The
Presidential Committee on Audit of Defence Equipment Procurement (CADEP)
has traced about N2billion meant for the purchase of vehicles for the
Nigerian Army to the accounts of five children of a former Chief of Army
Staff. The Nation
reports that the report by the panel states that the children of the
ex-Chief of Army Staff allegedly used two companies for the deal. Read
it after the cut..
“The
committee reviewed the procurement carried out by Chok Ventures Ltd and
Integrated Equipment Services Ltd, two companies that shared the same
registered office, had one name as common controlling shareholder and
sole or mandatory signatory to the various banks accounts of the
companies. The committee further
established that between March 2011 and December 2013, the two companies
exclusively procured various types of Toyota and Mitsubishi vehicles
worth over N2, 000,000,000.00 for the Nigerian Army without any
competitive bidding. Most of the
contracts awarded to the companies were also split, awarded on the same
date or within a short space of time at costs and mobilization higher
than the prescribed thresholds. For instance, on February 13 and 15,
the two companies were awarded contracts worth N260, 000.000.00 and
N315, 000,000.00 respectively for supplies of various vehicles. The
Nigerian Army could not justify the exclusive selection of these vendors
against other renowned distributors of same brands of vehicles
procured. More seriously, the
committee found no credible evidence of delivery of the vehicles by the
two companies as there were no receipt vouchers, but only
unauthenticated delivery notes, invoices and waybills that were
purportedly used for the deliveries. Nevertheless,
the vendors were fully paid based on job completion certificate
authenticated by the then Chief of Logistics, Maj Gen D.D. Kitchener
(rtd). The payments were also made without deduction of Withholding Tax
(WHT). Furthermore, analyses of the various bank accounts of the two
companies showed transfers to individuals , some of who are believed to
be children of the army chief. Thus,
the committee recommends further investigation to determine delivery of
the vehicles and relationship of funds beneficiaries with the former
COAS and the two companies. Furthermore, the panel said that Lt Gen O.
A. Ihejirika (rtd), Maj Gen D. D. Kitchener (rtd), Col A. M. Inuwa and
Mr Chinedu Onyekwere should be held accountable for the issues arising
out of the contracts.”
The panel during its findings discovered that contracts in the Nigerian Army were awarded without due process. It said a company was registered on November 17, 2014 and awarded $125,179,299.10 on the same day.
“The
Nigerian Army, between April and August 2014, entered into four
contract agreements with Societe D’Equipmenteux Internationale (SEI Nig
Ltd) for procurement of Cobra Armoured Personnel Carriers, Shilka
Self-Propelled Artillery Guns, Armoured Fighting Vehicles (AFVs) as well
as various ammunition and spares funded by the ONSA. The
contracts for the Cobra APCs and Shilka Guns were not executed as they
were not funded. However, the costs for procurement of the AFVs;
ammunition and spares were $398,550,000.00 and $484,765,000.00
respectively totalling $883,315,000.00. In
November 2014, the ONSA awarded contract to Conella Services Limited
for procurement of 72 various arms and ammunition that included MRAP
vehicles, Mi-17 helicopter at the cost of $125,179,299.10. The
committee observed that the company was registered in Nigeria on 17
November, 2014 and awarded the contract on the same date, while the EUC
for the procurement was issued a day later on 18 November, 2014.
Furthermore, the ONSA paid $36,996,530.00 and N2,209,582,296.00 to the
vendor between November 2014 and 15 April, 2015.
However, the Nigerian Army denied receipt of any procurement from Conella Services Ltd.
“Similarly,
the committee tried in vain to reach officials of the company to
confirm execution of the contract. There is, therefore, the need for
further investigation of Conella Services Ltd. The
committee observed that SEI and its two associated companies, APC Axial
Ltd and HK-Sawki Nig Ltd, were incorporated in May 2014 with two
Nigerien brothers, Hima Aboubakar and Ousmane Hima Massy as the only
directors. Between May 2014 and
March 2015, the ONSA mandated CBN to release various sums totaling
$386,954,000.00 to SEI and the two associated companies for ‘procurement
of technical equipment’, without tying the money to particular items of
procurement. Thus, the
allotment of the funds was left at the discretion of the vendor without
input or consultation with ONSA or the Nigerian Army. Furthermore,
some of the funds transferred preceded the formalization of SEI
contracts with the Nigerian Army. There was also no evidence of any
contract to justify the payments made by ONSA to the SEI associate
companies. Consequently, it had been difficult for the ONSA, the
Nigerian Army and SEI to reconcile the accounts vis-a-vis the equipment
delivered.”
The
panel also uncovered that 42 units of Armoured Personnel Carrier(APC)
which were rejected by Iraq were later sold to Nigeria to fight Boko
Haram insurgents. It claimed that some of the APCs were either expired or unsuitable leading to loss of lives.
“The committee observed that one of the new equipment SEI procured for the Nigerian Army from Ukraine was BTR-4E APC.”
However,
according to the Ukraine’s state enterprise, Lviv Armour Repair Plant,
the designers of the equipment, “some of the products sold to Nigeria in
2014 were actually among 42 units designed for Iraq which subsequently
rejected them due to poor performance rating”.
“The
Nigerian Army did not also undertake the mandatory pre-shipment
inspections provided for in the contract agreements. Instead, the NA
deployed an infantry officer, who lacked the technical knowledge to
assess the capabilities and shortcomings of the equipment, to oversee
the shipment of the items for the Nigerian Army from Ukraine. Additionally,
the two-week training availed the technicians and operators was
inadequate for them to comprehend the technical workings of the newly
introduced equipment. The
committee’s interactions with the field operators revealed that although
the platforms and ammunition procured by SEI were deployed for the NE
operations, some of them were aged or expired, lacked spares and prone
to breakdown without immediate recovery equipment. Therefore,
failure to carry out pre-shipment inspection and inadequate training
resulted in procurement of some unreliable equipment that reduced the
capacity of the Nigerian Army in the North East operations and resulted
in the loss of lives and equipment.”
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