A lawsuit filed by the Nigerian government against US bank JP Morgan Chase, claiming over $1.7 billion for its role in a disputed 2011 Malabu oil deal, will proceed to trial.
This disclosure was contained in the ruling of London’s high court on Thursday, November 12, 2020.
The suit filed in the English courts in 2017 relates to the purchase of the offshore OPL 245 oilfield in Nigeria by oil majors, Royal Dutch Shell and Eni in 2011, which is the subject of ongoing litigation in Milan.
The Federal Government filed the legal action against JP Morgan Chase & Co for its failure to prevent the payment of about $875 million to corrupt parties.
The six-week trial in London is expected to commence on the first available date after November 1 2021, meaning that proceedings may not begin until 2022.
What you should know
According to an earlier report by Nairametrics, the case involves a $1.3 billion payment made by Shell and Eni to secure the OPL 245 oilfield, into a Nigerian government escrow account managed by JP Morgan.
It was however alleged that about $1.1 billion of that amount ended up in the account of Malabu Oil and Gas and was allegedly used to pay political bribes.
The prosecutors also alleged that former petroleum minister, Dan Etete, paid politicians, some middlemen and then half of it to himself.
As part of the proceedings, JP Morgan will also have to disclose within 21 days which individuals at the bank made the final decision to transfer the funds in question.
A spokesman for the Federal Government on this case said, “Nigeria is pleased that JP Morgan has agreed it will now confirm all the senior figures at the bank who were involved. This claim will move forward and Nigeria will hold JP Morgan accountable for its central role in the OPL 245 fraud.”
In the claim, Nigeria alleges JP Morgan was negligent in its decision to transfer the funds in escrow to Malabu oil and gas, a company controlled by the Dan Etete, instead of government coffers.
The damages sought by the Federal Government include the $875 million allegedly paid to Dan Etete, in 3 different instalments, plus interest taking the total to $1.7 billion.
The Milan trial began in 2018. In July 2020, Italian prosecutors asked a Milan court for Eni and Shell to be fined, and some of their present and former executives, including Eni’s CEO Claudio Descalzi, to be jailed.
They further requested that Eni and Shell be fined 900,000 euros ($1.06 million) each and sought to confiscate a total of $1.092 billion from all the defendants in the case, (the equivalent of the bribes alleged to have been paid).
Final defence arguments from lawyers representing Shell, Eni and its executives are being made to the court. The next hearing is scheduled for Nov. 25.