A consortium of firms, lead by Messrs J.O.Atunbi & Co. (Chartered Accountants), has assembled a team of lawyers, made up Senior Advocates of Nigeria, to battle the Rivers State government over its alleged refusal to pay the firm its consulting commission of the Paris Club Refund.
The decision to drag the Rivers State government to court stemmed from what this correspondent gathered is the uncorporative attitude of the state government and its refused to pay the consortium firm its commission after helping the state to track, reconcile and recover over N100bn out of the $462. 593bn said to be excess deductions from the state’s loans by the Federal Government.
Controversy had trailed the payment of percentage to firms that helped states across the country to get the refunds from the Paris-London Club.
Since the inception of President Muhammadu Buhari administration, refunds have been made to states in tranches.
It was gathered that the consulting firm decided to hire SANs to sue Rivers State after several promises made to the firm to pay it the agreed commission, failed.
The leadership of the consortium has mandated the legal team to go after the assets of Rivers States anywhere in the world and approach the court to freeze accounts of the state, it was learnt.
It was gathered that the legal team has been asked do all it can, within the orbit of the law, to get injunction from the court to stop payment of revenue due to the state, and also monies accruing to it.
Several reminders to the state were said to have been ignored. One of the letters, dated July 18, 2017, reminded the state government of execution of the contractual agreement with the firm.
“We diligently executed the contract per the letter of engagement, finalized the reconciliation and submitted both the interim reports, progress reports and final report on the completion of the work.
“A demand of USD$462,593,183.07, was made on behalf of Rivers State to Hon. Minister Finance, DG, DMO, The Office of the Accountant General.”
The consortium said it has since confirmed that Rivers State Government has received not less N100bn refund as at July 17th, 2017, based on the submissions of the consulting firm to the Federal Ministry of Finance and Debt Management Office, the reminder stated.
Engaged as far back as 2014 by Rivers States, Messrs J.O.Atunbi & Co. had pressed for the loan refunds during the tenure of former Minister of Finance, Ngozi Okonjo Iweala under former President Goodluck Jonathan until Buhari started to pay the state in trances.
Efforts made by the firm at reconciling debt records which the Buhari administration inherited were detailed in one of the letters to the Federal Government, sighted by this reporter.
The letter read: “The above named company was appointed as consultants by some state governments to carry out reconciliation and recovery of all over deductions on foreign loans (1995 to 2006).
“Subsequently, the loan records were received and reconciled for all the states under our client list (1982 to 2006). It was discovered that the total deductions from the states’ statutory revenue from June 1995 to March 2006 (period of “first line charge policy”) were completely omitted in the past reconciliation exercises.
“It is important to kindly inform that Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC), Debt Management Office (DMO) and FAAC Sub-Committee did not include this period.
“Therefore, based on our findings, we submitted a demand notice to the then Coordinating Minister of the Economy and Minister of Finance as established over deduction of our clients (states).
“The purpose of this letter is to seek your kind intervention as the Chairman of Debt Management Office (DMO) to resolve these issues once and for all”.
Meanwhile, the letter of engagement written by Rivers government to the Messrs J.O.Atunbi & Co., dated March 1st, 2014, and titled: “Re: Back Duty Reconciliation and Recovery of Excess Deductions on Foreign Loans on Behalf of Rivers State Government Letter of Engagement,” was signed by Chamberlain S. Peterside, PhD, then Commissioner of Finance in the state.
The letter reads in part: With reference to your proposal for recovery of excess deduction in respect of foreign loans, we are pleased to offer you consultancy appointment under the following terms and conditions;
“That Messrs J.O.Atunbi & Co. (Chartered Accountants)…is authorized to review all foreign loans contracted by Rivers State for the purpose of recovering excess deductions on behalf of Rivers State Government;
“That such report of such recoveries will be made available to the Ministry of Finance (hereinafter referred to as Government);
“That all recoveries made in respect of this assignment will be paid into an account designated by the Accountant General, Rivers State;
“That an 18℅ Commission charge on reconciled and recovered amount will be paid to the consultant,” among other conditions.
Attempts to get Rivers State side of the story were unsuccessful as the time of going to press.