Posted by The Punch on
Cash-strapped All States Trust Bank has N12billion belonging to the Ministry of Police Affairs, as well as deposits of several members of the House of Representatives trapped in its vault.
Cash-strapped All States Trust Bank has N12billion belonging to the Ministry of Police Affairs, as well as deposits of several members of the House of Representatives trapped in its vault.
The bank had lately come under the hammer of the Central Bank of Nigeria, following which its board was replaced with a new one over its alleged involvement in money laundering.
The Economic and Financial Crime Commission is investigating the last Management of the bank, among others, for acting as conduit for money laundering by Bayelsa State Governor, Chief Diepreye Alamieyeseigha, who is being tried in London.
The news of its involvement had caused both public and private depositors to engage in panicky withdrawal, resulting in the bank's inability to meet cash demand.
The bank was penultimate Thursday thrown out of the Clearing House due to its inability to meet depositors' withdrawal demand.
But the Chairman of EFCC, Mallam Nuhu Ribadu had last week, during a public engagement, assured depositors of the safety of their money.
However, the Ministry of Police Affairs, whose N12billion of its funds for recurrent and overheads was trapped in the bank is unable to pay staff salaries and meet its other recurrent overhead expenditure, bringing activities in the ministry to standstill.
A source close to the Ministry informed Sunday Punch on Thursday that, the Minister, Chief Brodrick Bozimo had written to President Olusegun Obasanjo and verbally informed the Chairman, House Committee on Police Affairs, Hon. Emmanuel Bwacha, to seek their intervention in freeing the trapped funds.
"As I talk to you now, the ministry cannot meet its overheads, including salaries and allowances because of the N12bilion that is trapped in All States Trust Bank. The Honourable Minister has written to Mr. President over the issue and he was directed to see the CBN governor, who has promised to do something" the source said.
He added that, "The CBN has this week written a letter to us directing that the ministry should open an Account with Zenith Bank into which they will transfer the funds."
It was also gathered that an enquiry may have been ordered by The Presidency to determine whether officials in the ministry were influenced by extraneous circumstances to continue to maintain such huge deposit with the bank, in spite of concerns about unhealthy practices by the bank raised by some ministry officials.
The former Chairman of the bank, Chief Ebitimi Banigo is believed to be from the same geo-political zone as some key ministry officials.
This same enquiry, Sunday Punch investigations revealed, is being extended to the Ministry of Labour and Productivity, whose funds were trapped until last week.
Confirming this development, Honourable Bwacha informed Sunday Punch during an exclusive interview on Thursday that, he was verbally informed of the ministry's predicament by Bozimo, but declined to say how much of the ministry's funds were trapped in the bank.
According to Bwacha, "Well, you have said it all, that the minister wrote to the President. As Chairman of the Committee on Police Affairs, I am aware. The minister had actually informed me verbally. I am not aware of the specific amount. I know that police money is being trapped in All States Trust Bank.
"I know they are making efforts to retrieve this money, this the minister confirmed to me. I also know that the Speaker too had been making effort to ensure that this money is retrieved," he added.
He, however, allayed fears that the trapped money may adversely affect the successful implementation of the year 2005 budget, saying, " the amount trapped in All States Trust Bank appears to be money for salaries. I am not sure it is money for capital project."
Bwacha further revealed that some members of the House of Representatives, including himself have their deposits trapped in the cash strapped bank, saying, " There are some members of the National Assembly whose money is being trapped. In fact I am even one of them."
He also described the 25billion bank capitalization directed by the CBN as capable of putting banks in a better footing and averting future occurrences.
"I am aware that the policy of N25billion bank recapitalization by the CBN is a very good idea that would put every bank in a good footing. At the end of the day, we would have financial institutions that you would have cause to do business with and when you save your money, you can go and sleep with your two eyes closed," he said.
SUNDAY PUNCH, October 16, 2005