EFCC Alleges Misappropriation of N4.9 Billion from Arik Air Sales
Bawa Usman Kaltungo, the Director General of the Lagos Region 2 for the Economic and Financial Crimes Commission (EFCC), testified that approximately N4.9 billion from the sale of Arik Air’s assets was allegedly diverted for the establishment of NG Eagle. This diversion was purportedly at the expense of settling Arik Air’s outstanding debts.
Kaltungo made these claims during his cross-examination at the Special Offenses Court in Ikeja, Lagos State, as part of the ongoing trial involving former Managing Director of the Asset Management Corporation of Nigeria (AMCON), Ahmed Kuru, and four other defendants facing charges of conspiracy, theft, and abuse of office.
The trial includes co-defendants such as Kamilou Alaba Omokide, former receiver manager for Arik Air, and Captain Roy Iregbodu, the airline’s former CEO. Additional parties in the case include Union Bank of Nigeria Plc and Super Bravo Limited.
Under questioning from Professor Taiwo Osipitan (SAN), representing Kuru and Iregbodu, Kaltungo emphasized that financial records obtained from Arik Air’s chief financial officer, along with the EFCC’s findings, indicated that the alleged N4.9 billion was not used to settle the airline’s debts. Instead, he stated that this amount was funneled into launching NG Eagle, an airline initiated during Arik Air’s period of receivership.
Much of the court proceedings focused on the legal status of Arik Air and its assets following the appointment of receiver administrators by AMCON. Kaltungo clarified that Arik Air was initially a private company prior to entering administration, highlighting that the investigation was initiated based on a petition from the airline’s shareholders. He asserted that even while under receivership, ownership remained with the shareholders.
Kaltungo elaborated that the trustee is legally empowered to acquire and manage the company’s assets, collect rents, secure creditor interests, and oversee affairs until secured debts are resolved. He noted that the trustee administrator holds broader powers than a typical trustee, allowing continued business operations during asset management.
Allegations Surrounding Boeing Aircraft Dismantling
The cross-examination also delved into allegations concerning the dismantling of a Boeing aircraft, identified by its registration number 5N-JEA and valued at approximately $31.5 million. Prosecutors have claimed that Kuru, Omokide, and Iregbodu misused their authority by permitting the dismantling, leading to detrimental effects on both Arik Air and Nigeria’s economic interests.
However, Kaltungo acknowledged during cross-examination that the EFCC was unable to trace the proceeds from the aircraft’s dismantling to the personal accounts of Kuru and Iregbodu. While he affirmed, “no funds were traced to their personal accounts,” he maintained that the dismantling itself was illegal.
Points of contention arose when Kaltungo was presented with documents purportedly from JEM Leasing Limited, the reported original owner of the aircraft, which authorized the dismantling. He challenged the documents’ authenticity, stating they lacked the company’s official letterhead.
Reference was made to the court’s prior ruling regarding Arik Air’s receivership and a Federal High Court decision that declared such receivership illegal, before a subsequent appeal reportedly reversed this ruling. Nevertheless, Kaltungo reiterated that the situation did not alter Arik Air’s ownership structure and that the airline continued to exist as an independent legal entity.
Complications surrounding this case stem from allegations that Union Bank misrepresented Arik Air’s loan obligations when transferring them to AMCON. These initial counts claim that Union Bank made false statements about Arik Air’s loan portfolio, resulting in the transfer of N71 billion concerning alleged fictitious debt. Additionally, there are claims that Kuru, Omokide, and Iregbodu misappropriated N4.9 billion belonging to Arik Air in 2022 for the benefit of NG Eagle Limited. All defendants have pleaded not guilty to the charges presented against them.
Justice Mojisola Dada has scheduled the next hearing for July 7 to continue cross-examination of the EFCC’s witness, represented by the lawyer for the second defendant.
