CBN ordered to pay $3.2b to councils

The Central Bank of Nigeria (CBN) has been directed by a federal high court sitting in Abuja to pay the sum of $3.2billion wrongfully deducted from the accounts of the 774 Local Councils in the country.

The court ordered the immediate payment of “$3.1billion or Naira equivalent” back to the councils’ coffer.

Presiding judge, Justice A.F.A. Ademola, who delivered a ruling told the CBN after listening to the arguments of both sides, to go ahead to enforce the earlier judgement which directed a refund to the councils.

Lead Counsel to the councils, Mr. Joe Okay Agi (SAN), had prayed the court to garnishee the sum of $3.1billion in the hand of CBN and be paid to the Councils.

The CBN had told the court that it was in possession of over $26billion belonging to the Federal Government

The judge dismissed earlier reports that payments have been made, saying there was no such judgement directing payment into any account other than the councils.

“I have just delivered judgement today. There was no such order,” Justice Ademola added.

The order was in enforcement of an earlier judgement of December 10, 2013 in which the court faulted the deduction from councils’ account by the Federal Government to service loans owed to the London Club and Paris Club.

The plaintiffs had also secured a federal government fiat to execute the judgement since similar refunds were made to some states.

Judgment had been given in favour of the councils in the suit ( No FHC/ABJ/129/2013), filed on 11 June 2013, at the Federal High Court, Abuja.

In the suit, Aba North Local Government, some other councils (applicants) and Linas International Limited (creditor) sued the Attorney-General of the Federation, Ministry of Finance and Accountant-General of the Federation over the illegal deductions, totaling $3.2billion, made by the Federal Government from the statutory allocations due to them in respect of the 1992 London Club Debt buy-back and the 2006 London Club Debit exit spearheaded by Mrs. Okonjo-Iweala.

The plaintiffs were challenging a decision taken by the Federal Government in 1992, when the action was based on the 1999 Constitution, which did not become operational until seven years after the decision. The suit also challenged the fact that the decision of the Federal Government was taken 21 years earlier.