Obat Petroleum in N1.2bn subsidy diversion controversy …..EFCC to investigate

Chairman, Obat Oil, Oba Frederick Akinrutan

The Economic and Financial Crimes Commission is set to investigate Obat Oil Petroleum Limited over the reported illegal diversion of N1.2b subsidy claims to the personal account of its chairman, Oba Frederick Akinrutan.

According to a document obtained by our correspondent, Petrocam Trading Nigeria Limited entered a joint agreement with Obat Oil Petroleum Limited to import some metric tones of Premium Motor Spirit (PMS) popularly known as petrol. In the agreement, Petrocam is the marketer, while Obat is the contractor.

The contractor which is Obat, hereby engaged the marketer which is Petrocam to finance the business whether by its own resources or through its Bank and Obat accept such engagement on the terms and condition in the contract both companies jointly signed.

Petrocam (Marketer) approached and got for advances to finance the business from Sterling Bank Plc, through which bank all known payment are made.

A collection account no. 0020560534, Obat Oil and Petroleum Limited with Sterling bank plc was opened to take receivables from the transaction primarily for the purpose of repaying the loans Petrocam took from Sterling bank to finance the project.

It was however gathered that Obat Oil diverted N1.2b, money meant for Petrocam to liquidate the loan it took to finance the business to its Access Bank account and later wanted to move it to Asset Management Corporation of Nigeria (AMCON) First Bank account in order to clear a debt they owe a client. Our correspondent gathered that the EFCC blocked Obat Oil from moving the money to AMCON.

Our correspondent authoritatively gathered from a reliable source in AMCON that a client which Obat Oil owe went to report them to AMCON and that is why they diverted the subsidy disbursement in order to clear the debt.
A source at the EFCC who does not want his name mention said that the EFCC will investigate the issue and charge Obat Oil to court if the allegation leveled against them is true.

Meanwhile, in a letter written to Obat Oil by Sterling Bank Plc which financed the business, signed by its General Manager Corporate, Mr. Adegboyega Adegun and Assistant General Manager, Corporate, Mr. Abiodun Odutola, the bank stated that; “we write to advice that we are aware that the Sovereign Debt Note serial number FGN/2014/01/Q14/1673 and FGN/2014/01/R14/1694 due on the joint venture transactions between Petrocam Trading Oil Limited and Obat Oil and Petroleum Limited which were financed by Sterling Bank are part of the subsidy payment approved and paid by government as published by Business Day newspaper of December 11, 2015. ”

It further stated that; “as banker of these transactions, we write to demand that all subsidy proceeds accruing to the transaction including exchange rate differentials and all other relevant claims from government must be remitted to Obat Oil and Petroleum Limited account number 0020560534in Sterling Bank Plc for the purpose of liquidating outstanding loan obligations in line with the terms and conditions of the facility under which the transactions were financed. Also note that apart from financing the importation product, Sterling Bank paid all relevant government charges including the PEF and admin.”

In a response to the text message our correspondent sent to the Chairman of Obat Oil, Oba Frederick Akinrutan, an official of Obat Oil who called himself Otunba said that the allegation of Petrocam is in violation of the court process since the case is already in court.

 He added that the legal counsel of Petrocam had advised the company to have account reconciliation meeting on Januaru 9, 2016.  However, he could not provide the letter.

“We are shocked to hear that the story has been reported to the press since there is opportunity for both parties to iron out area of concern,” he lamented.

When asked by our correspondent whether they truly diverted the N1.9b subsidy claims to their account, Otunba failed to answer the question.
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