NEXIM Bank Paid N31.68m Without Required Approvals – Auditor General

The Nigeria Export Import Bank (NEXIM) paid a total of N31.68 million in 2024 on legal services and reimbursable expenses without meeting required regulatory and documentation requirements, the Auditor General of the Federation has disclosed.

The findings were contained in the 2024 Annual Report on Non Compliance of the Office of the Auditor General for the Federation, following an audit of the bank for the period January 1 to December 31, 2024.

According to the report, NEXIM paid N30.68 million to some external legal firms for services rendered without obtaining the approval of the Attorney General of the Federation, contrary to the provisions of an establishment circular governing the engagement of external solicitors by government agencies.

The report said the payments exposed the bank to risks including payment of higher legal fees, engagement of incompetent solicitors and loss of public funds. The Auditor General attributed the irregularity to weaknesses in the internal control system of NEXIM Bank.

The report cited Paragraph 2(a) of Establishment Circular Ref. No. SGF/PS/CIR/625/1 of July 16, 2003, which requires Ministries, Departments and Agencies to obtain the approval of the Attorney General of the Federation before external solicitors or advocates are hired and legal fees agreed.

It further stated that Paragraph 2(b) of the circular requires claims for professional fees to be submitted to the Attorney General for clearance and approval, accompanied by the relevant letter of instruction and a comprehensive report on services rendered, including copies of processes filed on behalf of government before payment.

However, audit findings showed that NEXIM paid N30.68 million to legal firms during the year without the required approval. The bank, in its response, disputed the applicability of the circular to its operations.

According to management of the bank, the Attorney General of the Federation circular was directed at legal officers who are primarily staff of the Federal Ministry of Justice and agencies funded by government.

NEXIM argued that as a self-sustaining agency and a separate legal entity from government, its liabilities would not extend to the Treasury and that it does not file cases on behalf of government. “The circular was not aimed at agencies like NEXIM,” the management stated.

The Auditor General, however, rejected the explanation, describing the response as unsatisfactory and maintaining that the audit finding remained valid pending implementation of its recommendations.

Consequently, the Auditor General recommended that the Managing Director and Chief Executive Officer of NEXIM should account to the Public Accounts Committees of the National Assembly for the N30.68 million.

The report further directed that the entire amount should be recovered and remitted to the Treasury, with evidence of remittance forwarded to the Public Accounts Committees. It warned that failure to comply should attract sanctions for gross misconduct under Paragraph 3129 of the Financial Regulations 2009.