UK Court Rules Against FG Over Malabu Oil Dispute

The Federal government of Nigeria has in a judgement delivered in the United Kingdom lost its $1.7 billion claims against JP Morgan Chase Bank over the disputed transfer of proceeds from the sale of OPL 245 in 2011.

in a report from Sahara reporters, Nigerian government had sued JP Morgan on the grounds of “Quincecare duty”, alleging that the bank “ought to have known” that the sales transaction of 100 per cent in OPL to Shell and ENI for $1.1 billion was garnished with corruption and fraud.

The Nigerian government has lost its $1.7 billion claims against JP Morgan Chase Bank over the transfer of proceeds from the sale of OPL 245 in 2011
The Nigerian government has lost its $1.7 billion claims against JP Morgan Chase Bank over the transfer of proceeds from the sale of OPL 245 in 2011

The Malabu scandal which involved the transfer of about $1.1 billion through the Nigerian government to accounts controlled by a former Nigerian Petroleum Minister, Dan Etete.

From accounts controlled by Etete, about half the money ($520 million) went to accounts of companies controlled by Aliyu Abubakar, popularly known in Nigeria as the owner of AA oil. Anti-corruption investigators and activists suspect he fronted for top officials of the Goodluck Jonathan administration as well of officials of Shell and ENI.

The transaction was authorized in 2011 by ex-president Jonathan through some of his cabinet ministers and the money was payment for OPL 245, one of Nigeria’s richest oil blocks. This has caused an underdevelopment of the oil resources of the OPL 245 license since the controversies began.

In the recent judgement delivered by the Business and Property Courts of England and Wales Commercial Court on Tuesday, it was said that there were no proof that Nigeria was defrauded in the deal.

the Judge, Sara Cockerill stated that by the time of the 2013 payments, the bank was on notice of a risk of fraud, Bloomberg reports. “There was a risk – but it was, on the evidence, no more than a possibility based on a slim foundation.

“The Federal Republic of Nigeria is naturally disappointed by the outcome of the judgment and will be reviewing it carefully before considering next steps.

“The FRN will continue its fight against fraud and corruption and to work to recover funds for the people of Nigeria.

“This judgment reflects our commitment to acting with high professional standards in every country we operate in, and how we are prepared to robustly defend our actions and reputation when they are called into question,” JPMorgan said in a statement.

in an earlier argument, The Nigerian government argued that there were enough “red flags” for JP Morgan to have halted the transfers.

However, the bank rejected Nigeria’s claims, maintaining that all due processes were followed and money laundering checks were done, arguing that allegations of fraud only came up after a new government took over in Nigeria.

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