Alleged N76Billion Fraud: How Union Bank Sold Performing Loans As Non-performing To AMCON

The Lagos State Special Offences Court, sitting in Ikeja, today  was told how Union Bank Plc sold performing loans as non-performing loan to Asset Management Corporation of Nigeria, AMCON, in the on-going criminal trial of alleged N76Billion fraud leveled against Mr. Ahmed Kuru the former Managing Director of AMCON, and four others. 

The  third Prosecution Witness, Abas Jega, a former Executive Director Credit, of AMCON told the trial judge, Justice Mojisola Dada, that following a meeting between the AMCON Executives and Union Bank Executive, in London, at the instance of Union Bank, the reality was dawn on them that what the Union Bank Plc claimed to have sold to AMCON as loan was actually a guaranteed giving to foreign lenders,as the loan was performing.

   While being led in evidence by the EFCC prosecutor,Dr.Wahab Shittu SAN, Abas Jega told the court that ” When we took over the loan arraignment from the Union Bank we found out that it was not performing. The nature of the facilities have been changed. But Arik was not amenable to the cause. This would have complicated relationship between Arik and AMCON. 

“When we came back to Nigeria from the London meeting, we approached Union Bank to explain the issue. We told the Union Bank that they should return the money we paid for the guarantee. It was AMCON which made the payment on behalf of Arik Airline. 

“I can record vividly that the Chairman of Arik was avoiding instruction from us because be believed he should not be speaking having non-performing loans with us”. 

The Witness said AMCON didn’t give Arik money to help them sort out their problems. He testified that the loans AMCON gave was different from the one it recovered. 

“The money we collected back from Union Bank as guarantee was being held in our purse for another purpose. We created a loan in AMCON, but the money was also with us. 

“In Aviation industry, airlines don’t take loans to buy aircrafts. They usually make arrangements, like Arik did, whereby they will get a bank to bankroll”, he said. 

    Mr Abas further testified that while being in AMCON, he tried two things to save the situation which include appointing a managing director for Arik and a financial controller for oversight and financial control so as to save collapse of the airline. 

He said, though, Arik agreed to the proposal, but they foot dragged execution of the implementation. He said one of the directive of the Central Bank of Nigeria, is AMCON can only buy non-performing loans from banks.

      The presiding, Judge Mojisola Dada has adjourned till June ,30,2025 for the continuation of trial.