The fund, which reportedly belonged to Mr. Daniel Chukwudozie, the Managing Director of Dozzy Oil and Gas Limited, was for investment in shares through the Bank.
Francis Atuche, a former Managing Director of Bank PHB, is also accused of forging board resolutions for a client-company in order to perfect the scam. Mr. Atuche reportedly diverted the funds by claiming that the deposit was made under “non-existing share placement.”
Standing trial alongside Mr. Atuche for conspiracy and for illegally obtaining the sum of N855 million are Deputy Manager of Keystone Bank, Mr. Anayo Nwosu, an Indian conspirator, Ashok Isran, representatives respectively of NULEC Company and Keystone Bank used to facilitate the fraud, Olajide Oshodi and Sunny Obazee, as well as the two companies involved in the fraud, NULEC Industries Limited and Keystone Bank.
Some top management members of Keystone Bank and NULEC are accused of diverting funds meant for subscription to shares through the bank to personal use. The accused are alleged to have funneled the funds to purchase shares in a company they knew to be bankrupt.
Mr. Atuche is accused of conspiring to use funds from investors’ funds to offset a company’s debts.
The EFCC witness produced documents at today’s resumption of the fraud trial. The documents included bank statements and mandate forms of accounts belonging to the defendants. The documents also indicated how funds left the operating accounts of NULEC Industries Limited to other overseas accounts only to be returned later to accounts operated by the defendants in Nigeria.
The witness also presented statements of accounts belonging to the defendants with the United Bank for Africa (UBA). The UBA accounts allegedly served as channels through which the funds were wired out of Nigeria and later returned.
The witness alleged that NULEC Industries used its domiciliary account with UBA to wire funds to RISA Enterprises in Switzerland, an overseas firm belonging to Mr. Isran.
The witness also disclosed that two separate letters were written to Skye Bank, GTB and UBA. Replies from the banks indicated that, prior to commencement of the private placement shares, NULEC Industries had been indebted to the tune of N130 million. Prosecution documents also showed that NULEC’s incorporating account was indebted as of July 16, 2008 when a first installment of N285 million hit the account.
According to the prosecution witness, “The money which was meant to be used for the private placement was converted to private use contrary to the agreed principle. The fund was also to be kept [in an] interest yield account, but they wrote the check in the name of NULEC Industries Limited instead of NULEC private placement account.”
Prosecutors also alleged that another sum of N19.5 million was kept with Dircom West Africa Limited which was a front company allegedly used by the top management staff of the bank. In fact, the third defendant Olajide Oshodi was the account holder and admitted during investigations that the fund was shared among the top management whose identities he failed to disclose, stating instead that he would take responsibility for his action, Mr. Orji told the court.
The witness accused the third defendant, Olajide Oshodi, of being the leader of the team that marketed the private placement to the Dozzy Oil and Gas. Prosecutors argue that the transaction was a clear demonstration that Keystone Bank did not carry out the responsibility as an investment bank to ensure that the money was utilized rather than allow the money to be diverted.
Mr. Atuche was Managing Director of Bank PHB. He is also standing once trial alongside his wife for alleged fraud at that bank.
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