FMBN under fire

For squandering N14.2bn on unexecuted 963 units of homes, the Federal Mortgage Bank of Nigeria is under fire.

The Nigerian Senate Committee on Public Accounts insists that the money be recovered and appropriate punishment meted out to offenders.

Led by Senator Mathew Urhoghide, the panel was reacting to the 2018 report of the Auditor General of the Federation, which alleged that though N14.2bn was paid for the N10bn contract, no tangible work was done on the project before its abandonment.

The AuGF’s query, sighted showed that the contract sum was inflated by N4.2bn, with the entire contract sum of N14.2bn disbursed to the contractor between November 22, 2012 and April 29, 2013, adding that the overpayment notwithstanding, less than 10 per cent of work was done.

“Audit observed that the bank awarded a contract for the construction of 963 units of residential building called Legacy Estate, with all the facilities and services of a modern urban setting at a contract price of N10bn. However, a total of N14,281,749,370.71 was disbursed to the contractor between November 22, 2012 and April 29, 2013, thereby resulting in an overpayment of N 4,281,749,370.71. No reason was provided for the additional payment, neither was any evidence of contract variation presented for audit.

“Audit further observed, from physical inspection of the site on July 7, 2017, that the project had been abandoned since 2014, some months after payments were made, with less than 10 per cent of work done,” the query read in part.

But FMBN’s Managing Director, Ahmed Dangiwa, explained, “The contract has been investigated by the present management in an effort to recover the bank’s fund, as all stakeholders were consulted to assist in investigation and recovery.

“Our report has been sent to the Minister of Works, Power and Housing, as well as the board, which later directed us to send it to the Department of State Services, Economic and Financial Crimes Commission, Independent Corrupt Practices and other related Offences Commission, and the Special Presidential Investigation Panel for Recovery of Public Property.”

He added that the EFCC and ICPC were to assist in investigating the loss of funds on the Goodluck Jonathan Legacy Estate project to enable the FMBN recover its money.

His words, “The then SPIP was also to investigate and recover N11bn from the developer, Messr Good Earth Power Nigeria Limited. Nord Consult was engaged to file an action for the recovery of the fund guaranteed by GTBank on the advance payment guarantee it issued, for which the bank appointed Intel Cost Associate Limited to carry out the current valuation of the project in order to serve as expert witness in the suit against GTBank.

“This management also initiated a valuation of the development on site by an external consultant and the total work done, comprising housing units and infrastructure work valued at N940m.”