Italian prosecutors allege $1.3 billion settlement paid to Malabu oil and gas was laundered through a network of Bureaux de Change to facilitate kickbacks to former President Goodluck Jonathan, AGF Mohammed Adoke, ex-Oil Minister, Alison Madueke; ex National Security Advisor, Aliyu Gusau, ex-Sen. lkechukwu Obiorah amongst others.
Italian prosecutors are asking a court in Milan to consider arrest warrants for former President Goodluck Jonathan; two former Justice Minister and AGF, Mohammed Adoke Bello and Christopher Adebayo Ojo; two former Petroleum Ministers, Dan Etete and Alison Madueke amongst others, on bribery, corruption and money laundering charges over the controversial sale of oil bloc OPL 245, with an estimated 9.3bn barrels of crude: enough to power the African continent for seven years. The anti-corruption watchdog, Global Witness says Nigeria will lose an estimated $6bn and has been campaigning for the deal to be cancelled. The unfolding scandal also involves two former British M16 intelligence officers, the FBI, as well as current and former senior executives at Eni and Shell. The Italian and Anglo-Dutch energy giants are among 13 defendants named in the indictment. They have denied any knowledge that the $1.3bn fee they paid to the Nigerian government under then President Jonathan would be used for bribes and kickbacks. But the lead prosecutor, Fabio de Pasquale, has raided Eni offices in Italy and Shell’s headquarters in Holland that have yielded a trove of documents and emails; plus wiretapped phone conversations indicting the oil majors and now wants the court to issue a bench warrant for Jonathan as an unindicted coconspirator to testify in the case. Huhuonline.com understands that De Pasquale, who previously prosecuted and jailed former Italian PM Silvio Berlusconi, has formally notified Nigerian government through the Nigerian embassy in Rome that Jonathan, Adoke and other officials who played significant roles in securing the deal, could be subject to separate legal proceedings. Among them are: Madueke, Adoke, Aliyu, Gusau, ex-Sen lkechukwu Obiorah and ex-AGF Adebayo Ojo.
It was not clear whether the presiding judges would grant the request to issue a bench warrant for the former Nigerian president, but the Italian prosecutors argued that the legal basis for such an action is the extradition treaty signed between Nigeria and Italy in 2016 and should the Nigerian government fail to avail itself of its obligations under the said treaty, after notice is served through the embassy in Rome, Jonathan could be arrested at any European country like former Chilean dictator Gen. Augusto Pinochet, who was arrested at the London Bridge hospital in 1998 on an Interpol warrant, after he was indicted for human rights abuses by a judge in Spain. Etete, it should be recalled is already wanted in France, where he was found guilty by a court of money laundering in 2007; and it emerged he used the illicit funds to buy a Yacht and a chateau, from where investigators recovered hard cash in $100 bills that reportedly weighed as much as five tons, according to court documents.
A fish rottens from the Head
Flashback: on August 16, 2011, the Nigerian government paid Malabu oil and gas – a shadowy company, owned by Etete $1.3bn as part of an out-of-court settlement of a protracted legal fracas over OPL 245. Malabu won allocation for the bloc in 1998 during Etete’s tenure as Oil minister. The allocation was cancelled in 2001 over alleged failure by Malabu to fully pay the signature bonus, and develop the bloc within the time framework in the memorandum of understanding. After a successful bid, OPL 245 was reallocated to Shell and Agip, (which was later acquired by the Italian oil multinational company Eni). Both the Obasanjo and Yar’Adua administrations refused to compensate Malabu for the reallocation. Malabu challenged the reallocation in court and lost. Following the court’s decision, Malabu appealed. Shell also initiated a lawsuit and arbitration proceedings at the International Centre for the Settlement of Investment Disputes in Washington DC to prevent the reallocation of OPL 245 back to Malabu.
In 2010, negotiations swung Shell’s way when Jonathan, Etete’s personal friend, became president. Malabu asked the federal government to compensate it for the reallocation of OPL 245 and in exchange, it agreed to withdraw its appeal against the Federal High Court’s ruling. The federal government, the defendant in the case, decided to settle out of court rather than contest Malabu’s appeal. The government then arranged for Shell and Agip to pay Malabu $1.3bn in return for Malabu’s waiving all claims in OPL 245. Malabu was entitled to $1.1bn and the federal government a $210m “signature fee”. Shell and Eni paid the money directly to the Jonathan government, ostensibly to avoid being seen as making direct payments to Malabu or Etete – a convicted fugitive. Then Justice Minister Mohammed Adoke, claimed the Jonathan administration merely played a “facilitator of the resolution of a long-standing dispute” to demonstrate its commitment to attract foreign investment in the oil and gas sector. The standing view was that the deal rewarded abuse of office, by Etete, who ought to have been sanctioned. The Nigerian Civil Service Code forbids public servants from self-dealing; and on taking office, Ministers swear to an oath that forbids the conversion of official duties to personal advantage. Yet, Etete awarded OPL 245 to Malabu; a company he was known to have vested interests. That neither the Obasanjo nor Yar’Adua administrations charged Etete for such abuse of office reflects the kid-gloves with which they treated corruption.
The court in Milan is now weighing evidence of how Etete, awarded ownership of OPL 245 to Malabu. Etete is also accused of paying bribes to other government officials, including Jonathan, who brokered the settlement with the oil giants. The bombshell indictments claim Shell and Eni knew the $1.3bn they paid to Nigeria would be used for bribes and kickbacks, based on the content of emails presented in court by prosecutors. The e-mails suggest Shell was aware the money would end up in the pockets of Nigerian politicians. Court filings showed Shell had been negotiating with Etete for over a year before the deal was finalized. After one lunch with Etete in 2009 to discuss his asking price for OPL 245, John Coplestone, a former MI6 officer employed by Shell as its strategic investment adviser, copied Guy Colegate; another ex-M16 officer cum business adviser, on an email saying the lunch had gone well, helped along by “lots of iced champagne.” That email was forwarded to then Shell CEO Peter Voser – one of the most powerful men in the oil industry – indicating knowledge of Etete’s involvement with the deal went right up the Shell chain of command. Another e-mail from the same Shell employee said Etete’s negotiating strategy was clearly an attempt to deliver significant revenues to Jonathan as part of any transaction. Key Eni and Shell officials are also facing charges including Eni CEO, Claudio Descalzi and former Shell executive Malcolm Brinded. Eni and Shell deny any wrongdoing, insisting they paid the money to secure the exploration rights directly to the Jonathan government.
A tangled web of money laundering
Despite the frantic denials, Italian prosecutors believe they have enough evidence to corroborate the testimonies of Jonathan and other Nigerian officials to prove the culpability of Eni and Shell. Prosecutors in Milan have detailed an elaborate fraudulent scheme involving front men like, Zebulon Chukwuemeka Obi, owner of Energy Venture Partners Ltd interfacing with Eni, Shell and Nigerian government officials. According to court filings, during the final “Resolution Agreement” negotiations, Abubakar Aliyu was Jonathan’s agent, while Roland Ewubare and Oghogo Akpata represented the interests of Madueke and Gusau. Others involved in the scam include Rep Umar Bature and ex-AGF, Christopher Adebayo Ojo. The oil giants were represented by Malcom Brinded, Peter Robinson, Guy Colegate and John Coplestone.
On May 24, 2011, in total violation of the 2004 Deep Offshore and Inland Basin Production Sharing Contracts Act, Nigerian Agip Exploration (NAE) paid $1.092.040.000 into an escrow account operated by the Nigerian government at JP Morgan Chase bank in London. A week later on May 31, 2011, Nigerian authorities instructed JP Morgan to wire the money into Account A209798 at Banca Svizzera Italiana (BSI) in Lugano, Switzerland, operated by a shell company, Petrol Service Co. Ltd registered by Falcioni Gianfranco as a Malabu subsidiary. Huhuonline.com learnt that JP Morgan raised a Suspicious Activity Reports (SAR) as soon as it received the request from Nigerian authorities. The transaction also raised a red flag with Swiss banking authorities, and on June 3, 2011, BSI rejected the payment and returned the money to JP Morgan, citing Etete’s money-laundering conviction and non-compliance with bank regulations. Under money-laundering regulations, banks are required to raise SARs for highly unusual transactions, especially involving “politically exposed persons” (PEPs) like Etete.
Enter Alhadji Abubakar Aliyu
According to the 11-page indictment, JP Morgan then made a second attempt via a Lebanese bank to pay the money to Malabu, but this too was rejected. However, a fortnight later the bank was able to transfer the money, in separate tranches of $400m to two Nigerian banks, which proceeded to launder the payments as legitimate foreign exchange (forex) transfers through a network of Bureaux de Change owned by Abubakar Aliyu, who pocketed $54,418,000 as commission. The Italian prosecutors alleged that once the money entered Nigeria, Aliyu distributed the loot to politicians including Jonathan, Adoke, Madueke, Gusau and former AGF Ojo who received $10,026,280. Former Sen lkechukwu Obiorah got $11,465,000. Chukwuemeka Obi and his Energy Venture Partners Ltd received over $118, 889,000 as “facilitation fees” and bonuses in a settlement brokered by a London court after he filed a suit and blocked the accounts at JP Morgan where the funds were domiciled. In September this year, Obi and an Italian Gianluca Di Nardo requested an accelerated trial, which allowed for lighter penalties if they were found guilty. The Milan court found both men guilty and sentenced them to four years imprisonment each. The judge also ordered that $98.4 million in assets and cash be seized from Obi and $21.8 million from Di Nardo after finding them guilty of international corruption. Interestingly, the Malabu deal was concluded while Shell was under a probation order and just months after Shell had paid $30m to settle previous allegations of bribery in Nigeria. As part of that deal to spare Shell the damaging criminal conviction in that case, Shell pledged to the US Department of Justice to tighten up its internal controls to comply with America’s tough anti-corruption laws.
President Buhari is under pressure to cancel the deal and his administration has already taken steps to investigate those involved in the OPL 245 scandal. The anti-corruption watchdog, the EFCC has three pending lawsuits against Etete, Adoke and nine others, alleging impropriety over the sale of OPL 245. The EFCC has charged nine suspects, including Adoke, who has been accused of illegally transferring over $800 million, purportedly meant for the purchase of OPL 245 to Malabu; a front company owned by Etete. The Buhari government has also filed fresh charges against Shell and Eni for alleged complicity in the Malabu scandal. Adoke, Etete, Aliyu Abubakar, ENI Spa, Ralph Wetzels, Casula Roberto, Pujatti Stefeno, Burrafati Sebastiano, and Malabu were also charged. The Buhari government has approached the Federal High Court, Abuja, seeking a warrant of arrest against Adoke, who has been sojourning abroad, ostensibly on study leave. He has declared his innocence. Former President Jonathan too has denied he received kickbacks from the deal and refuted allegations he sent businessman Abubakar Aliyu, to collect his share of the loot. Italian prosecutors allege that $466m were laundered through a network of Nigerian Bureaux de change to facilitate payments to Jonathan and other politicians.
It is the rule of law, stupid!
The Malabu scandal has become a political tinderbox for the Buhari administration which has come under pressure from some quarters to halt the investigations, even as the matter is under trial in Italy. The Ijaw Youth Council (IYC) has urged Buhari to stop the Malabu investigation saying it is a witch-hunt against the Niger Delta region, because an Ijaw man was involved. IYC is questioning why only OPL 245 is being probed whereas several other blocs awarded through the same process are not facing a similar probe. But the Italian prosecutors want Jonathan to testify in open court in Milan. By brokering the payment to Malabu and Etete the Italian prosecutors argue; the Jonathan administration betrayed its complicity by rewarding a flawed process, where an oil bloc was allocated to a proxy company owned by a sitting petroleum minister, who later sold the bloc to oil majors and pocketed billions, shortchanging Nigerians in the process. The $1.3bn Shell paid Etete is more than the education and healthcare budget of Nigeria, where one in ten children die before the age of five. How are the livelihoods of 170 million Nigerians, especially the poor and hungry in the Niger Delta, enhanced when their government arranges the payment of $ 1.3 billion to a private company? Shell and Eni, not being charities, will recoup this “investment” they paid to settle the case out of court. Therefore those involved in this fraud must be made to face the law. The Italian government cannot be disparaging Nigerian migrants who are forced to flee the despondency at home to seek greener pastures abroad, while Italy’s biggest multi-national, partly owned by the state, is scamming billions from the Nigerian people.
In conclusion, whether or not an arrest warrant is issued for Jonathan, the point must however be made, and with emphasis that when the rule of law is fully operative and respected, acts of corruption and impunity like the Malabu oil deal will be contained. Corruption is a cankerworm but failure to observe the rule of law; especially by the Buhari administration is more dangerous than corruption. This is because obedience to the abiding principles of law is an antidote to all forms of corruption. A lawless society will ultimately breakdown and serve as a breeding ground for all forms of vices. Therefore, if President Buhari government takes fighting corruption seriously, he must realize that the rule of law is needed to guarantee its success. Nobody or group of persons or institution should by design or default be treated as being above the law. The money paid to Etete is income lost to Nigerians and something this shameful can only happen in Nigeria.
The dreaded public prosecutor of Milan, Fabio de Pasquale, previously prosecuted and jailed former Italian PM Silvio Berlusconi. Is he now closing the dragnet on former President Jonathan?
