The Office of Nigeria’s Inspector General of Police (IGP) is in court with some Nigerian businessmen accused of allegedly fraudulently obtaining N13.5 billion from a foreigner under the guise of a multi-million-dollar foreign exchange transaction.
This is according to the IGP’s legal team’s pending lawsuit before the Federal High Court, marked FHC/ABJ/CR/518/2022, exclusively seen by Nairametrics.
The police allege that a foreigner, Rafik Akar, was defrauded by Victor Arinze, Yahaya Karami, and three others partly involved in Bureau de Change (BDC) businesses.
They purportedly induced him to transfer the naira equivalent of $38,260,000 (at N353.00 per $1 in 2019).
Issues Associated with the Alleged Forex Business Deal
- Nairametrics’ review of legal documents in the case shows that the matter is linked to a formal petition alleging economic sabotage through fraudulent transfers and money laundering, dating back to 2019.
- According to the legal documents, Muhammad Adnan (a Lebanese), Akar, and the defendants allegedly agreed to exchange the dollar equivalent of the naira.
IGP Allegations and Legal Developments
The IGP’s legal team, led by Simon Lough SAN, accuses the defendants of conspiring to defraud Rafik Akar of N13,505,780,000, part of which was paid into the bank accounts of Pearson Nigeria Limited, Lasuccess Ventures Ltd, Rainforest Ballroom, and Cynosure Lounge—companies allegedly linked to the defendants.
The defendants were also accused of: “Acting in concert and with intent to conceal or disguise the origin of the said N13,505,780,000.00, you fraudulently obtained from Alhaji Rafik Akar on the pretence that you have $38,260,000 dollars to sell to him at the rate of N353.00 per $1.
“Based on that deceit, he transferred the naira equivalent of the dollars, which amounted to N13,505,780,000.00, into your companies’ accounts and shared it among yourselves.”
The police alleged that the defendants used the funds to purchase some properties which are scattered in Lagos, Abuja and Delta states.
The IGP’s legal team further claimed that the Thailand police, in collaboration with the Nigerian police, later discovered that the $38,260,000 the defendants allegedly promised the foreigner were “proceeds of fraud.”
- The police maintain that the development contravened Section 18 of the Money Laundering (Prevention and Prohibition) Act 2022.
- Nairametrics gathered that the defendants have been arraigned before Justice James Omotosho and pleaded not guilty to the charges, paving the way for trial.
- During proceedings on January 17, 2025, Akar testified in court that he made various payments in different tranches to the defendants, as itemized by the police.
- The next hearing date for his evidence is slated for March 3, 2025.
According to court documents, investigating police officers are expected to testify about their findings and tender exhibits in the ongoing case.
Context
The money laundering legislation was aimed at strengthening the existing system for combating money laundering and related offences, making adequate provisions to prohibit such activities.
According to comments made by the EFCC Chairman, Olanipekun Olukoyede, during the 17th Annual Banking and Finance Conference organised by the Chartered Institute of Bankers of Nigeria, several unethical practices are plaguing the financial sector, including foreign exchange manipulation, fraudulent charges imposed on depositors, and active involvement in money laundering schemes.
“Sharp practices such as forex trading, defrauding depositors through phantom charges, and complicity in money laundering and illicit financial schemes involving politically exposed persons continue to undermine the integrity of the sector and, by extension, the nation’s economy,” he said.
- As of October 2024, security agencies, particularly the EFCC, recovered ₦248,750,049,365.52 and $105,423,190.39, among other foreign currencies.
- About 3,455 convictions were recorded across all categories of financial crimes and corruption.
The expert view suggests a surge in fraud cases in Nigeria, stressing it threatens to derail Nigeria’s progress, as well as the growth of individual and small businesses.
What This Means
The case further highlights the ongoing legal efforts by law enforcement authorities, especially the Nigerian Police, to curtail perceived unlawful activity and enforce the extant provisions of the Money Laundering Act—legislation that covers a broad range of definitions and implications for financial crimes.
- A related case occurred a few weeks ago, where a freezing order on 21 bank accounts linked to money laundering and other unlawful activities was obtained by the police.
- A police detective submitted in court that the acts of the suspects were indicative of money laundering and were designed to conceal the origins of the said funds.
The Money Laundering (Prevention and Prohibition) Act 2022 stipulates jail terms for acts such as concealing the origin of funds, evidence, and fraud, among others.
