Innoson, GTBank Faceoff: The hidden truth (See Documents)

by AljazirahNigeria | December 31, 2017 11:19 am

By Danielson Monday, Abuja

There is no doubt that Innoson Motors and Guaranty Trust Bank (GTBank) are big players in Nigeria auto market and financial industry respectively. Both are big employers of labour and have provided Nigerians from different strata with jobs and opportunities to display their skills and contribute to the Gross Domestic Product (GDP) of the biggest market in the African continent. The two business entities have been working together for years and are partners in progress before the December 19, 2017 arrest of Chairman/CEO of the Innoson Group, Chief Innocent Chukwuma, by the Economic and Financial Crimes Commission (EFCC) for allegedly turning down its invitation after skipping administrative bail.

The commando-like invasion and forceful arrest of the Innoson boss by the EFCC at his Enugu GRA residence left mouths agape as to why business transactions between two business partners could have warranted the anti-graft agency to allegedly take side with one of the partners. Ethnic colouration was read to the arrest of Chukwuma who is from the South-Eastern part of the country the region that has not enjoyed enough patronage from the government of President Muhammadu Buhari. GTBank was co-founded by Olutayo Aderinokun, a Nigerian entrepreneur who until his death was the Chief Executive Officer, CEO. There were massive withdrawals and close of accounts from GTBank by Innoson’s kinsmen who were not able to stomach the alleged ill-treatment meted to their brother by an agent of government that has relegated them to the background in Nigeria.

Chukwuma was arrested by the EFCC for allegedly turning down its invitation after skipping administrative bail. GTBank had in a press release posted on the Nigerian Stock Exchange (NSE) stated that “as a law abiding corporate citizen” it reserves the right to “report any untoward/criminal activity to the appropriate law enforcement agencies for investigation. The bone of contention between the two business entities was N2.4billion loan allegedly granted by the GTB to Innoson in 2009 and which the vehicle-manufacturing company has allegedly refused to pay back years after. But the head, corporate affairs of Innoson Group, Cornel Osigwe was quoted to have said that “He (Innoson) was never invited by the EFCC, we challenge them to come forward with any evidence showing that he jumped bail. This is GTBank using federal authorities to persecute an illustrious citizen who has done a lot to improve the economic development of this country.”

A check by AljazirahNigeria established the fact that under letter of credit in international trade, bill of ladings are consigned to banks not because the banks (consignees) are the owners of the goods but rather to ensure that the seller is paid and the buyer receives the good. It further reveals that a mere consignment or endorsement of a bill of lading does not confer title in the goods covered by the bill of lading to either the consignee or the endorsee and where consignment or endorsement of a bill of lading is intended as a security for loan, consignment or endorsement in such circumstance, does not transfer the title in the goods to the consignee or the endorsee.

This has been the relationship between Innoson and GTB before the things went sour. It was a business agreement that has stood the test of time and respected by both parties. AljazirahNigeria confirmed from a reliable source that all Innoson’s letter of credit transactions (LCs) were confirmed LCs which is cash against documents and Innoson paid 25 percent of every LC before it was opened.

Some documents stumbled upon by AljazirahNigeria established that the Police high command under the former Inspector General of Police, MD Abubakar, commenced investigations on the Innoson/GTBank matter since 2009, went to court and withdrew the case in February 2016. The Police carried out its own investigation only to find out that Innoson committed no offence relating to any fraud, approached the court to withdraw the case until the recent Gestapo-style approach by the EFCC to arrest the Innoson boss again.

The EFCC under the former chairman, Ibrahim Lamorde, had in 2013 invited the Innoson boss for interrogation and questioning and charged the matter to a Lagos High Court and the matter is still pending. The December 19 arrest of Chukwuma thus raised the suspicion of why the EFCC would invade the residence of the businessman when the case is still in court and the anti-graft agency under Ibrahim Magu has not extended invitation to him since 2013. Chukwuma has thus challenged the EFCC to make public any letter of invitation sent to him and refused to honour.

Narrating his ordeal in the hands of EFCC operatives, Chukwuma said, “I was surprised that in the early morning (of December 19, 2017), they (EFCC) operatives jumped into my house. I thought they were kidnappers or armed robbers but finally I noticed it was EFCC. At around 07:30am, they said they wanted to arrest me and I followed them to their office. EFCC under Ibrahim Magu has never invited me, nobody invited me. they just jumped into my house. If they invited me, I would have answered them because I am a genuine businessman, I am an industrialist, I don’t have any skeleton in my cupboard.”

Innoson has instituted cases against GTB in various courts of competent jurisdiction, some won and others pending. The head, corporate affairs of Innoson Group, Cornel Osigwe said Innoson commenced “Suit No: FHC/AWK/CS/139/2012 against GTB at the Federal High Court, Awka Division, in respect of the money GTB ‘stole’ from its account claiming 22 per cent interest thereon from the date GTB started the stealing. In this suit, GTB was represented by an eminent Senior Advocate of Nigeria. On 16th May, 2013, the trial court rendered judgment in the sum of N4.7billion in favour of Innoson against GTB. GTB apealledagainst the judgement to the Court of Appeal, Enugu Division, vide Appeal No: CA/I/288/2013. In this appeal, on 9th December 2013, the Court of Appeal ordered GTB to pay the judgment debt which then stood at about N6billion into an interest yielding account.”

Also, according to Osigwe, on July 29 2011, in Suit No: FHC/L/CS/603/2006, the Federal High Court, Ibadan Division, ordered GTB, by way of Garnishee order absolute to pay over N2billion to Innoson. Osigwe said rather than pay to Innoson, GTB appealed to the Court of Appeal, Ibadan Division, vis Appeal No: CA/I/258/2011. But in a unanimous decision on February 6 2014, the Court of Appeal dismissed the appeal and ordered GTB to pay the ordered sum of over N2billion to Innoson.

The Innoson corporate affairs head also added that GTB commenced Suit No: FHC/L/CS/1119/2014 against Innoson at the Federal High Court, Lagos Division and thereat, through ex parte order, frozen Innoson’s account in 18 banks in Nigeria for 9 months. However, in a considered judgment delivered on June 10, 2015, the learned trial judge dismissed the suit and set aside the ex parte order.

“GTB has never granted any loan of N2.4 billon to Innoson in 2009 but rather a loan of N500 million through its offer letter of 17th December 2009. The last loan transaction between GTB and Innoson was in 2011. Through its letter of 2nd March 2011, GTB offered a loan of N1.7 billion to Innoson. The principle terms and security for this loan were: Legal/Tripartite Legal Mortgage over Innoson’s properties valued at N1.1 billion in 2010 by GTB appointed valuers; 25 per cent equity contribution by Innoson on each letter of credit (LC) transaction and shipping documents worth N500 million shall be released at any point in time to Innoson,” Osigwe said.

Innoson have alleged GTB of deducting over N700 million from its account but the bank claimed it only deducted N500 million. The persecution of Chukwuma AljazirahNigeria gathered is not unconnected with the support he gave to the re-election bid of former President Goodluck Jonathan. The former President gave utmost attention to local content using Innoson as a case study and today Innoson’s case is a success story as far as automobile industry in Nigeria is concerned.

The Federal Government is alleged not to be comfortable with Innoson’s growing profile and is employing all possible means to stifle it. Although the President Muhammadu Buhari is mouthing the growing of local content in the auto industry, government officials at the federal, states and even at the local levels are patronizing foreign auto makers who are not contributing nothing to the growth and development of the Nigerian economy.

Nigerians want the government to wade in and maintain neutrality in the ongoing feud between Innoson and GTB by allowing the courts to decide where the case will go. The two warring parties are expected to sheathe their swords as further wrangling will not only throw some Nigerians into the labour market but also divide the country further along ethnic lines.

Innoson should be what Ford is to America economy, Mercedes Benz to Germany automotive industry and Saipa and IKCO Samand are to Iranian automobile market.

 

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