FG probes 21 banks over Federation Account remittances

Coordinating Minister for the economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala
| credits: File copy

The Federal Government on Thursday empowered 53 consultants to verify remittances to the Federation Account by the 21 banks hired by the Federal Inland Revenue Service and the Nigeria Custom Service.

The verification and reconciliation exercise will cover a period of four and half years beginning from January 2008 to June 2012.

Inaugurating the consultants in Abuja on Thursday, the Chairman, Revenue Mobilisation, Allocation and Fiscal Commission, Mr. Elias Mbam, said the lead consultant was expected to submit the final report on August 15.

Mbam said the exercise became imperative following irregularities in the remittances of revenue from collecting banks engaged by FIRS and NCS, which were observed by the Non-Oil Monitoring Committee and Mobilisation Department of RMAFC.

He said, “The commission made a presentation to the Federation Account Allocation Committee, which at its meeting held on March 9, 2012, approved that the commission should engage consultants to verify and reconcile revenue collection by the banks for both the FIRS and NCS in order to recover any excess deduction and stop further leakages.

“The commission, after following due process in line with the relevant provision of the Public Procurement Act, 2007, appointed a lead consultant and 52 other consultants to carry out verification and reconciliation exercise covering January 2008 to June 2012.”

Mbam said the exercise did not constitute an audit of the country’s revenue collecting agencies, but was aimed at ensuring that the collecting banks complied with the terms of their agreements with FIRS and NCS.

He disclosed that the office of the Accountant-General of the Federation had been advised to open a special account with the Central Bank of Nigeria into which recoveries during the exercise would be lodged.

From this account, he said, the consultants would be paid their professional fees, while the balance would be remitted to the Federation Account for distribution to the three tiers of government.

The RMAFC boss said, “This exercise requires the cooperation of both FIRS and NCS. It is, therefore, pertinent for me to commend the two agencies for their cooperation so far. I have no doubt in my mind that the cooperation will continue until the completion of the exercise.

“I wish to appeal to the lead and collecting banks with consultants to ensure a very successful exercise, which is to promote transparency, efficiency and accountability in the business relationship between the banks and government.”

Mbam justified the large number of consultants employed for the exercise because of the need to complete the assignment on schedule as it would take too long for very few consultants to handle the task.

“All the 21 banks are collecting banks for the FIRS and NCS, and they have branches all over the country. As a result, RMAFC has distributed consultants to specific banks and FIRS and NCS to stop these leakages,” he added.

The lead consultant for the exercise is J K Consulting, a firm belonging to a former Accountant-General of the Federation, Mr. Joseph Nayeju.

Among the other 52 consultants that will carry out the verification exercise beginning from June 3, 2013, is PriceWaterhouseCoopers.

While the lead consultant will supervise and coordinate activities, the other 52 will reconcile all the flow of revenue from collecting banks to the lead banks.