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Court bars EFCC, Providus Bank from arresting Rexglobe CEO over N3.4 billion loan dispute


The Federal High Court, Abuja, has restrained the Economic and Financial Crimes Commission (EFCC) and Providus Bank Plc from arresting the Chief Executive Officer of Rexglobe Fuel Services Limited, Chukwunonso Cosmas Nwobi, over a N3.4 billion loan dispute.

Justice James Omotosho held that the loan transaction between the company and Providus Bank Plc is purely contractual and does not need the interference of the EFCC.

This is contained in his judgment in suit number FHC/ABJ/CS/1516/2023, delivered on May 5, 2024, as filed by Nwobi’s lawyer, Joe Agi (SAN).

In a copy of the judgment seen by Nairametrics, the applicant sued the EFCC, Ms. Adenike Babalola (Head Of Economic Governance, EFCC), the bank, and Mr. Walter Akpani (Managing Director/Chief Executive Officer, Providus Bank Plc), for breaching his fundamental rights and threatening his business operations.

Agi submitted that Rexglobe Fuel Services Limited had a banking relationship with Providus Bank and sometimes on the 20th of November 2020, the bank offered a banking facility of N3,400,000,000.00(Three Billion, Four Hundred Million Naira) to the company for the order of 40,000 metric tons of Automotive Gas Oil (AGO), among others.

The lawyer noted that the applicant was shocked when the EFCC operatives invaded his company, and detained him for days until he produced three sureties.

He stated that on the 4th of July, 2023, his client’s home in Lagos was invaded by officers of the EFCC  in a Gestapo style. The EFCC marked his house with the inscription: EFCC UNDER INVESTIGATION “KEEP OFF”.

“The loan was subsequently disbursed and monies remitted. However, some issues arose and a meeting was called to resolve issues relating to the loan. The company also had to engage a consultant to reconcile accounts.

“Subsequently, he was shown a petition by the bank (by EFCC) which alleged that the applicant diverted the sum of $2,265,582.34 being monies availed to Rexglobe Fuel Services Limited by Providus Bank Plc.

“The Applicant made a statement where he denied the allegation and stated that the loan was secured by several securities to the knowledge of the 3rd and 4th Respondents”.

He urged the court to restrain the respondents from arresting him over the loan dispute as well as pay him N10 billion compensation.

EFCC’s position 

EFCC counsel, Rita Ogah Esq, confirmed that on the 14th of October, 2022, a case of criminal diversion of the sum of N4.536 billion was reported to the anti-graft agency by Providus Bank.

She denied breaching the fundamental rights of the applicant, noting that the applicant is alleged to have diverted the loan sum and did not use it for the purpose for which it was extended to him.

She stated that EFCC operatives were armed with a search warrant of the applicant’s house in respect of the loan dispute.

Providus Bank speaks

On his part, counsel for Providus Bank, M. Aribisala Esq, said the applicant,  after opening a current account No. 1300364999, applied for and was granted a Product Finance Facility in the sum of N3.400 billion to enable the company to meet an order of 40,000 metric tons of AGO.

The lawyer argued that the company then used the loan facilities to purchase forex in US dollars at the prevailing rate of N496 to $1 at the time.

The lawyer argued that the applicant failed to divulge the type of businesses he invested the money into and instead stated that he was willing to commence repayment in instalments to be worked out between himself and the bank.

“The 3rd Respondent refused the offer and urged the EFCC to investigate the whereabouts of the proceeds as the applicant and Rexglobe Fuel Services deliberately sold the base oil without its permission and diverted the proceeds of the sale,” the lawyer added, maintaining that it is within the bank’s rights to report allegations of crimes against a person to the EFCC  and the EFCC has the powers to investigate such allegations.”

What the judge said

In his verdict, Justice Omotosho held that the bank and its MD  knowing full well that its case against the applicant was rooted in breach of the loan agreement contract, petitioned the EFCC who ought to have advised them to pursue its remedy in a civil action.

He added that the respondents proceeded to harass the applicant until he was arrested.

“There is absolutely no basis for the arrest and detention of the Applicant as this Court from the evidence before it does not see any reasonable suspicion of crime against the Applicant. Consequently, the arrest of the Applicant no matter the length is hereby declared unlawful and carried out in bad faith against the Applicant,” the judge said.

He said labelling the loan facility as public funds does not alter the nature of the transaction, explaining that the monies belonging to a bank may be held in trust for its customers who are members of the public but does not make it public funds in the sense of government fund which belongs to the generality of the Nigerian public.

The court held that the EFCC painting an inscription “EFCC UNDER INVESTIGATION” on the house of the applicant is deeply prejudicial and gives off the impression to the public that the applicant is guilty of a criminal offence contrary to Section 34 of the Constitution.

The judge said the applicant had successfully established his case, adding that the indebtedness of Rexglobe Fuel Services Limited to Providus Bank Plc was not a criminal offence that would necessitate the EFCC and the other respondents to petition, arrest, detain the applicant without bail for 21 days.

The judge ordered the respondents to pay the applicant N2 million as compensation while barring them from detaining him in connection with the loan issue.

“An injunction is hereby made restraining the Respondents, their agents and assigns from arresting, investigating or demanding for the travel documents or doing anything in relation to or connected with the loan which is inimical to the interest, movement of the Applicant,” the judge said.

The judgment Implies that EFCC should focus on finance-related criminal offenses, not civil matters.

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