Following expectation that the ongoing audit of commercial banks by the Central Bank of Nigeria (CBN) will soon throw up more chief executives that will be made to face the law, the Economic and Financial Crimes Commission (EFCC) has started clearing its cells, mostly in Lagos where the banks have their CEOs and directors, to receive them.

The Commission currently keeps most chief executives and directors of the five banks which the CBN declared unhealthy last month, including the most famous one, Mrs Cecilia Ibru, the chief executive officer of Oceanic Bank Plc before the CBN concluded its auditing of the bank and ruptured the bubble for her.

Sunday Trust gathers that in further readiness for expected bank executives, EFCC is mobilising more security agents who will fetch those that will be indicated by the CBN, just as it is recruiting lawyers to beef up its legal department to cope with intensifying workload.

“We have much in our hands already and we will be having a lot more in the days ahead consequent upon CBN’s resolve to round up more erring bank chiefs, and we have to be ready,” a source at the EFCC said.

Mrs. Cecilia Ibru, the sacked managing director of Oceanic Bank, gave up herself to the officials of the EFCC on August 26 after days of speculation that she had fled to the United States of America to escape arrest and prosecution. The EFCC had declared Ibru and the sacked managing director of Intercontinental Bank, Erastus Akingbola, wanted when they did not report to the Commission as directed.

The Central Bank sacked the ailing banks’ chief executives following the revelation that the banks granted hundreds of billions of naira in loans that were not being paid back because of defective loan recovery measures. The CBN appointed independent chief executives to revive the sick banks and began efforts to make the sacked chief executives account for their acts and recover the huge debts that were threatening the survival of the banks.

Sources from the CBN reveal that very soon management officials of seven more banks will face the supervisory bank’s hammer and will be coming up against the EFCC.

The sources add that the bank chiefs already exposed and others to be uncovered had been perpetuating unwholesome practices for a long while. “The banks had been in trouble for years. They had been keeping the facts away from the CBN by cooking their books,” one of the sources said.

The source explained that the CBN failed to detect the lies and determine movement of cash across the banks because the CBN could only rely on what the banks submitted to it in the course of carrying out its monitoring duty. “The CBN could only evaluate the reports submitted to it; it did not have the facility to see the banks the way they were, so it was possible for the banks to make it unable to see the rot in their respective vaults,” the source added.

The source who sought to explain the seeming ease and speed with which the Central Bank was able to move against the five banks and their chief executives soon as Sanusi Lamido Sanusi became the governor, said much of the work had been done by Sanusi’s predecessor, Professor Charles Soludo. “Soludo prepared the audit on which Sanusi worked,” the source asserted.

The EFCC saw the whole mess coming. This should explain the zeal with which it is pursuing the task of getting the fingered bank executives to answer for their years in office. The Commission did an investigation last year and found out certain unhealthy deals. The chairman of the Commission, Mrs Waziri Ibrahim, called a meeting with the bank chiefs in Lagos in February, told them what she found out, and warned them to clean up their acts.

The bank chiefs were said to have confessed to her that they failed to recover the huge loans they were owed not for want of trying. “They put it bluntly to the EFCC chairman that they were facing difficulty in recovering certain loans, that their debtors would simply not pay up,” a source at the meeting revealed.

A beneficiary of the EFCC’s action that time was Bank PHB. Her intervention resulted in the recovery of N18 Billion for the bank.

That success story probably informs EFCC’s apparent belief that a little more pressure on debtors might have helped the banks to recover what they appeared to have written off as bad loans; which holds true to some extent. The Commission has recovered quite a sum since the current explosion in the banking sector occurred, although what has been recovered is like a drop in the ocean against what remains with the debtors.

Indeed, lots of Nigerians who have spoken out attribute the mess in the affected banks to recklessness perpetuated by the sacked bank chiefs, especially how they ‘lived large individually‘ and how they gave out loans with hardly any collateral.

Loans not backed by collateral became particularly common following the careless drive by the banks to make  anyone who was anything to bank with them. Patrick Fanedex, an Indian businessman, is quoted to have said that banks begged him to take loans without collateral.

Much of all this came to light in cold print last Monday when the arrested bank executives were arraigned before the Federal High Court in Ikeja, Lagos State, and heard charges read against them.

Oceanic Bank’s former Managing Director, Cecilia Ibru, was handed a 25-count charge, which include that she ‘recklessly’ granted a credit facility in the total sum of N36 Billion to Cloudy Heights Ltd on two separate occasions, N16 Billion each occasion, ‘without adequate security contrary to accepted practice,’ a total of N27 Billion to Petosan  group of companies on similar term on six occasions, N15 Billion  to Midwestern Oil and Gas Plc, N15 Billion to Circular Global International Ltd, N44.7 Billion to Ibru Edesiri Onateji  on two occasions, N30 Billion to Bliss-Bloss Intergrated Ltd on two occasions, N8.1 Billion to Midwestern Oil & Gas Plc, N15 Billion to Circular Global International Ltd, and N25 Billion to Staff Savings and Investment Trust Fund, this one for the reason that she granted the credit “against the security of Oceanic Bank International Plc’s shares.”

A breakdown of Ibru’s charges shows that she is also being held liable for failing “to take reasonable steps to ensure the correctness of the October 2008 Oceanic Bank’s monthly bank return” to the CBN. She faces the same charge for the months of November and December 2008, and each of January, March, April and May 2009.

Finbank’s former managing director, Okey Nwosu, is facing 11charges, mostly for failing to ensure the correctness of the bank’s monthly return to the Central Bank for the months of October, November, and December 2008, and then each of January to May 2009. He is also being tried for “incorrectly importing”  the sum of about N48 Billion “of commercial papers under the Expanded Discount Window in the Finbank’s statement of asset and liabilities....on or about 31st May 2009”, and N47 Billion about the same time.

Unlike Ibru and Nwosu who are facing their charges alone, the former managing director of Union Bank, Dr Bartholomew Ebong; and his Afribank counterpart, Sabastian Adigwe are being charged with two other accused persons in their respective charge sheets.

Bartholomew Ebong is joined with Messrs Henry Onyemem and Niyi Opeodu in some of the 28 charges that he faces. He and the two are being asked to answer for granting huge loans to certain business enterprises, mostly Falcon Securities Ltd which holds close to N100 Billion of Union Bank’s bad debt. Ebong is also being held for not communicating with the CBN as the law stipulates, just like his Oceanic and Intercontinental banks’ counterparts

Falcon Securities pairs with Afribank’s former MD, Sabasten Adigwe, and one Mr Peter Ololu in the charge sheet over the bank. The trio are facing 34 charges which include the familiar ones, namely granting of credit without due approval of the Central Bank.

Raymond Obieri, formerly a director with Intercontinental Bank, and the bank’s former CEO Erastus Akingbala are in the dock with several others for 18 charges, mostly of granting credit facilities to companies in which they are directors.