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Aviation minister queries FAAN over N1.33 bn
loan
MATTHEW OGWUCHE (Bureau Chief, Abuja)
MINISTER of
Aviation, Mallam, Isa Yuguda yesterday hinted that government may wield the big
stick against the management of the Federal Airports Authority of Nigeria (FAAN)
for obtaining a N1.33 billion bank loan without the required approval.
The minister expressed government’s
displeasure while speaking yesterday in Abuja at a press briefing.
He said it was regrettable that FAAN "got
the loan without obtaining necessary approvals for the facilities, when it was
obvious that the banks had little or no value to offer FAAN".
More so, it came against the backdrop of
standing directives by the office of the Accountant General of the Federation
that no government agency should obtain such loans without approval or operate
more than three bank accounts, while FAAN had 12, he added.
A further can of worms was uncovered, he
revealed, when the auditors discovered that the banks charged very high interest
rates and have consequently been directed to refund N716 million being alleged
illegal charges collected from FAAN.
The banks are also to refund N675 million
pension funds and $1.37 million in their domiciliary accounts to FAAN, in line
with government’s accountability and transparency campaign, he added.
His words: "Following reports that FAAN
was not getting the best from all the banks it had relationship with, it became
necessary to appoint a firm of chartered accountants to reconcile the bank
account of the authority.
"There were evidence to show that the bank
charges were on a very high side and that these banks had little or no offer to
FAAN.
"The report of the reconciliation exercise
revealed, amongst others, that FAAN operated more bank accounts than was
approved by the government.
Said he: "Altogether, FAAN operated 12
accounts as against the approved three by the office of the Accountant General
of the Federation.
"The authority also failed to obtain
ministerial approvals for all the bank loans it took amounting to N1.33 billion
as at 30 September, 2003.
"In addition, staff pensions fund was
pledged as lieu for the loans obtained while the banks extended credit to the
authority and did not observe due diligence in granting the facilities.
"In the light of its findings, the
Chartered Accountants recommended, inter-alia that, appropriate
disciplinary actions be taken against officers responsible for taking the loans
without obtaining necessary approvals for the facilities.
"In addition, the illegal charges, which
include interest,, brokerage commissions and management fee, which amounted to
N716,626,559.43 should be refunded to FAAN.
"Furthermore, the sum of N675 million,
being funds and US$1.003,700.55 domiciliary account being held by banks should
also be recovered and credited to FAAN’s accounts.
"These recommendations have since been
approved by Mr. President and are being faithfully implemented to facilitate the
Ministry’s effort to reposition FAAN for greater efficiency and profitable
service delivery."
Speaking on other achievements of the
ministry, Mallam Yuguda disclosed that the new national carrier project is still
on, on Lufthansa and Virgin Airlines have expressed interest to be considered as
the new technical partners.
Government, he said, has directed the six
indigenous airlines approved for the West Coast and the international route to
recapitalise their equity base to N500 million and N1 billion respectively.
Government he said, has concluded
arrangements with a Russian Aviation firm to commence the construction of a
hangar for assembling helicopters in Owerri, Imo State.
Yuguda declared that additional efforts are not being
spared to upgrade airport facilities, security and power.
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