- Calls For Prosecution of Culpable Officers
The Centre for Anti-Corruption and Open Leadership (CACOL) has welcomed the decision of the Nigerian Senate to investigate the alleged irregular award of N3 billion contracts by the Federal Mortgage Bank of Nigeria (FMBN).
CACOL in a statement released by its Anti Corruption Organisation Director, Mr Tola Oresanwo on behalf of its Chairman, Mr Debo Adeniran said it would not hesitate to call for immediate prosecution of any official (s) of the bank found culpable in awarding the alleged contracts without proper approval.
The anti-corruption group was elated that the Senate Public Accounts Committee (SPAC) headed by Senator Mathew Urhoghide, has summoned the former Managing Director of FMBN, Mallam Gimba Yau Kumo, to give explanation on the irregular award of the contracts.
The summon followed the 2015-2018 report by the office of the auditor-general of the federation (AuGF) against the FMBN.
According to the query issued by AuGF, it was observed that a contract was awarded to a contractor in four phases at a total contract sum of N3,045,391,531.97.
The query reads: “Audit observed that a contract was awarded to a contractor in four phases at a total contract sum of N3,045,391,531.97. Audit however observed that the second, third and fourth phases of the contract were above the approval thresholds of the Bank. It was also observed from the examination of payment documents that the contractor was overpaid in the sum of N118,717,892.72 that resulted from irregular addition of 5% Withholding Tax in the Bill of Quantity on each of the four phases of the contract.”
According to the Audit after a physical inspection of the site, it was observed that a payment of N80,000,000.00 was made for the implementation of ‘Unified Access and Attendance System’ but the device was not working according to specifications.
It also added that a sum of N644,040,000.00 was also provided in the Bill of Quantities for offshore training and other deliverables in the 3rd and 4th phases of the contract, but there was no evidence of execution, in contravention of Financial Regulations 70.
Responding, the incumbent Managing Director of FMBN, Ahmed Musa Dangiwa, said the contract was awarded in 2011 by the previous management to design, build and implement a mortgage banking business process solution workflow and infrastructure with the aim of creating an enterprise software that will integrate all the bank’s processes.
Dangiwa added that the management after an assessment of the contractor’s performance expressed dissatisfaction with the service rendered by the contractor.
According to him, ”Management thereafter severally engaged the contractor over all the issues surrounding the project which include amongst others the issue of overpayment of the sum of N 118 million due to wrong addition of WHT to the contract award sum in all the four phases as well as other payment to the contractor. A settlement agreement was thereafter entered into by FMBN and Messr Starter-Point LTD on the mode of repayment of all outstanding due to the bank.
“Payment of the contract sum for phases three and four were made to the contract by the previous management based on the milestone achievement as specified in the contract agreement. Each payment was duly certified by the in-house consultant appointed by the bank for the project Messes Comsoft Limited. The settlement agreement between the bank and the vendor has also taken into consideration the payment made for the off-shore training that was not done by the vendor. No final payments were made by the bank on the phase four project.”
The Chairman of the Committee, Senator Mathew Urhoghide has directed the former MD, Mallam Gimba Yau Kumo and the contractor who carried out the contract to appear before the panel for further explanations.
