Senate: Probing into MTN’s Fund Repatriation Controversy


The controversy surrounding an alleged illegal fund repatriation by telecommunications giant, MTN, has raged for some time, and now the Senate has launched a probe into the matter. Omololu Ogunmade looks at the investigative process

The last is yet to be heard on the battle of wits between MTN, Minister of Trade and Industry, Dr. Okechukwu Enelamah, and four commercial banks, on the one hand, and the Senate, on the other, over alleged illegal repatriation of N13.9 billion by MTN between 2006 and 2016 with the suspected connivance of Enelamah and the banks.

The allegation is being investigated by the Senate Committee on Banking, Insurance and Other Financial Institutions. At the commencement of investigative hearing on the matter in the National Assembly on Thursday, shock and disbelief enveloped the atmosphere. Indications that the event might be full of mysteries began when from the outset, a scene was created at the venue of the hearing between the Chairman of the Senate Committee on Banking, Insurance and Other Financial Institutions, Senator Rafiu Ibrahim and the minister, Enelamah. Such scene is usually uncommon in the meeting rooms of the apex legislative institution.

Drama started when the minister who had arrived at National Assembly at the the nick of time suddenly sought the permission of the committee chairman to take his exit from the hearing room to enable him attend to other state functions. But the chairman declined the request, insisting that the minister should wait to make his presentation to the committee.

The chairman’s instruction did not go down well with Enelamah as he opted to defy the instruction and left irrespective of the feelings of the chairman and his committee members. However, the chairman and the committee were hurt by his exit as they saw it as nothing but insolence and disrespect to constituted authority.

To underscore the depth of the committee’s grievances over Enelamah’s action, Ibrahim urged the Chairman of MTN, Mr. Pascal Dozie, to educate Enelamah on how to behave as he warned the minister against getting on Senate’s nerves. According to Ibrahim, if the minister had thought that he could dare the Senate, the parliament would be left with no option than to invoke its constitutional power to compel the minister to behave appropriately.

“We want you to advise him. For him to tell us that he couldn’t wait, I think he was being audacious against the Senate. We as senators expect him to engage the Senate in a more civilised way or else, we ‘ll be forced to invoke our powers,” Ibrahim threatened.
Expectedly, Enelamah’s action has generated reactions in the public as some individuals said Enelamah should have priced his image which was at stake as a result of allegation of fraud against him in connivance with MTN above other state engagements. This comment was made against the background of beliefs that the allegation had created a measure of credibility crisis for him and hence, he should have embraced the opportunity of the hearing to clear his name by stating his own side of the story as against opting for another engagement.

There were some other perceptions that it was not good for the image of the minister to be threatened by the committee, noting that as a minister, he’s a statesman in his own right and should have seen shelving other important engagements as some of the sacrifices of leadership.

However, the minister has risen in defence of his action, explaining that he never had any intention to demonstrate any measure of disrespect to the senators but for circumstances beyond his control.
A statement by Director of Press at the Ministry of Trade and Investment, Greene Anosike, gave reasons for his action. He said: “hearing did not start on time. Minister Okechukwu Enelamah offered to give his statement first, it was declined. He had to leave because of urgent matters of national importance.”

Another aide to the minister who did not want to be named said the minister’s engagement on Thursday and the depth of their importance left him without option than to leave. According to her, the hearing was scheduled to start at 12 noon and the minister had thought that the initial schedule was okay but because it did not start on time, other engagements were being affected. She however, said the minister was a gentleman and it was not in his character to be rude as his exit was being portrayed adding that the minister was open to another schedule.

According to Anosike’s statement, the minister was not involved in any wrong doing on the allegation of repatriation of funds by MTN.
“Dr. Enelamah served as CEO of Capital Alliance Nigeria Ltd. (CANL) between 1998 and 2015. CANL is a wholly owned subsidiary of African Captial Alliance (ACA), an Africa focused private equity firm with investments in carefully selected companies within and outside Nigeria, including MTN Nigeria

“A fund managed by ACA, alongside other minority shareholders, invested in MTN Nigeria through Celtelecom. Dr. Enelamah was never the “owner” of Celtelecom, neither was he ever a Celtelecom shareholder. Instead, he was a director of the company representing the ACA Managed fund.

“Investors do not have responsibility for remittance of proceeds from the company they investe in. Therefore, at no time was Dr. Enelamah in a position to transfer funds out of Nigeria on behalf of MTN Nigeria, and at no time did Dr. Enelamah transfer any funds out of Nigeria on behalf of MTN Nigeria. As it relates to Celtelecom’s investment in MTN Nigeria, it is important to note that the entire process for applying for and using Certificate of Capital Importation (CCIs) was done by MTN Nigeria,” the statement added.
However, as beautiful as the defence might be, the committee believed that Enelamah should himself tell the committee all he knew about the transaction instead of defending himself from a distance.

However, at the commencement of investigative hearing into the alleged illegal repatriation of $13.9 billion out of the country by MTN yesterday, the company told the Senate Committee on Banks, Insurance and Other Financial Institutions, that circumstances compelled it to move funds without observing the law.
The Senate had on September 27, 2016 alleged that MTN in connivance with Enelamah, and four commercial banks exploited the porous Nigerian financial system to move the money out of the country without the required authorisation.

The parliament, according to a motion moved by Senator Dino Melaye (Kogi West) on September 27, alleged that MTN smartly beat Nigeria’s financial regulatory laws by failing to obtain certificates of capital importation (CCI) as authorised by CBN Financial and Miscellaneous Act within 24 hours between 2006 and 2016 before moving the money out of the country.
It further alleged that the repatriation was done through four banks, viz: Standard Chartered Bank, Stanbic IBTC, Diamond Bank and Citi Bank.

MTN’s Position
However, the Chief Executive Officer (CEO) of MTN, Fedi Moolman, admitted that the company moved funds without complying with the 24-hour order for the issuance of CCI, saying it was practically impossible to do so.
Nevertheless, he stated that the action was taken without any deliberate intention to flout Nigerian laws but was rather compelled to do so because of circumstances which he said made it impossible for it to observe the 24-hour provision in the Act for issuance of CCI.

He said: “There was no intention to flout the rule and regulation. The 24-hour rule is not in all cases practicable and it is almost impossible to comply with,” Moolman said.
The CEO further told the committee that MTN faced acute challenges when it got to Nigeria in 2000 as it found that necessary facilities for business transactions were not available, a situation he said compelled it to import equipment to Nigeria.

He, however, attempted to justify his claim that MTN meant well for Nigeria through his submissions that MTN solely contributed 3.4 per cent of Nigeria’s gross domestic product (GDP) in the first quarter of 2006 and had since its advent in Nigeria employed 500,000 Nigerians directly and indirectly.

He also claimed that besides generating 80 per cent of the electricity it uses, MTN had committed N16 billion to various projects in Nigeria through its MTN Foundation and paid N1.6 trillion tax in 14 years. He further claimed that funds moved out of Nigeria were MTN’s dividends done in line with due process.

Discordant Tunes within MTN
But the submission of Moolman was at variance with that of MTN Chairman, Dozie, as the turn of events seemed to portray Moolman to be more honest than Dozie in what was viewed as a paradox. This is moreso that Dozie, being a Nigerian was expected to be more factual than Moolman who is a foreigner as Dozie outrightly denied the allegation of illegal repatriation of any fund by MTN, arguing that MTN had invested $16 billion in Nigeria within 16 years.

He also shocked the committee when he claimed that MTN had never broken any law in Nigeria, a submission which compelled the chairman to interrupt him as he reminded Dozie of the recent fine of N1.04 trillion imposed on MTN by Nigeria Communications Commission (NCC) following breaches of telecoms regulations. But Dozie quickly claimed that the fine was not caused by a breach of any law. This made the chairman to further express shock over the comment that the fine was not caused by a breach of a law, prompting Dozie to further claim that he meant MTN had not broken any law in relation to the matter under investigation.

The committee also frowned at a comment by Dozie that MTN did Nigeria a favour by investing in Nigeria as it expressed disappointment over such a comment, insinuating that MTN did Nigeria no favour by coming to Nigeria. Dozie swiftly denied making such comment until the committee insisted that the entire session was being recorded and they would not mind rewinding it and playing it into his hearing. Then, Dozie retorted: “I’m surprised l said that.”

Dozie had in his presentation, said the money imported to Nigeria was done in three tranches as he insisted that the allegation by the Senate “was completely false.”
According to him, when MTN came to Nigeria, it offered 40 per cent shares to Nigerians while it took the other 60 per cent only to find that it was difficult to get Nigerians to invest 12 per cent of the 40 per cent offer. He added that MTN had to bring other investors before it could secure 25 per cent of the offer.

Dozie further said it was these Nigerians who constituted Celtelecom adding that a conversion of Celtelecom investment was done in 2007 through its bankers with CBN approval as he exonerated Enelamah, saying he was not a shareholder in MTN but only a director of Celtelecom and CEO of Capital Alliance which he said midwived the Celtelecom.

But Melaye countered him as he displayed a form signed by Enelamah on February 7, 2008 for repatriation of fund with a CCI form attached the same day investment was said to have been made in Nigeria as he queried: “Is it possible to invest in Nigeria same day and repatriate funds same day?”
Melaye also confronted Dozie and MTN CEO with evidences that whereas CCI was supposed to have been issued within 24 hours before repatriation, such CCIs were not issued until five years later as he dismissed Dozie’s claim that Nigerian laws were not flouted in the process. “The law says CCI should be issued in 24 hours but CCIs were issued five years after. Is that not a contravention?” he queried.
Melaye also said he had information that whereas CBN approved only 13 CCIs, Stanbic IBTC only had issued over 300 CCIs without containing the necessary information it ought to contain.

CBN, Banks
But CBN in its submission said it only approved CCIs beyond the 24-hour stipulation when it was obvious that banks could not issue the document within the stipulated time.
In his submission, Managing Director of Diamond Bank and son of Dozie, Uzoma, said the bank had issued some CCIs to MTN as he admitted that the bank had been involved in repatriation of funds by MTN but added that such repatriations were “carried out with appropriate documentation,” adding: “None was repatriated without genuine CCIs.”

Also speaking, the CEO of Stanbic IBTC, Olayinka Sani, who evaded questions directly put to him, said his bank was ready to co-operate with the committee in its investigation adding that it had represented MTN in various capacities since the company opened an account with the bank. But Melaye took on Sani, recalling how the bank was recently fined N1 billion for misconduct. He also alleged that Stanbic IBTC fraudulently got an approval to transfer N$40 million which it declared as mutilated lower dollar notes to the United States recently with the supposed intention to exchange the notes for new ones.

According to him, it was later found that the notes were not mutilated as claimed by the bank neither were the notes lower dollar denominations as claimed by the bank but rather $100 notes. While asked to confirm the altruism of the allegation, Sani said the matter was already subjudice and so he would not like to comment on it.
Also, the Managing Director of Citibank, Akin Daodu, said the bank had never been involved in any illegal repatriation of funds as he disclosed that Citibank had issued 46 CCIs on behalf of MTN so far.

But in view of Daodu’s claim, Melaye drew his attention to the document his bank had earlier submitted to the committee where it had stated that “MTN didn’t request for CCI’s to be issued until more than the 24 hours,” required to issue the CCIs. Against this background, he could no longer defend the claim he earlier made moreso that Melaye reminded him that he was making his submissions under oath.

In her own submission, the CEO of Standard Chartered Bank, Mrs. Yemi Owolabi, admitted that in most cases when they were contacted for issuance of CCIs by MTN, prevalent circumstances made such issuance impossible within the stipulated time frame.
According to her, such circumstances had always compelled the bank to contact the CBN to explain the difficult circumstances in which it found itself, pointing out that they only issued the documents after securing the go-ahead from the apex bank. “Until we get approval from CBN, we don’t issue CCI,” she added.

Towards the end of the meeting, Moolman reiterated that MTN had not claimed that it had complied with the 24-hour regulation for the issuance of CCI 100 per cent but explained that such developments were dictated by circumstances beyond its control.
In its submission, FRCN blamed CBN’s failure to play its regulatory role dutifully as the reason for continuous depletion of Nigeria’s foreign reserves. He said the kind of regulatory roles being played by CBN are weak, poor and devoid of accountability as he added that the CBN needed to be watched closely if cases of financial misconduct must be checked.

Forensic Experts
Nevertheless, to enable it get to the root of the matter, the Senate has engaged the services of both foreign and local forensic experts to help it in unravelling the truth behind the allegation.
According to the committee chairman, Ibrahim, the Senate had engaged forensic experts to assist it unravelling the mystery behind the mystique because the allegation against MTN, Enelamah and others is weighty and hence, will require the services of experts to help the committee get to the root of the matter. Hence, Nigerians wait for the output of the probe as the investigation continues.