Investigator links Emefiele to Union and Keystone Banks

Former Central Bank Governor Godwin Emefiele has been linked to the enigmatic acquisition of Union Bank and Keystone Bank by the bank’s special investigator, Sam obazee. As a result, the government has now recommended their nationalization.

In a report seen by BusinessDay to President Bola Ahmed Tinubu, the special investigator stated that while the official Union Banks is said to be domiciled in UAE, it was realized that the entities do not have a physical presence in Dubai as claimed.

“This contravenes Section 3 (5) of the Banks and Other financial Institutions Act, 2020. Accordingly, they are not supposed to be allowed to operate or acquire a bank in Nigeria.”

As reported, “when we carried out investigation, we discovered that some persons were used as proxies by Mr. Godwin Emefiele to set up Titan Trust Bank and acquired Union Bank therefrom. All from ill-gotten wealth.”

On Keystone Bank, the investigator said in the report, “when we carried out investigation, we discovered that some persons were used as proxies with the connivance and assistance of Mr. Godwin Emefiele and the CBN to acquire Keystone Bank without evidence of payment.”

According to the report, immediately after a government organisation linked to Central Bank made a deposit of N20bn into Heritage Bank, a loan of N25bn was issued to a vehicle associated with Emefiele and this money was then put forward as payment for Keystone Bank. “Upon acquisition, Keystone Bank then returned the N25bn to Heritage Bank as placement.

“When the loan granted to the vehicle matured with outstanding balance, the MD of Heritage Bank called for repayment. Unfortunately for the shareholders of the bank could not repay.

“Consequently, the MD of Heritage got his lawyers to write to the bank on two occasions – threatening to take over Keystone Bank based on the shares they had pledged as security. After much pressure, Keystone Bank created internal loans of about N50b between June and October 2029 and moved the proceeds to repay Heritage Bank on behalf of the shareholders.”

Based on this Emefiele had mounted pressure on the bank for these loans to be crated within Keystone bank on behalf of their group. However, the MD of the bank at that time resigned due to the consistent pressure from Emefiele and the shareholders to comply.”

The investigator said, “we were able to secure some documents and investigation reports will lead to the forfeiture of the two banks – Union and Keystone Bank (along with Titan Trust Bank) to the Federal Government.”

In the course of the investigation into the sale of Union Bank, the report said “the Special Investigator contacted the Nigeria Embassy in UAE to verify the physical presence of Luxis and Magna in UAE as well as their corporate status.

“It was found that these entities do not have physical presence in Dubai as claimed.

“The Special Investigator probed into the activities of the Titan Trust Bank (acquirers of Union Bank) and discovered that there is a mysterious shareholder who has given interest free long term loan (with no fixed repayment schedule) to the entities mentioned in (1) above. This mysterious shareholder is believed to be Mr. Godwin Emefiele.”

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