73,000 ghost accounts used in Nigeria pension scam

Investigators in Nigeria have traced stolen pension funds to well over 73,000 phoney bank accounts opened by corrupt officials of two federal pension departments.

The fictitious accounts opened with the help of conniving bank staff served as conduits through which millions of dollars of pension funds were funnelled into private pockets.

Following a Senate probe of alleged corruption in the management of pension funds, six key civil servants have been arrested for stealing $218.7 million from the Nigeria Police Pension funds.

They include a Permanent Secretary Atiku Abubakar Kigo and top senior officers in the Federal Civil Service, Esai Abubakar; Ahmed Inuwa Wada; John Yakubu Yusufu; Mrs Veronica Ulonma Onyegbula; and Sani Habila Zira.

Falsified documents

The civil servants are accused of looting $160 million of the police pension fund through falsified documents. They had withdrawn the said amount from the Budget Office for a pension payment that required just $23.3 million.

Investigators also revealed that whereas $33.3 million was paid to the Office of the Head of Service monthly for pension payments only $12.7 million was actually required. While 141,790 pensioners were registered and listed on the government’s payroll, only 70,657 were genuine pensioners.

In addition the Police Pensions Office received $33.3 million every month as pension claims for police pensioners; it actually needed only $3.3 million. It was gathered that illegal withdrawals were made by staff using multiple cheques in fictitious names in excess of 30 cheques per day to withdraw cash from their bankers amounting to over $93.3 million.

Buckling under interrogations an employee of the Police Pension Office has turned in $6.7 million in cash while another civil servant surrendered three luxury estates with about 27 blocks of deluxe flats he built in Abuja.

Expunged from payroll

A staggering $13.3 million in cash was recovered from a house belonging to another civil servant, while hotels and gas stations belonging to yet another staff member of the pension office have been confiscated by the EFCC.

In a memorandum sent to the Senate Committee on Establishment, Public Service Matters and Management of Pension Funds, the National Union of Pensioners had complained that legion of ghost pensioners receive monthly payments through bank transfer, while names of genuine pensioners were expunged from payrolls.

According to the pension union names of many pensioners have been deleted from the pension payroll since 2002 while efforts to put their names back were routinely frustrated.

The union further averred that the office of the Head of the Civil Service of the Federation, responsible for the payment of pension of federal retirees as well as remitting statutory contributions from the Federal Government to state pensioners, was responsible for most of the scams experienced with the pension fund.

Gone into hiding

Chasing the pension loots the Economic and Financial Crimes Commission (EFCC) arrested a Deputy Director of Finance in the Federal Civil Service, Mrs Piana Chidi, in whose bank account $5.3 million was discovered.

Mrs Chidi was arrested at the Sheraton Hotel Abuja having gone into hiding following arrests of some of her partners in crime. A breakdown of the cash in her bank account showed that she has $3.3 million in local currency and $2m in a domiciliary account.

Other civil servants in Mrs Chidi’s syndicate include Danjuma Bako-Wasa, Luke Eloanyi, M.A. Abdalla, Aliyu Bello and Ms Grace Francis. EFCC investigators uncovered that Bako-Wasa operated a different bank account using the alias Haruna Megida.

In less than a year, Bako-Wasa allegedly paid $140,000 into one bank account, just as $53,000 was discovered in a separate account traced to him. Similarly, the EFCC traced $80,000 to Ms. Francis’ account while Eloanyi, a confidential secretary, has $87,000 stored in his account. The EFCC disclosed that in one instance, 554 ghost pensioners drew pensions from one bank account.

The EFCC has also disclosed that several bank officials opened accounts and made them available for a percentage fee to receive proceeds of fraud from the Office of the Head of Service of the Federation.

Non-existent

One bank manager aided a civil servant to launder $13.3 million using non-existent companies. Another banker brazenly rented out different accounts belonging to his friends, wife, mother-in-law and siblings to crooks to receive pension arrears and gratuities.

A female member of the Nigeria Youths Service Corp (NYSC) who left university only a few months ago received in her account $60,000; $84,000 and $92,000 respectively as pension from the office of the Head of the Civil Service of the Federation.

EFCC operatives also discovered that a company that produces nothing but which bank account received substantial payments as pension had a turnover of $3.7 million. A mysterious UBA (United Bank for Africa) account was found to hold $24.7 million meant for police pensioners.

Anti-climax

The huge sum was deposited same day the account was opened, in the names of Adamu Salihu and another holder, initialled as “D.G”. In what is an obvious anti-climax, the Pension Reform Task Force, set up by the Presidency to reform the pension system has been found to be mired in corruption.

The Head of the task force, Abdulrasheed Maina was found to have spent $1.6 million on a biometric exercise and sponsoring 85 officials on a foreign trip to verify less than 20 retirees living overseas.

Another $1.5 million was spent on local bio data to verify the same pensioners. Maina is also accused of depositing huge pension funds into the bank account of his younger brother with the account attracting a monthly interest of $667,000.