Financial Reporting Council in N66m Rent Fraud


… used 64 vouchers to collect N28 million 
 

Senate panel on Public Accounts has unravelled a fraud in the payment of a two years rent to the tune of N66 by Financial Reporting Council of Nigeria without occupying the property.
Also,  the Committee chaired by Senator Mathew Urhoghide also uncovered another fraud by the agency when it used 64 vouchers to siphon N28 million. 
These fraudulent payments using government’s fund occured during the tenure of Jim Obazee as Executive Secretary of the Council. 
Obazee as the Execuive Secretary then was the principal actor in the controversial exit of Pastor Enoch Adeboye as the General Overseer of the Redeemed Christian Church God, RCCG, Nigeria.
The Council is responsible for setting and promoting compliance with standards for accounting, financial reporting and auditing in Nigeria, under which it created its controversial Code of Corporate Governance.
The breakdown of the N66 million showed that the FRA paid N42 million for rent and N23.4 million as legal fee. 
The query reads in part, “It was observed that, on 21/11/16 the sum of N42 million  was paid as rent to Japaul Oil and Maritime Services for an office space at Japaul Building. N23.4 million was paid to SolaOluseyi & Co, as legal and agency fee for the office space, making a total of N66 million for two years ending 1/1/2019. 
“The Council is yet to move into the building, twenty (20) months running with 4 months to its expiration. This anomaly was due to the failure of the Executive Secretary to exercise due diligence in the application of public funds by ensuring that value is received for money expended. 
“The Council carried out expenditure of such magnitude and yet fail to receive value. The whooping sum of money was paid for rent by the Council, yet failed to occupy the building, this amounts to waste of government resources. 

But,  the Finance Reporting Council in its written response said, “Upon the acquisition of the office accommodation at the Japaul House, there was need to give the property a face-lift including partitioning befitting of an office. However, there was change of Executive Secretary in 2017, which slowed the process of award of contract. Secondly, the Landlord was not willing to renew the tenancy agreement after the expiration of the current agreement. 
“The Management further remarked that, the Council is taking steps to utilize the building and secure a further lease from the Landlord.

Auditor’s Evaluation


It was further gathered that the former Executive Secretary has an interest in that particular building paid for by the Financial Reporting Council. 

Also in yet another query which reads, “During the audit, it was observed that sixty four (64) payment vouchers for the sum of N28,765,842.11 (Twenty eight million, seven hundred and sixty five thousand, eight hundred and forty two naira, eleven kobo) were raised and paid without the Internal Audit stamps and dates, in contravention with the provisions of extant laws and regulations.

” This infraction was due to the failure of the Executive Secretary to strictly comply with the provisions of law and laid down procedures aimed at the strengthening the internal control system in government agencies. Payments arising from vouchers not preaudited cannot be accepted as judicious charge against public funds.”

The Chairman of the Committee however ordered the former Executive Secretary to return N94 million fraudulently collected to Federation Account.

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