Name: Wahab Gbadamosi
Email: baauswat@yahoo.com
City: Abuja, Nigeria
Date: December 22, 2008 1:05:53 pm
“NO CHEVRON TAX MONEY WAS DIVERTED”-FIRS
RESPONSE TO LIBELLOUS AND DEFAMATORY PUBLICATIONS AGAINST THE EXECUTIVE CHAIRMAN, FEDERAL INLAND REVENUE SERVICE, FIRS, SOME DIRECTORS OF THE FIRS AND UNNAMED CBN OFFICIALS
The attention of the Federal Inland Revenue Service (FIRS) has been drawn to the libellous and defamatory publication on the front page of the National Mirror of Friday, 28th November 2008 captioned “FIRS Chairman in N36bn Fraud”. In the said publication, the Executive Chairman of the FIRS, Ifueko Omoigui Okauru and some officers of FIRS namely: M.A Dike, E.A Sulu and H.A Ilo alongside unnamed officials of the Central Bank of Nigeria (CBN) were alleged to have engaged in looting and criminal diversion of government revenue to the tune of over 360 million US dollars (N36 billion) by remitting only $131 million out of the sum of $491,509,203 recovered from Chevron Group of Companies. The publication is said to be sequel to a petition dated 17th November 2008 and addressed to the Chairman of the Economic & Financial Crimes Commission (EFCC).
This petition submitted to the EFCC, is now believed to have been widely circulated in the media resulting in the publications, starting with National Mirror of November 28. Other publications in the Sunday Mirror of 14th December, 2008 and the National Eye and Daily Independent both of 15th December 2008 repeated the same story albeit in different forms and guises. We understand the same news item has been carried by the electronic media on television and radio at various times.
Considering the antecedents of the petitioner, the FIRS would have completely ignored the mudslinging efforts of the authors of the publications but for the gross distortion of facts and outright lies being peddled in the said publications. However, we recognise and accept that we owe Nigerians a statutory responsibility and sacred duty to correctly inform them on the matter and set the record straight, particularly in the face of misinformation and falsehood being published in newspapers.
The FIRS wishes to state as follows:
ABZ INTEGRATED LTD, MR. FIDELIS UZONWANNE AND FIRS
1. Sometime in 2003, the EFCC apparently engaged Mr. Fidelis Uzonwanne of ABZ Integrated Ltd as an informant based on his allegations of tax fraud against a number of oil companies including Chevron, and his promises to assist the EFCC recover alleged unpaid taxes for the government.
2. It would appear that by 2005, the relationship became strained due to the refusal of the EFCC to pay him some commission.
3. When it became clear to Mr Fidelis Uzonwanne that EFCC would not pay him, he then, through his ABZ Integrated Ltd, wrote an open letter to the President published in the ThisDay Newspaper of Friday July 1 2005 alleging that the EFCC, FIRS and CBN conspired with Chevron to evade $10.8 billion tax.
4. This letter triggered various responses from the National Assembly, Chevron Nig Ltd, EFCC and the Nigeria Extractive Industry Transparency Initiative (NEITI).
5. The National Assembly conducted a public hearing on the subject of the petition. Relevant parties including the CBN, EFCC, Department of Petroleum Resources (DPR), Office of the Accountant General of the Federation and the FIRS appeared and made presentations at the hearing. The report of this public hearing is still being awaited.
6. Chevron issued a press statement on August 3, 2005 (www.nigeriantimes.blogspot.com/2005/08/chevron-nigeria-and-efcc-refute.html) and also reported Mr. Uzonwanne to the Accountants investigating panel of the Institute of Chartered Accountants of Nigeria (ICAN) for professional misconduct.
7. EFCC accused Mr. Uzonwanne of blackmail in a press statement signed by Medard Ehimika of the Media and Publicity Unit:
”The 'Bounty Hunting' mentality of ABZ is highly condemnable as it borders on cheap blackmail. Members of the public are therefore advised to be wary of Mr. Fidelis Uzonwanne who has perfected a scheme as a rabble rouser by making wild allegations of tax evasion and fraud against companies in order to blackmail them. We have recently discovered his antecedents in blackmailing and intimidating government officials and agencies as exemplified in his past relationships with FIRS, Education Tax Fund (ETF), the Nigeria Police and the Office of the Accountant-General of the Federation.”
8. On August 9, 2005, NEITI convened an extra-ordinary general meeting to discuss what it described as “severe and wide-ranging tax evasion allegations against the Chevron Group by Mr. Fidelis Uzonwanne of ABZ Integrated Limited.”. It subsequently issued a press statement (www.neiti.org.ng/Press%20Releases/pressstmt-taxevasion.pdf) published in Thisday Newspapers of August 17, 2005. Amongst others, NEITI noted the following:
“that Mr. Uzonwanne had less than a clear understanding of the operations and fiscal regime prevalent in the Nigerian oil and gas sector, particularly as regards the tax treatment of some categories of expenditure, tax incentives for gas utilization project and such like; and that he failed to seek clarifications from the relevant agencies like the FIRS before concluding that a pattern of illegal behaviour by Chevron existed”.
“the NSWG was persuaded that some of the allegations by ABZ against Chevron would require some more detailed expert enquiry, the nature of which the ongoing financial and process audit commissioned by NEITI should resolve. therefore the NSWG undertook to make all information that ABZ provided at the meeting to all the NEITI independent auditors currently auditing the Oil and Gas companies in Nigeria as well as the CBN, NNPC, NAPIMS, DPR, Office of the Accountant General of the Federation and the FIRS.”
9. No interaction between the EFCC and the FIRS took place on this matter or similar matters until the EFCC indicated in a meeting and a letter in August 2008 asking FIRS and the States Internal Revenue Service (SIRS) to pay for consultants hired by the EFCC.
10. Not too long after that, in September 2008, the EFCC wrote to the FIRS requesting additional information as provided by the lawyers to Mr. Fidelis Uzonwanne regarding non-payment of professional fees. The FIRS has responded to the EFCC, that it had no intention of paying ABZ on the grounds that it had no contractual relationship with ABZ and could not pay for services it did not contract.
11. Because of FIRS's insistence that it will not pay for services not rendered, and having failed to secure payment, consistent with his usual unethical behaviour, Mr. Fidelis Uzonwanne has now fabricated a new story that $360m out of the sum of $491.5m recovered from Chevron purportedly through the efforts of his ABZ Integrated Ltd had been diverted. This is not true. Neither Mr. Fidelis Uzonwanne nor his company ABZ Integrated Ltd - recovered any tax monies from Chevron for the FIRS. The EFCC also acknowledged this fact when it stated in a press statement that “EFCC made it clear that he (Fidelis Uzonwanne) did not deserve a kobo as the recovery was not directly attributed to him”.
12. The real issue that Mr Fidelis Uzonwanne has with the FIRS (and for which he has engaged in this war of attrition) still remains the refusal to pay him for services not contracted nor rendered. It should be noted that the sum of $6,516,644 paid by Chevron in 2004, on the basis of which it would appear Mr Fidelis Uzonwanne’s ABZ Integrated Ltd is seeking to be paid commission, was part of an assessment which had been in dispute since December 2001 before ABZ Integrated Ltd surfaced with the petition in 2005. The payment of $6,516,644 by Chevron had no connection with Mr. Fidelis Uzonwanne or ABZ Integrated Ltd's efforts.
PAYMENT PROCESS FOR PETROLEUM PROFITS TAX (PPT)
The payment of PPT comes in three forms namely:
*Monthly instalments based on Estimated Tax Returns;
*The Final Tax (13th month instalment) based on audited financial statements; and
*Additional tax arising from desk audits, field tax audit and tax investigation exercises.
All PPT payments are in US dollars and payable into offshore accounts opened by the CBN for that purpose. To make any payment, the taxpayer:
*Instructs his bankers to transfer the amount of the tax into the CBN offshore account;
*Notifies the FIRS in writing that a specified amount had been paid into the account;
*Upon the relevant offshore account being credited with the tax payment, the CBN notifies the FIRS that tax payments have been received;
At month-end, a copy of the bank statement showing all tax received into the account for the month is obtained from the CBN;
Upon the receipt of CBN's credit advice/bank statement, FIRS matches the company's notices with CBN credit advice/entries in the bank statement and then issues receipts.
From the above, it is very clear that no officer of the FIRS has any access to these accounts. The FIRS has always operated a secured PPT payment process that would not allow for diversion of payments.
MR. FIDELIS UZONWANNE
The brain behind the petition and its publication is Mr. Fidelis Uzonwanne who is a known professional petition writer and blackmailer.
Mr. Fidelis Uzonwanne who is at present facing charges of professional misconduct by the Institute of Chartered Accountants of Nigeria (ICAN), wrote the FIRS on 3rd June, 2008, applauding the FIRS as follows:
“We are aware that FIRS is in the forefront of the fight against corruption and upholds transparency in its dealings. We respect these attributes.”
By November 17th 2008 when it was increasingly apparent that the FIRS would not pay Mr. Fidelis Uzonwanne, he resorted to mischievously accusing the FIRS of fraud and corruption.
This is a practice he has demonstrated overtime as the following instances will show:
a. In December 1994, the FIRS terminated the contract of U. F. O. Associates' Limited of which Mr Uzonwanne was the Managing Director because of observed unethical practice. After the termination of the contract, U. F. O. Associates put up a claim for monies which had no bearing to work done. In 1995, Mr. Fidelis Uzonwanne was paid the sum of Two Million and Seventy Eight Thousand Naira (N2.078M) in final settlement;
b. A few months later, he submitted claims ranging from Seventeen Million Naira (N17 Million) to One Hundred and Twenty Four Million Naira (N124 Million) and petitioned the then Honourable Minister of Finance requesting for payment of commission for services rendered to the FIRS. His claims were determined to be frivolous and baseless.
c. In early 2000, Mr Fidelis Uzonwanne petitioned the Federal Government again claiming unpaid commission. After a review of his petition, the then Minister of State of Finance did not only declare his petition baseless, he stated that it was a distraction and avoidable.
d. At the same time, in 2000, Mr Fidelis Uzonwanne made spurious allegations about “conspiracy, forgery, and theft of Forty billion naira (N40 billion) in Education Tax against the FIRS” in the February 2000 edition of Crystal Magazine. The allegation was thoroughly investigated by a panel set up by the Federal Government of Nigeria. His allegation was found to be false and it was determined that no tax money was missing.
OUR ASSURANCE
We restate that the allegations contained in the petition as published in the newspapers are malicious, baseless, unfounded in truth and a figment of the author's imagination all in a quest to blackmail the FIRS into paying Mr. Fidelis Uzonwanne of ABZ Integrated Ltd., a consultancy fee for an alleged service claimed to have been rendered to the EFCC.
We wish to assure the Nigerian public that no such looting and criminal diversion of funds was committed by any officer of the FIRS including its Executive Chairman; and that no revenue of the Federation Account was missing as alleged by the newspaper publications.
AFAM OKIYI
Head, Corporate Communications
Federal Inland Revenue Service (FIRS)
