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Senate Uncovers N14.7bn Proceeds of Defunct PHCN ‘Hidden’ in Commercial Banks

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The Senate has uncovered N14.7 billion proceeds of the defunct Power Holding Company of Nigeria (PHCN) allegedly hidden in commercial banks by Bureau of Public Enterprise (BPE).

Its committee on Public Accounts made the discovery in the 2017 report of the Auditor General of the Federation (AuGF) currently being considered by the committee headed by Senator Matthew Urhoghide.
The report alleged that the said sum was ‘hidden’ in commercial banks as at December 31, 2016, whereas the privatisation of PHCN was concluded in 2013.

The AuGF had in the report queried the BPE on the reported hidden account.
The query read: “Audit verification and reconciliation revealed that the sum of N14,720,396,432.43, being proceeds from the privatisation exercise of Power Holding Company of Nigeria (PHCN) was reported in the Bureau’s Trial Balance to be in Commercial Bank Accounts as at 31st December 2016.

“Whereas, the privatisation of Power Holding Company of Nigeria (PHCN) was concluded in 2013, the proceeds are yet to be remitted to Central Bank of Nigeria (CBN) Privatisation Proceeds Accounts.
“The issue has been communicated to the Bureau via letter reference No. OAuGF/RESAD/05/2016/07 dated 19th April, 2018 and no response has been received.

“Unauthorised funds kept in commercial banks may be diverted for other purposes, thereby leading to loss of revenue available for government programmes.

“The Director-General is required to recover the sum of N14,720,396,432.43 being proceeds of PHCN and remit same to CRF and forward evidence of remittance to my office for audit confirmation.”

But, the Bureau of Public Enterprise (BPE) in its written response stated “Two separate sums of N3.231,984.73 (allegedly held in Fidelity Bank Plc) and N18.199,520.87 (reported as held in Stanbic Bank Plc) are unaudited bank balances that were actually no longer in existence as at the date of the audited financial statements or asked questions, the matter would have been clarified.

“With respect to the two other bank balances N4.4 billion (Access Bank Plc) and N10.2 billion in FCMB.”
“The correct balance in Access Bank as at 31/12/16 was NIL as the bank had transferred a swelled balance of $34.1 million to the CBN domiciliary Account.

“The bank had initially been unable to make the transfer as at September 2015 as required under TSA policy, owing to the inexistence of designated USD Treasury Single Account for dollar balances
“The balance in the FCMB Bank as at 31/12/2016 was only $36,053.55 following a transfer of $65,088,198.53.

“The residual balance remained until 18/95/17 due to inability of the bank to remit as required under the TSA policy owing to initial unavailability of designated TSA for USD balances as required under the then newly introduced policy”.

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