Thursday, July 31, 2008

Nigeria - Nitel fraud

Nigeria: Pentascope Was a Fraud - Senate

The Senate Committee on Communications yesterday declared as "fraud" the deal that led to the sale of Nigeria Telecommunication Limited (NITEL) to Pentascope, just as it vowed to take drastic measures against anybody who was involved in the sale.

The committee also alleged that barely six months after NITEL was acquired by Pentascope, it took a loan of N40 billion from the banking sector, about N13 billion in treasury bills and Pentascope could not make the N59 billion it was supposed to have made during that period.

Chairman of the Senate Committee on Communications, Senator Sylvester Anyanwu, told Senate reporters that those that committed the fraud at NITEL through Pentascope, are now re-grouping to take over the giant communication outfit again.

According to him, "Since then we've been getting information, we've been gathering information, on what happened. NITEL under Pentascope and the process by which BPE sold NITEL to Pentascope was terrible.

"Why I am talking to you now is that a lot of people who were part of this are now also putting themselves together trying to go through the back door to take over NITEL, especially financial institutions. Let me give you an example, NITEL under Pentascope in less than six months borrowed N40 billion from the banking sector.

"They have more than N13 billion in treasury bills. I'm not even talking about even the N59 billion we have supposed to have made within that period. These things we want to probe.

"When BPE sold to Pentascope, which was registered on a public holiday by only two men as a company, by two young consultants and then when they saw that they couldn't run it wrote to the President that the company could not do it after they have squandered all the money. That was the time when the question of bringing in TRANSCORP came up."

He continued, "So much happened in NITEL and Nigerians were totally short- changed. And we think it is the responsibility of the legislature to ensure that those who killed NITEL do not go scot-free. Nigeria made too much investment in NITEL to let it go like that. It is not a witch-hunt.

"We must begin to ask questions because that's the only way we can move forward. It will be continuous because if they do such things and get away with it without anybody asking questions, it will be business as usual and tomorrow he becomes a warlord having short- changed the country. It's a terrible thing.

"All we are trying to do is quietly; we have been doing some investigations and getting a lot of information about what has happened in NITEL from 1999 if possible. But the worst era is the period of Pentascope getting involved in NITEL. It was a total, complete fraud."

The committee also alleged that there was a lot of illegality in the billing system of NITEL, stressing, "Let me tell you, even NITEL workers, the worst that is going on now is illegal connection on the interconnectivity.

Because NITEL has no billing system, the guy who is in charge of finance in NITEL office sits down and writes a bill and gets himself or herself sorted out.

"What is supposed to come into NITEL is not coming to NITEL. The workers are not being paid. They are being owed for a series of months while a few individuals are making away with the nation's wealth. It's serious. We have discovered so many facts, including those people you cannot believe-all these big, big guns, oil companies, banks … they are all using NITEL facilities but they are not paying a dime.

"We are going to deal with all that because we got the information (about people who use fronts) about these people. Some of them go to the third party who are even outside this country and get these services from these third parties and every day what I hear is that NITEL owes me, NITEL owes me. How does NITEL owe you?

"NITEL has less than 100,000 lines working. How much can NITEL owe you on interconnectivity? And the troublesome part of this issue is, do you know the volume of traffic that goes out of this country every day on international calls and those coming in? Have you wondered how these calls are being settled?

"Because we don't have a billing system we don't even have a way of knowing how much to bill because of the inefficiency of NITEL staff and we keep passing the buck and even government officers aiding and abetting this fraud.

"What I will advise those who want to come through the back to buy NITEL is that we are not going to fold our arms to let this company go under.

"Where were these financial institutions, where were the auditors who were auditing NITEL at the time? NCC has its own question to answer. At the time, BPE was responsible for the sale and privatization of all the government parastatals, including NITEL.

"The regulatory body will have its own questions to answer. But what I am worried about is that some of these financial institutions who are now putting resources together under the pretext that NITEL is owing them and therefore they want to clamp down on NITEL, they were part and parcel of what happened.

"Government is not going to allow them, otherwise we are going to expose all of them because we have some information; this is a very serious issue.

"And I tell you, as soon as the Senate reconvenes there will be a very serious public hearing on this issue. We will not fold our arms as legislators and allow NITEL to go under."

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