Nigeria’s image has taken a lot of bashing recently with its mission in the United States accused of money laundering. Despite the mission’s strong denial, some questions remain unanswered. EZRA IJIOMA writes.
Controversy has continued to trail the changes made in the accounts of the Embassy of Nigeria in some banks in the United States. For months there have been reports in the social media that the accounts of Nigeria Embassy and Consulate in the US were closed by US financial regulators because of money laundering charge but the Embassy had vigorously denied the charge.
In a statement made available to journalists last Wednesday, June 20, the Nigerian Embassy denied that its accounts were frozen but said that the change in its accounts was due to difficulty emanating from stringent financial rules made by the US government in order to block foreign funding of terrorist activities.
The Embassy cited the US PATRIOTS Act which entails large amount of paper work and staff time which caused US banks to advise the countries affected, mostly from Africa, to close their accounts and open new ones somewhere else within four months.
“Those African banks including Nigeria which eventually found other banks could only do so through American banks which had branches in their countries. This is what the Nigerian embassy did with the active support of our Central Bank. The Central Bank pays our allocation to the bank and missions operate it from here,” the Embassy continued.
It denied even having accounts with the banks mentioned in the story but failed to mention the banks it has accounts in and also the bank which CBN is using to service the missions.
Also, when contacted on the issue, the US Embassy in Nigeria diplomatically parried the issue. It told LEADERSHIP that in the last two years, many US banks have closed “all or some of their diplomatic mission banking business and a number of foreign missions to the U.S. have been affected.
“The USG [United States Government] has been working to assist foreign missions in finding new bank accounts for many months, and we have largely been successful. Unfortunately, after the most recent closures, some countries are again without accounts.
“The Department continues to work with the affected missions, relevant U.S. agencies, and the private sector to find a way to ensure that these foreign missions have access to the banking services necessary to maintain their operations here in the United States.
“These closures are the result of U.S. financial institutions’ decisions. We refer you to the individual banking institutions as they are in the best position to speak to their business decisions.”
The statement did not mention Nigeria neither did it deny the charge of money laundering against the Nigeria Embassy accounts or even mention the banks involved for further inquiries.
However, those close to the activities of the Nigeria Embassy in US still maintain that the accounts were frozen because of money laundering.
They said that there had been irregular and unusual movement of funds within a very short period of time in the Embassy’s three accounts with Wells Fargo, Bank of America and M&T Bank which led the US Treasury Department to demand for explanations from the Embassy. Not satisfied with the explanations particularly the withdrawal of $50, 000 in cash, the accounts were frozen.
An online news site elombah.com had recently written, “These accounts attracted the attention of US authorities when it became apparent that over 3.6 million dollars were irregularly moved into and out of these accounts within a relatively short time. The U.S. Treasury Department through the State Department in a letter to the Embassy of Nigeria demanded an explanation for such unusual and irregular movements of funds.”
The three banks, Bank of America, M&T Bank and Wells Fargo, were said to have been directed by the US government to close the accounts of the Nigerian embassy in Washington and its consulate in New York on suspicion of money laundering after money traffic on the various accounts raised a red flag.
Also, analysts point to President Goodluck Jonathan’s directive to Economic and Financial Crimes Commission (EFCC) to investigate the Embassy’s accounts account as evidence of probable guilt.
At the media chat last Sunday, President Jonathan had said, “Only yesterday, I directed EFFC to go and investigate our bank accounts in the US because there was this story in one paper [LEADERSHIP] that the US authorities are looking into, because there are some money transfers and so on.
“Then, I asked the minister, he gave the story from the ambassador, but, that is not enough. I need a neutral person to go.”
Foreign affairs analysts told LEADERSHIP that the failure of Ambassador Olugbenga Ashiru to properly investigate such a serious issue only shows that there is panic in the system to address the issue.
“Why would the Minister hurriedly present to Mr. President a one-sided report, a report based on just what the accused said,” a foreign analyst who pleaded anonymity said. He added that the involvement of EFCC shows the President’s doubt over the neutrality of the Minister in the case. “If the Minister had an interest in the case, he did a bad job of it and now the genie is out of the bottle.”
Also, a Nigerian lawyer who worked for the Embassy of Nigeria in the US for eight years before the relationship went sour about three years ago said that the Embassy is not telling the entire truth. Emeka Ugwuonye in an exclusive interview with LEADERSHIP said the Nigerian embassy’s statement “is remarkable only in its context of failure to tell the truth.”
Emeka asked, “Why did it take the Embassy of Nigeria more than two weeks since the story came out before it would respond to what it now calls malicious allegations intended to malign the integrity of the leadership of the Nigeria mission in the US?
He said that the PATRIOT Act has been in force since 2002 and queried why it would take ten years to become a banking problem for African missions in general and Nigeria in particular.
If the PATRIOT Act and terrorism financing were truly the problems for the crisis the Embassy of Nigeria is facing, why would that affect African countries more than it affects Middle Eastern countries,” he asked.
Ugwuonye, who is the president of ECULAW Group, continued, “For instance, there has been highly unusual movements of funds into and out of the accounts operated by the Embassy. When compared with the periods going back figures years, the amounts coming into the accounts and moving from the accounts are without precedent in figures and frequency.
“At the same time, there were some questions as to the purpose of the funds movement. Embassy bills are still not being paid. Some of the vendors who were owed by the Embassy must have reported the Embassy to the US State Department seeking assistance in getting the Embassy to pay. The picture painted by the Embassy for not paying its vendors has been that it did not have money. The conclusion must have been that the money coming into the Embassy accounts were not being used for the Embassy purposes. That sort of pattern of behaviour triggers suspicion.”
While the Embassy denied having accounts in Bank of America, Wells Fargo and M&T Bank, its former lawyer countered that the Embassy had three accounts in M&T Banks alone and accounts in the other two banks.
Ugwuonye said, “To clear the air and be seen to be even-handed, why did the Embassy not state the banks where Embassy had accounts, if different from the ones alleged? After all the statement admitted that the accounts were closed (just the reason for the closure was different).”
On the argument that the $50, 000 withdrawn at once was used to pay estacodes to visiting Nigerian officials, some embassy watchers said that it is impractical that Nigeria Embassy that is always broke should fund estacodes of government officials. When the embassy still owes some of its vendors, why should pay the estacodes of government officials who ordinarily should have been taken care of by the agencies that sponsored them, they queried.
A source close to the Embassy told LEADERSHIP that the accounts problem arose because most Nigerian politicians and government officials travelling to the US would wire money into the Embassy’s accounts and have little on them to attract attention on arrival at the airports. “Embassy officials would then, for a cut as much as ten per cent, withdraw the money for these government officials to use in the US,” the source said.
LEADERSHIP gathered that this huge movement of cash was what actually attracted the attention of the US authorities and their subsequent action. This recent ingenious but illegal move addressed the embarrassment the government officials had to face when they are caught at the airports with huge sums of money which they failed to declare.
The source continued, “In one case, one minister was caught at the airport with undeclared cash three times in a single year. In some cases, the Nigerian officials would rather forfeit the cash than to fill out the paperwork or appear to explain the origin of the funds.
“The officials, when caught at the airport would call the Ambassador, who would then call the lawyer. But throughout the time, despite the headache that used to cause the Embassy, the Embassy never thought of providing its Bank accounts to be used by these people as a way to avoid this problem.”
With Jonathan’s instruction for the Embassy’s accounts to be investigated and the Embassy’s continued plea of innocence, EFCC has a huge task to get to the depth of this issue given its attendant consequences if not properly addressed.