An Abuja division of the Federal High Court has made an interim order freezing bank accounts belonging to Benue state government domiciled in some Nigerian banks as a result of its failure to pay back a N333 million loan secured in 2008.
The presiding judge, justice Iyang Ekwo made the order on Wednesday following an ex-parte motion marked FHC/ABJ/AMC/74/2021 filed on September 30 and moved by Darlington Ozurumba, Counsel to the Asset Management Corporation of Nigeria (AMCON).
According to the News Agency of Nigeria, the judge also directed that the bank accounts of HPPS Multilinks Services Ltd be frozen pending the hearing and determination of the suit. He then adjourned the matter till November 2, for mention. AMCON is the claimant in the suit, HPPS Multilinks Service Ltd is the 1st respondent and Benue state government, the 2nd respondent.
Order made by the court
The court made an interim order “freezing and attaching the JAAC Bank Accounts (Joint Accounts Allocation committee), Internal Generated Revenue Accounts, all bank accounts both current, savings, fixed deposits and/or investments accounts of the 2nd respondent (Benue state Government) maintained with all the banks mentioned above pending the hearing and determination of the substantive suit.’
“An interim order is hereby made restraining all banks and/or other financial institutions above mentioned in Nigeria forthwith from releasing or dealing in any manner howsoever with monies held in any account to which the respondents are signatories pending the hearing and determination of the substantive suit.
“An order is hereby made directing all banks and/or other financial institutions in Nigeria to, within seven (7) days of the date of service of this order, file and serve an affidavit of compliance disclosing with statement on each account howsoever designated, held and/or maintained by the respondents and all accounts to which the respondents are signatories for a period of six months prior to the date of service of this order till date.”
What you should know
The affected bank accounts for the two respondents are domiciled with Access Bank Plc, Citibank Nigeria Limited, Eco Bank Nigeria Plc, Fidelity Bank Plc, First Bank Nigeria Plc, First City Monument Bank Plc, Guaranty Trust Bank Plc, Heritage Bank Plc, Keystone Bank Limited, Polaris Bank Limited, Stanbic IBTC Plc, Standard Chartered Bank Nigeria Limited, Sterling Bank Plc, Suntrust Bank Nigeria Limited, Union Bank of Nigeria Plc, United Bank for Africa Plc, Unity Bank Nigeria Plc, Wema Bank Plc and Zenith Bank Plc.
In an affidavit in support of the motion deposed by Abubakar Isa, a staff of AMCON, AMCON described the loan as a toxic loan of eligible bank assets transferred to it by law to recover.
AMCON told the court that the first respondent had collected a N333 million loan facility from Bank PHB Plc (now Keystone Bank Ltd) on January 31, 2008 “for the purpose of purchasing 5,000 pieces of motorcycles to the 2nd defendant and its workers through the Nigeria Labour Congress of its state vide an irrevocable standing payment order (ISPO).”
Parts of the affidavits reads ‘’That the 2nd respondent is the state government of the beneficiaries who equally gave ISPO guarantee for the repayment of the loan through deduction from the salaries of its workers to make payment to the bank but failed to do so.’’
According to the said affidavit, the loan was for the agreed period of 24 months at the interest of 19% per annum.
