Beneficial Ownership disclosure has been a growing issue of interest in the local and international space since EITI resolved in 2013 to implement the law, of which Nigeria is one of the eleven participating countries to deploy the law’s power in mitigating corruption risk.
Noting that the failure to meet this deadline could mean Nigeria losing its EITI “satisfactory” rating, BudgIT decries that an estimated $8.3 billion of illicit funds are taken out of Nigeria annually, out of the nearly $1 trillion that illicitly leaves developing countries due to hidden company and property ownership.
As enunciated in our recent research “Beneficial Ownership Reform in Nigeria: Key Insights for citizens and Policy Makers” we reiterate that the financial loss could provide 200,000 small businesses every year with capital of N25 million each, creating 200,000 new jobs per year for the over 20.9 million unemployed people in the country.
It is worthy of note that beyond susceptibility to illicit financial flows, companies with anonymous or hidden ownership structures are a serious risk to sovereign nations as they have significant potential to be used in secretly funding insurgencies and terrorism. This risk is a major concern for a resource-rich country like Nigeria, a country which exports $38 billion worth of petroleum products annually while fighting at least two distinct internal insurgencies in its Niger Delta, the oil-producing region, and the country’s Northern region, which is rich in solid minerals.
A typical example is the Malabu case where Nigeria awarded OPL 245 to Malabu Oil and Gas Limited, unknown to the citizens, the person awarding the oil prospecting license, the then petroleum minister, Dan Etete, was also the beneficial owner of Malabu Oil and Gas Limited. Ultimately, Dan Etete, using the influence of his office ensured that Malabu Oil and Gas Limited paid only $2million out of the $20million legally required by the state, translating to a loss of $18m to the Nigerian government. With a functioning beneficial ownership register/database this transaction would have been flagged and potentially stopped.
“The government needs to develop an Automated Risk Scoring Algorithm (ARSA) which will utilize data from the beneficial ownership register and other sources,” said Gabriel Okeowo, BudgIT’s principal lead.
“This algorithm should be utilized by all MDAs to carry out due diligence checks prior to the award of any license, permit or public contract. The ARSM will check for things like the presence of politically exposed persons, persons of interests in local and international money laundering or terrorism investigation etc, and then output a single “Risk Score” from 0 - 100. Riskier transactions would be flagged, while this would have prevented the occurrence of something like the Malabu scandal,” added Okeowo.
Point of correction, there's no insurgency in the Niger Delta area rather militancy. The right words should be used so we don't send wrong information to the civilized world.
ReplyDeleteQuite unfortunately, we have a President who doesn't understand how to govern or run an economy. Worse still, the assemblage of people in his administration are all sycophant singing his praise even in a glaring situation where Nigeria is deteriorating into a huge monumental mess.
Keep ranting has you have always done about him, he his completing his 2 term which is still your pain because your hero could not get it. For you nothing good can come up from this administration.
DeleteYemi, if he does anything good I will commend him like I did in the border closure even though the timing was wrong and also the bail out fund to states. But this doesn't mean we shouldn't speak up when things are getting worse steadily under his watch. No!!! we can't do that. Nigeria under his watch is too dangerous to keep silence in the face of this glaring destruction looming.
DeleteBudgiT should go and sit down somewhere. When bubu appointed one of them as adviser, why did he resign when they claimed to know the problems?
ReplyDeleteIt's easy to tackle gov policies but come and do it, he ran away
A simple google search will tell you why the dude resigned.
DeleteThis is simply why the minority elite takes the youth for a big ride always, and seems nothing can be done about it.
A man once said; If you want to hide something from a black man, put it into writing!! Don't be dumb. READ BEFORE YOU TYPE!!!
Anon 5.41,
DeletePray tell why he resigneth????
He had the opportunity to walk his talk and didnt.
God bless you Anon 05:41. I stopped engaging the young man above you the very day I read his comment saying he's a die-hard buharist. Those people nothing about the truth they see or will admit.
Delete@The Posh Yoruba, let me answer your question. It will interest you to know that the first people that clamoured for his resignation were the BMO(Buhari Media Organization) The records are there if you doubt this. They said he was the President critics, which truly he was. Don't forget the same BMO also pushed another would be aide to the Senate President when he was appointed. There reason was that he served under Bukola Saraki.
DeleteTruth is that, the man in BudgIT would have been rubbished if he had took over that appointment. If the government didn't take his advice when he was outside criticizing, is it when he join them they would do?
"It is clear that recent media reports about my appointment have created a complex narrative, which I believe would engender an atmosphere of mistrust, as I planned to proceed.
Delete“Upon further reflections on the furore that has been generated by my new role as a Technical Adviser to the Minister of State for Budget and National Planning, I humbly resign the appointment"
Seun Onigbinde stated the above as reason for resignation.
Why should he bow to pressure? Leadership role especially govt is susceptible to different attacks from critics. When I was Speaker of my faculty(Faculty of Education) in school, I insisted that the faculty should present a single candidate for each positions available at the SUG election. I got a lot of criticisms but I knew that Education is the biggest faculty, so we need to concentrate our votes instead of having multiple candidates for a position which will make our numbers not to count. After the election, we won 7 out of the 9 positions available, a feat never recorded! Till today, I still get calls from the school for advice after many years