After the immediate release of the illegal and unlawful arrest of Chief Dr Innocent Chukwuma OFR popularly known as Innoson by the Economic and Financial Crimes Commission, EFCC, on December 20, 2017, there have been two major publications on the Innoson vs GTBank saga. One was written by one James Osaremen and published by Premium Times on Dec 20th 2017 with the caption- Innoson EFCC arrest and the GTB Loan: The facts behind the saga. The other was published by Sahara Reporters on Dec 23rd 2017 with the caption- Innoson vs GT Bank: How Industrialist Defrauded Bank And Bullied The EFCC, The Police And Courts With his Political Connections.
The facts stated in these two publications are filled with half-truths, fabrications, false allegations and mis-representation of facts. At first we wanted to ignore and wait for the outcome of the supposed investigation by the EFCC on GTB complaint on Innoson. But in this social media era where silence may be seen as an admission of guilty as charged, we have deem it fit to present with factual evidence the true story on all the allegations raised on the two publications.
Under letter of credit transaction, in international trade, bills of ladings are consigned to Banks not because the Banks – consignees – are the owners of the goods but rather that ensures that the seller is paid and the buyer receives the goods.
Mere consignment or endorsement of a bill of lading does not confer title in the goods covered by the bill of lading to either the consignee or the endorsee. Where consignment or endorsement of a bill of lading is intended as a security for loan, consignment or endorsement in such circumstance, does not transfer title in the goods to the consignee or the endorsee: Sewell v. Burdick (1884) 10 APP CAS 74; J.F. Wilson: Carriage of Goods by Sea, 5th Edition, page 135, paragraph c.
NOTE: All Innoson’s letter of credit transactions, through GTB, were confirmed LCs. In letter of credit transactions (LC), particularly but not exclusively confirmed LC, the term is cash against documents. Shipping documents are not released by the advising/correspondent Bank to the Issuing Bank until the Issuing Bank pays for the goods. At all material times, Innoson paid 25% of every LC value before it was opened.
GTB’s LOAN TO INNOSON AND THE SECURITY
GTB never granted any loan of N2.4 billion to Innoson in 2009 but rather a loan of N500 million through its offer letter of 17th December, 2009. The last loan transaction between GTB and Innoson was in 2011. Thus, through its letter of 2nd March, 2011 GTB offered a loan of N1.7 billion to Innoson. The principle terms and security for this loan were: Legal/Tripartite Legal Mortgage over Innoson’s properties valued at N1.1 billion in 2010 by GTB appointed valuers; 25% equity contribution by Innoson on each letter of credit (LC) transaction; and shipping documents worth N500 million shall be released at any point in time to Innoson.
From the offer letter of 2nd March, 2011 the following are clear:
a. Innoson contributed 25% of the N1.7Billion. By this Innoson contributed N425Million and GTB N1Billion, 285Million;
b. the N1Billion, 285Million which GTB lent to Innoson was secured with Innoson’s properties valued at N1.1Billion in 2010 and by necessary calculation in 2011 the value of the properties were valued at over N1.3Billion.
As could be seen from the introduction above:
a. the shipping documents referred to in the offer letter of 2nd March, 2011 are at best, security for the loan and as such did not transfer title to any good covered by it to GTB. Therefore, GTB is not the owner of the goods evidenced by them and title in the goods did not pass to it.
b. since in a letter of credit transactions, shipping documents – bill of lading – cannot be released except cash (the price of the goods) is paid, for every bill of lading consigned to GTB, Innoson paid 25% of its value before it is released to GTB.
The statement by James Osaremen and Sahara Reporters that the goods belong to GTB shows that from the beginning GTB was out to defraud Innoson and this is demonstrated thus:
a. 25% of the price of all the goods were paid for by Innoson and if upon consignment the goods belong to GTB it means that GTB had taken what Innoson paid in respect of the goods. What a cheat!!;
b. Innoson gave the title documents of its properties worthing over N1.4 billion to GTB as security and denied itself the use of it.
Therefore, from the loan transaction GTB got the following:
Innoson’s N425Million contribution; and the goods.
EFCC’s INVESTIGATION IN 2011 AND THE OUTCOME
In September 2011, GTB through a letter to EFCC, alleged that Innoson defrauded it about N1.4 billion out of a loan transaction it had with it. EFCC investigated the allegation and discovered the following:
GTB stole N560 million from Innoson’s current account with it – though Innoson maintained that GTB stole N780 million from its account;
Innoson collected all the Bills of Lading consigned to GTB with the consent of GTB;
before collection, Innoson wrote letters to GTB asking it to endorse the bill of ladings to it and to pay the duties necessary for clearing the goods from the seaport;
GTB paid Customs duties for all the bill of ladings Innoson used to clear the goods, including the ones GTB claimed were forged or that the signatures of its staff thereon were forged;
GTB released all the Bill of Ladings including the one in issue to Innoson and that Innoson signed for each of the bill of Ladings in a register kept by GTB – GTB released the Bill of Lading after Innoson signed the register;
GTB failed to produce the register claiming that it was destroyed by the fire that razed its office;
after clearing each good including the ones evidenced by the bill of lading in issue, Innoson returned the foreign exchange control copies to GTB and GTB transmitted them to Central Bank of Nigeria (CBN);
a GTB staff – Mr. Okechukwu Okeke – who transacted with Innoson’s staff gave evidence that he released the bill of ladings in issue to Innoson’s staff;
The shipping company – Mitsui O.S.K. Lines Ltd. – whose ship carried the goods confirmed that the bill of ladings – including the ones in issue – were not forged and that none of GTB’s staff’s signatures endorsed thereon was forged.
Consequently, through its letter of 20th September, 2012 (copy enclosed) EFCC informed Innoson that “further to our investigation and resolve that your account be reconciled from inception, the final outcome of the Commission’s reconciliation of the account” is that you are indebted to GTB in this matter, and therein, EFCC requested Innoson to pay about N1Billion to GTB. EFCC never stated in that letter that Innoson forged any shipping document or GTB’s staff’s signatures thereon to clear the goods evidenced by the bill of ladings.
Innoson rejected and declined EFCC’s demand contained in its letter of 20th September, 2012 on the ground that GTB shall pay it interest on the N560 million at 22% being the rate at which GTB lent it money. This resulted in a stalemate and Innoson headed to the court.
JUDGEMENTS AGAINST GUARANTY TRUST BANK (GTB)
Consequently, Innoson commenced Suit No: FHC/AWK/CS/139/2012 against GTB at the Federal High Court, Akwa Division, in respect of the money GTB stole from its account claiming 22% interest thereon from the date GTB started the stealing. In this suit, GTB was represented by an eminent Senior Advocate of Nigeria. However, on 16th May, 2013 the trial Court rendered judgment in the sum of N4.7Billion in favour of Innoson against GTB.
GTB appealed against the judgment to the Court of Appeal, Enugu Division, vide Appeal No: CA/I/288/2013. In this appeal, on 9th December, 2013 the Court of Appeal ordered GTB to pay the judgment debt which then stood at about N6 Billion into an interest yielding account. (The Court of Appeal’s order is enclosed.)
Again, on the 29th July, 2011 in Suit No: FHC/L/CS/603/2006, the Federal High Court, Ibadan Division, ordered GTB – by way of Garnishee order absolute – to pay over N2 Billion to Innoson. Rather than pay to Innoson, GTB appealed to the Court of Appeal, Ibadan Division, vis – Appeal No: CA/I/258/2011. However, in a unanimous decision on 6th February, 2014, the Court of Appeal dismissed the appeal and ordered GTB to pay the ordered sum of over N2 Billion to Innoson.
Rather than pay the judgment debt to Innoson, GTB deposed in paragraphs 3 – 7 of an affidavit it filed on 12th December, 2014 at the Court of Appeal (copy enclosed) that if it pays the judgment debt, it will collapse and be out of business.
Also, interestingly, GTB commenced Suit No: FHC/L/CS/1119/2014 against Innoson at the Federal High Court, Lagos Division and thereat, through an ex parte order, frozen Innoson’s account in 18 Banks in Nigeria for 9 months. However, in a considered judgment delivered on 10th June, 2015 the learned trial Judge dismissed the suit and set aside the ex parte order.
INNOSON’S PENDING SUITS
SUIT NO: FHC/ABJ/CS/68/2014 – During the police investigation of GTB’s allegation, Innoson discovered that GTB was influencing the investigation through one Mrs Onabolu. Thus, in paragraph 12(a)-(b) of the statement of claim, Innoson averred that:
During the currency of the handwriting/signature analysis/Forensic test, the Bank through its Solicitor Mrs. Onabolu in conjunction with the 3rd Defendant were in constant communication and association with the unit or the party or person or group of persons particularly but not exclusive to Retired DSP Ayo who conducted the investigation or forensic test or handwriting analysis; and the 1st – 3rd Defendants influenced the test/analysis and its expected outcome or result;
At the trial, the Plaintiffs will rely on the call logs of calls/conversation messages between Mrs. Onabolu, the 3rd Defendant and Retired DSP Ayo through their various mobile telephone numbers which include but not limited to 08027825760, 08037018448, 08033015977, 08129131499.”
To ensure that justice is done, Innoson prayed in this suit that the court orders that the forensic examination of the specimen signatures of the persons involved be conducted by an independent body like FBI or Scotland Yard. Hence, in paragraph 4 of the writ of summons (copy enclosed) Innoson claimed thus:
“An order of mandatory injunction mandating the 1st – 3rd Defendants either by themselves, agents, privies, servants, affiliates to send the various specimen signatures they collected from parties with the one in issue to either FBI or Scotland Yard for forensic analysis/test.”
Interestingly, Innoson’s above claim which is not offensive was stoutly opposed by the GTB and the police.
CHARGE NO: FHC/L/565/2015 – This Charge was commenced in December, 2015 in this present regime and not in Goodluck Jonathan’s regime as GTB and Sahara Reporters falsely stated. At the investigating stage of the GTB’s allegations which led to this Charge, the then Inspector General of Police – MD Abubakar – was very angry and disappointed when he discovered that: there was a register kept by GTB in which Innoson’s staff signed for and collected all the Bills of Ladings including the ones in dispute and that GTB claimed it could not produce the register because it was destroyed by fire; a GTB staff – Mr Okechukwu Okeke – who dealt with Innoson’s staff in respect of the Bill of Ladings gave evidence to the police that he gave Innoson’s staff the Bill of Ladings in issue and that they signed for them in the GTB’s register. Consequently, the then IGP ordered that the case be closed and subsequently warned its men and GTB and concomitantly apologised to Innoson for the embarrassment his men caused him. He also ordered for a reinvestigation.
However, given the retirement of MD Abubakar – the then IGP – and change of guard, GTB, characteristically – convinced police officers who were not aware of the outcome of the investigation to file Charge No: FHC/L/565C/2015. Nonetheless, when the police became aware of the real and true facts and the directive of the then IGP – MD Abubakar –, it withdrew the Charge, through its notice of withdrawal dated 17th February, 2016 duly filed at the Federal High Court Registry (copy enclosed) and in the notice stated that the police needed “to further investigate the case”.
On being aware of this withdrawal, again, GTB characteristically got the then Director of Public Prosecution of the Federal Republic of Nigeria – Mr Diri – to claim to have taken over the Charge/case using the name of the Attorney General of the Federation. Interestingly, Mr Diri’s involvement in this matter and his complicities therein led to his removal as the Director of Public Prosecution of the Federal Republic of Nigeria.
INNOSON’S WITHDRAWAL OF FUNDAMENTAL HUMAN RIGHTS CASE AGAINST EFCC
On 20th December, 2017, Innoson filed Suit No: FHC/L/CS/1962/2017 at the Federal High Court, Lagos Division against EFCC and five others to enforce his fundamental human rights. Innoson commenced the application with a motion ex parte. The application was accompanied with an affidavit of urgency. As a result, Innoson’s lawyers enquired from the court’s registry when the case will be assigned and were asked to check the next day being 21st December, 2017. They did and on 21st December, 2017 were further asked to check on 22nd December, 2017 and also, they heeded to the directive.
Neither Innoson’s lawyers nor the bailiff of the court served GTB with the motion ex parte or any of the process in this suit. Moreover, the suit was commenced by a motion ex parte and by the rules and practice it is to be and shall be kept secret; and other party(ies) – Respondents – shall not be heard until the ex parte motion is determined.
Again, in its characteristic manner, GTB became aware of the pendency of this suit, got all the copies of the processes filed in the suit including the motion ex parte filed by Innoson’s lawyers. Also, GTB filed a counter affidavit deposed to on 21st December, 2017, got the suit assigned to a judge of its choice and got it fixed for hearing without Innoson’s lawyers knowing.
GTB’s lawyers attended the hearing of the ex parte application and therein disclosed the information stated above and as well started making submissions in respect thereto. As a result, Innoson’s lawyers withdrew the suit and Innoson is taking steps to get the judiciary as well as the Acting Chief Judge of the Federal High Court to investigate what happened – how GTB became aware of the suit and got all the processes filed therein that were not served on it.
EFCC’S ARREST OF INNOSON ON 19TH DECEMBER, 2017
Till date, EFCC never told Chief Innocent Chukwuma – Innoson – why he was arrested except to say on pages of newspapers that he was arrested because of his fraud at SEC and forgery of documents to obtain tax waivers.
ALLEGATION OF TAX WAIVERS
None of Innoson’s companies nor Chief Innocent Chukwuma – have forged any document to secure tax waiver. EFCC had never invited Innoson in respect of any tax waiver issue and has not investigated Innoson in respect thereof.
ALLEGATION OF FRAUD AT THE SECURITY AND EXCHANGE COMMISSION (SEC)
Again, none of Innoson’s companies nor Chief Innocent Chukwuma is involved in any security or share issue. None of Innoson’s companies is quoted at the Stock Exchange Market and Innoson does not have any company that deals on shares. EFCC never invited Innoson at any time nor investigated Innoson for any related security fraud.
JAMES OSAREMEN AND SAHARA REPORTER’S ARTICLES
From the above it is clear that:
Both James and Sahara Reporters misrepresented the facts to mislead the public; the misrepresented facts by James and Sahara Reporters are from GTB.
GTB had previously denied that it was not the reason why EFCC arrested Innoson and that it was not a party to that.
The questions arising from James and Sahara Reporters’ articles are:
i. is GTB now saying that those were the reasons why EFCC arrested Chief Innocent Chukwuma;
ii. if the answer to the question above is yes, does it not show that GTB engaged in double speaking?;
iii. if GTB double speaks, does it not portray it as an unreliable and irresponsible organisation?
BILLS OF LADING IN GTB’S CUSTODY AND STATEMENT AT THE POLICE
Who is sure that GTB did not in its characteristic manner create, generate or manufacture the Bills of Lading, no one has investigated this, given that:
Mitsui O.S.K. Lines Ltd – the shipping company whose bills of lading are in issue confirmed that the bills of lading used in clearing the goods were genuine;
Mr Okechukwu Okeke – the GTB’s staff that dealt with Innoson’s staff at all material times confirmed and stated in his extra judicial statement to the police that GTB released the bills of lading in issue to Innoson’s staff and that the release was endorsed in GTB’s register;
GTB alleged that the register was destroyed by fire.
POLICE AND GTB’S CONCEALMENT OF MR OKECHUKWU OKEKE’S EXTRA JUDICIAL STATEMENT
Yet again, in its characteristic manner and style, GTB got the police to conceal Mr Okechukwu Okeke’s extra judicial statement to the police because it is unfavourable to GTB. The Nigerian Police and EFCC have till date refused to produce Mr Okechukwu Okeke’s extra judicial statement. We therefore challenge the Nigerian Police, EFCC and GTB to produce Mr Okechukwu Okeke’s extra judicial statement and to authorize Sahara Reporters to publish it so that the whole world will know the truth. Same applies to the register – the Nigerian Police and EFCC should compel GTB to produce the register in issue.
N560 MILLION EXCESS CHARGES
Finally, with respect to N559 Million which Sahara Reporters and James Osaremen referred to and classified in their respective articles as default charges; may we invite their attention to the fact that that was litigated in Suit No: FHC/AWK/CS/139/2012. In that suit, the trial Judge came to conclusion that the charges were excess charges, unlawful and illegal. GTB was represented in that case by an eminent Counsel – Senior Advocate of Nigeria. The learned trial Judge at pages 7-8 of the judgment of 16th May, 2013 in that suit (copy annexed) held thus:
“Since any money belonging to a customer is credited to his account, and that which is paid out of the account debited as well as that which the bank earns from or through the account. In the instant suit there is nowhere the 1st Respondent have shown the reversal of the excess charges made on the account of 1st Plaintiff with it by crediting the 1st Plaintiff’s account which it debited illegally by way of excess charges. Equally no evidence is led by the 1st Defendant to show that the excess interest charges is within the Central Bank of Nigeria guideline and therefore, illegal pursuant to Section 15 of Banking Act. See First Bank of Nigeria Plc. –vs- Odaudu Uwada (2001)1 FWLR (Pt.50) 1696 at 1709, First Bank Plc. –vs- Mamman Ltd (2001) FWLR (Pt.31) 2890 at 2907.”
Maybe James Osaremen and Sahara Reporters are reversing the above quoted judgment of the Honourable Court.
Head, Corporate Affairs,