AMCON’s New Law May Create Ripples In Abuja Property, Equity Market

Recent decision by Federal High Court holden at the FCT Abuja granting Asset Management Corporation of Nigeria’s (AMCON) application to take over the assets of Dr. A.B.C. Orjiako may just be the beginning of more ripples to come in both equities and property industry in Abuja.

The Corporation has since renewed efforts at recovering debts owed to it. The Order was given by Honourable Justice Taiwo O. Taiwo and issued on August 15, 2019.

By this order, banks are mandated to henceforth prevent all further withdrawals of funds and other debit transactions from the defendants’ accounts domiciled with the banks.

They are also expected to furnish the Receiver/Manager within seven days from the date of the notice with comprehensive statements in respect of each account while the order is expected to be binding and enforceable against the bank.

These financial transactions are believed to carry details of equities and properties largely domiciled in Abuja and other commercial hubs.

President Muhammadu Buhari signed a new law which empowers the Asset Management Corporation of Nigeria (AMCON) to put the bank accounts of its debtors under supervision.

It would be recalled that on July 31, Vice President Yemi Osinbajo set up a task force with a mandate to devise a strategy to recover the N5 trillion owed the corporation.

The agencies tasked to go after the debtors are the Economic and Financial Crimes Commission (EFCC), Nigerian Financial Intelligence Unit (NFIU), the Independent Corrupt Practices Commission (ICPC) and the ministry of justice.

Muiz Banire, AMCON’s Chairman, had said 20 individuals and companies owe 67 percent of the N5 trillion debts.

Ita Enang, aide to the president on national assembly matters, said the signed law – AMCON (amendment) Act, 2019, empowers the corporation to access the financial details of any of its debtors.

He said the law mandates AMCON to “Obtain access to any computer system component, electronic or mechanical device of any debtor with a view to establishing the location of funds belonging to the debtor, and to obtain information in respect of any private account together with all bank financial and commercial records of any debtor of any eligible financial institution, banking secrecy, and the protection of customer confidentiality is not a ground for the denial of the power of the corporation under this section.’’

“It makes it mandatory for AMCON to, despite the convention of confidentiality of banking, and contracting relations to furnish the federal government, ministries, departments and agencies with a list of recalcitrant debtors and then impose an obligation to seek clearance on the Federal Government, ministries, departments and agencies when the federal government, any ministry, department or agency proposes to contract with, or pay, debtors on the list furnished by the corporation.’’

According to Enang, it also stipulates that: ‘’All money standing to the credits of the corporation in any bank account is deemed to be in the custody and control of the corporation. Where any proceeding is pending in any court of competent jurisdiction by or any the corporation, the grant of any interim, interlocutory or preservative order of attachment against the corporation’s funds in any bank is prohibited.

The Corporation may require any eligible financial institution from which it has acquired an eligible bank asset or any director, manager or officer of such eligible financial institution to furnish information and produce documents, books, accounts and records in relation to any eligible bank asset acquired by the corporation from such eligible financial institution or in relation to the borrower or other obligator connected with such eligible bank asset.’’

He also said the law makes for a part-time chairman who ‘’shall be a deputy governor in the Central Bank of Nigeria to be nominated by the Central Bank of Nigeria’’.

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