDC is a colossal failure and the epicentre of fraud in Nigeria.

“The forensic audit is not the solution to the problem of NDDC. It is just a process of unearthing the massive corruption that has taken place in the place. After that, there is a need to review the NDDC Act, either the NDDC is scrapped and the fund channelled to oil-producing communities,” he said.

UCHE Onyeagucha, a former Secretary to the Imo State Government described the NDDC as a filthy institution to the extent that with or without a forensic audit if Nigerians don’t change their attitude towards corruption, not much would be achieved.

“There should be a total, comprehensive audit of every person in the NDDC. And then you can still feel free to investigate all the properties and assets of all the persons, who have served there from the beginning to date. You should also go back and investigate the property and assets of all those who have been members of the NDDC Committee of the House of Representatives, all the NDDC Committee of the Senate, from the beginning to date. Where their property, assets, and bank accounts fail to match their income, they should be made to explain. That is how you will do the cleansing, which has to be comprehensive” he said.

MEANWHILE, the Global President, Association of Forensic Accounting Researchers (AFAR), Prof. Godwin Emmanuel Oyedokun has lauded the forensic audit but faulted the process that brought up the exercise.

He said: “The only thing that I have a problem with is the process that brought that forensic process up. A forensic audit is necessary and good, but who initiated it? Is it a group or the NDDC office that initiated it, and do they have the power to do so? If there is a problem from the beginning, the process can’t be legal. The Federal Government doesn’t have the power to initiate it. The Federal Government through the management of NDDC should have been the one to do so.”

Oyedokun who is also the President, Association of Certified Fraud Examiners (ACFE), Lagos Chapter, explained that forensic audit is a procurement issue and when carrying out procuring services, it should be the responsibility of the NDDC.

“The Federal Government can mandate the directorate of NDDC to do so. That was the reason that the National Assembly argued that the minister was usurping the powers of the NDDC board to initiate the contract because the forensic audit is also a contract.”

Contrary to calls by some groups in the Niger Delta that an indigenous forensic firm mustn’t be allowed to carry out the probe, he said it’s an abuse of freedom of speech to say that indigenous auditing firms shouldn’t be involved in carrying out the forensic audit of the NDDC.

For those canvassing for foreign audit firms, he asked: “Are they also ridiculing their professionals and saying that we should go and hire somebody from the United Kingdom to come and do the audit? Would such people know the terrain of Nigeria more than the indigenous experts? It is a misuse of freedom of speech.”

He further said that accounting firms like, KPMG, Deloitte, and PwCs are not foreign audit firms, they are still Nigerian companies only that they are using the network names across the world.

“If a Nigerian joins a network of audit firms, he is still a Nigerian. With international qualifications, you can’t work as an accountant in Nigeria. The Chairman of Deloitte in Nigeria, for example, is a Nigerian and would lead a team of Nigerians and Nigerian facilities to carry out a forensic audit. There is a difference between conventional auditor and forensic auditors. Once the people that selected Olumuyiwa Bashiru & Co., can confirm that the so-called firm has partners that have been trained in forensic auditing, with evidence, then so be it. It must be noted that forensic report is quite different from auditor’s report,” he said.

THE past president, Institute of Chartered Accountants of Nigeria (ICAN), Alhaji Rasaq Jaiyeola told The Guardian that Nigeria’s accounting firms have many professionals that can carry out thorough forensic auditing of the NDDC.

He explained that the institute started training members on forensic audits over 10 years ago, stressing that before then, many of its members have been practising internationally.

“We have national firms that are well-grounded in forensic auditing. We have many capable hands with international affiliations. So, I don’t see any big deal in forensic auditing that ICAN members cannot do. As long as they are ICAN members, they should be able to perform,” he said.

According to him, ICAN founded the Audit, Investigations and Forensic Accounting Faculty in the year 2009 and started its certification programme in forensic accounting in 2011.

“As at December 2014, ICAN had trained and inducted 382 members as Certified Forensic Accountant of Nigeria,” he said.

SPEAKING on behalf of the groups calling for the removal and prosecution of Akpabio and Pondei in Abuja, the President of YIAA Network, Ovo Emokiniovo Otarigho said: “We are dismayed with the accusations and counter-accusations between Senator Akpabio and the erstwhile Managing Director of the commission, Dr. Joi Nunieh, as well as the shameful drama presented by Prof. Pondei. We demand that the people entrusted with the responsibilities of our commonwealth should face justice and be accountable to the citizens, and not to serve themselves. On account of that, we vehemently reject the statement of the Speaker of The House of Representatives, that Prof. Pondei might be excluded from further interrogation. We, therefore, call on him and members of the committee to re-schedule another day for the continuation of the investigation of Prof. Pondei on account of his stewardship. We shall view the failure to reschedule his investigation as an act of complicity on the part of the National Assembly over allegations made by Senator Akpabio.”

“Furthermore, we call on the National Assembly to expose all its members alleged to have been involved in this grand-scale scam to defraud the people of the Niger Delta of their rights to experience development through the NDDC. In the bid to unravel the truth, all witnesses in this investigation must be protected. We, hereby call on the Inspector General of Police to live up to the essence of his duties, which is to protect the lives of the citizens. All attempt by alleged conspirators in this corruption to threaten witnesses to thwart the truth must be discouraged and resisted by the Police.”