As Questionable Rulings Abound



Akeem Ogunlade writes that perverting the course of justice is becoming rampart in Nigeria due to the pecuniary interest of judges, especially in cases involving financial institutions and bluechip companies owned by foreign entrepreneurs

It was the lead story on the front page of Thisday newspaper on Wednesday April 18, 2018. The report, titled, UBN Drags Judge Before NJC, EFCC over Alleged Collusion with Churchgate Owner, triggered a curiosity that took me down memory lane. Citing a 44-page petition, the report stated that Union Bank of Nigeria (UBN) Plc had dragged Justice Ibrahim Buba of the Federal High Court before the National Judicial Council (NJC), the Economic and Financial Crimes Commission (EFCC) and the Department of State Services (DSS) for alleged professional misconduct.

Buba, the bank claimed, “colluded with one of its huge debtors, Mr. Bhagwani Mahtani, a naturalised Nigerian businessman of Indian origin and chairman of the Churchgate Group, to defraud the bank and pervert the course of justice.” The judge, it added, “used his intellectual prowess to bend the rules and use his position to the advantage of the debtor by allegedly turning the law upside down in favour of the debtor – Mahtani, the alter ego of First Continental Properties Limited, a subsidiary of the Churchgate Group. The petition alleged that Justice Buba deliberately destroyed the legal mortgages that were entered into to guarantee repayment of a $68 million loan originally granted Mahtani and First Continental Properties in 2011.”

Union Bank described Justice Buba’s judgment as “most unreasonable and difficult to understand, thereby conferring benefit to the unrighteous at the expense of the righteous in an alleged bid to make financial gains.” The bank therefore asked EFCC and NJC to intervene and investigate the judge, as losing the amount involved could affect its fortunes as it is part of depositors’ and shareholders’ funds.

The Churchgate Group reportedly denied the allegations in the petition, according to Thisday, claiming instead that Union Bank actually got favourable judgment delivered on February 28, 2018 “but was dissatisfied with the judgment and had gone on appeal.”

The mention of Mr. Bhagwan Mahtani brought back memories of curious coincidences and another protracted litigation that almost crippled another major bank some years back. The incident also appears consistent with the sullied reputation of some notorious Indian businessmen who exploit gaps in Nigeria’s legal and policy frameworks to engage in unethical conduct, sometimes bordering on outright fraud and duplicity. A few years back, EFCC filed a three-count criminal charge against Sandeep Gogia, a Lagos-based Indian businessman, and his company, Eastern Metal Limited for allegedly swindling a Nigeria company, Boars Communications Limited. Sandeep Gogia and another accomplice, Arun Goswani allegedly obtained $250,000 from Boars Communications Limited under the pretext that he will provide the naira equivalent. It was a ruse. The exploits of the Vaswani brothers, Sunil, Haresh, and Mahesh, owners of the Stallion Group, are well-documented. Their alleged fraudulent business activities became so unbearable for Nigeria that they were deported during the administration of President Olusegun Obasanjo. Even the Umaru Yar’Adua administration, which readmitted them, later expelled them again. Their alleged offences ranged from criminal conspiracy, tax evasion, and economic sabotage to money laundering.

Back to Bhagwan Mahtani of Churchgate Group again, a group of minority shareholders of Stanbic IBTC Holdings Plc, under the aegis of Trusted Shareholders Association (TSA), had called on the regulators of the financial services industry to suspend a proposed rights issue. They alleged that billions of Naira were deducted from the gross revenue of the organization and warehoused in a suspense account to be transferred to its offshore holding company as payment for franchise/ fees, which was not approved by Nigeria’s National Office for Technology Acquisition and Promotion (NOTAP).

As the matter unraveled, it came to light that TSA was actually a front used by the Mahtani brothers, Bhagwan and Ratan, to truncate the fund raising. Into the fray came the Financial Reporting Council of Nigeria (FRCN), acting more like a hatchet man, rather than an unbiased regulator. The matter went to court to determine if FRCN and NOTAP had powers to impose the sanctions. Curiously, the matter was brought before Justice Buba who dismissed the proceedings sought by the bank. He described the questions raised by the organization as hypothetical and academic. The matter went on appeal and was eventually amicably resolved by the feuding parties.

The above details are designed to illustrate to what extent these unscrupulous elements are willing to go to undermine legitimate institutions and processes. Interestingly, observers in our political space would recall the perpetual injunction granted by Justice Buba barring security agencies from investigating former governor of Rivers State, Peter Odili, for corruption. Justice Buba, in another curious ruling, granted a perpetual injunction retaining Mahtani on the board of Stanbic IBTC. Also Justice Okon Abang was once berated by the Court of Appeal for miscarriage of justice after he sacked Governor Okezie Ikpeazu of Abia State when he ruled that Ikpeazu submitted false tax clearance papers in a pre-election contest.

Without even being a lawyer, these doubtful rulings call to question not just the integrity of the judges but more importantly the role of the judiciary in compounding the difficulties of doing business in Nigeria. For a country that desperately seeks foreign investment, taking actions, whether by the executive, judiciary or parliament that provoke unnecessary investor apprehension, capital flight or disincentive to FDI inflow is condemnable. A recurrent party in these questionable actions, the Churchgate Group has unfortunately developed a reputation for controversy and noxious activities, not just in Nigeria, but across Africa. An online platform, National Waves, in recounting another scandal claimed that way back in 1986, the Mathanis were “charged to court by the federal government for alleged economic sabotage and exchange control malpractice and were found guilty, expelled and ordered to be deported to India from Nigeria.” Known then as the Manshaudani family, they reportedly changed names and international passports and returned to Nigeria in 2002 to continue ‘business as usual’, the medium stated. The Mathanis later refuted the alleged change of names and deportation from Nigeria.

Nigeria’s National Bureau of Statistics (NBS), in a survey covering June 2015 to May 2016, indicted “law enforcement agents such as the police and judiciary workers such as judges and magistrates” as the highest takers of bribe in Nigeria. It said 32.3 percent of Nigerians had to pay some form of bribe to public officials between June 2015 and May 2016. A whopping N400 billion was received in bribes by public officials within the period in review, NBS stated.

December 2015 in neighbouring Ghana, following a diligently executed sting operation and expose by Ghanaian investigative journalist, Anas Aremeyaw Anas, 21 judges were sacked by the country’s Chief Justice, Georgina Wood for taking bribes, attempting to subvert justice and violating the constitution.

Recently, Justice Raliat Adebiyi of the Lagos State High Court, Ikeja sentenced Dr Joseph Nwobike, a Senior Advocate of Nigeria, to 30 days in prison for offering gratification to judges and court officials as well as perverting the course of justice. Daniel Danladi, a detective with the Economic and Financial Crimes Commission (EFCC) had named four judges allegedly involved in the gratification scam.

If insinuations of judges being in the payroll of dubious businessmen are proven, believing that NJC and EFCC would investigate Union Bank’s allegations, it simply reinforces the scathing stance of President Muhammadu Buhari that Nigeria’s judiciary is home to corrupt judges who place pecuniary gain above professional ethics and national good. The world is patiently watching to see how EFCC, DSS and NJC would respond to UBN’s allegations.

– Ogunlade is of the Centre for the Promotion of Enterprise and Business Best Practice, Wuse 2, Abuja