N76bn Fraud Trial: AMCON Ex-Director Recants, Says Arik’s N85bn Debt Was Non-Performing

Wale Igbintade

A former Executive Director of Asset Management Corporation of Nigeria (AMCON), Muhammed Abbas Jega, yesterday told a Lagos State Special Offences Court that Arik Air’s N85 billion debt, acquired by AMCON, was non-performing at the time of his exit from the corporation in 2015.

Jega, who served as Executive Director, Credits, made the disclosure while testifying as the third prosecution witness (PW3) in the ongoing trial of former AMCON Managing Director, Mallam Ahmed Kuru, and four others, over an alleged N76 billion and $31.5 million fraud.

The defendants — Kuru; Capt. Roy Ilegbodu, Managing Director of Arik Air; Kamilu Omokide, Receiver Manager of Arik; Union Bank of Nigeria Plc; and Super Bravo Limited — are facing a six-count charge bordering on conspiracy, stealing, and abuse of office.

Under further cross-examination, Jega retracted his earlier testimony that Arik’s loan was performing at the time of purchase under the Eligible Bank Assets (EBA) programme.

He clarified that the loan, originally acquired from Union Bank and Bank PHB, was in fact already non-performing when AMCON took it over.

He revealed that AMCON acquired Arik’s loan portfolio to the tune of N85 billion and subsequently provided an additional N11 billion as working capital to support the airline.

“Despite the significant funds injected by AMCON and the intervention funds from the Bank of Industry, which AMCON also guaranteed. Arik could not meet its repayment obligations until my departure in 2015,” he said.

Jega added that although he carried out all transactions with the approval of AMCON’s Board, he never saw the Loan Purchase Agreement detailing the full credit structure of the Arik loan, especially those acquired from Union Bank.

He claimed that AMCON was misled in the transaction, saying “It was after the so-called London meeting between the obligor and AMCON’s executive management that it became clear there were underlying issues with the purchase.”

However, Jega admitted he neither raised the red flag to AMCON’s Board nor escalated the issue to the Central Bank of Nigeria.