The former group managing director of Intercontinental Bank Plc, Erastus Akingbola, at a public sitting with the House Committee on Market and Institutions, on May 27, revealed how Zenith Bank Plc and Union bank Plc, alongside the Securities and Exchange Commission may have defrauded Nigerians in the public offer of Africa Petroleum Plc shares.
1. "At Completion Board Meeting, SEC is supposed to be there and they were there. And when you have firm underwriting, you are supposed to even exchange cheques that day. If cheques are not exchanged, commissions are not paid. Didn't SEC ask what is going on?
The reason why cheques were not exchanged, some of the banks went there with smaller cheques, when they saw bigger figures, they put their cheques in their pocket. Because they told the lead underwriters, the figures here are different from what we agreed in all our discussions. They said ‘don't worry, don't rock the boat, let this ceremony go on, we will resolve it,' and we agreed.
"So there was no cheque exchange, no commission paid and with my amateur law, no consideration even passed. So how come we are saying that there is a contract?
2. "They said we signed. Yes we signed. But if you sign and you can prove that there is a fraud in that contract, it is actionable. The fraudster should not be allowed to profit by that fraud. Every court knows that and that is what we are standing on. We are not saying that we did not sign, but we are saying we have evidence to show that there is deceit in this matter.
3 "Prospectus: I don't know whether the committee has seen the prospectus, I will show you the true copy. Pages seven and eight have an over-imposed page which carried different figures and this is what went out to the public. So have we not even deceived the public to say that on one side the following banks and underwriters are underwriting this? On the superimposed page, there is another one. I was thinking that SEC should have told them go and change this before you go to the market.
4. "What we are saying here is that law cannot override morality. There is moral issue in these matter. A situation where people purported to be lead underwriters collected money for ₦10 billion suddenly overnight change to ₦800 million each, and push bigger figures to other people.
5. "The understanding of the Completion Board Meeting which we all know is a ceremony that nobody wants to rock. Usually, when you complain, they say ‘don't worry; after the issue, we will resolve it.' They did not come back to regularise this issue. There is breach of promise. They did not come back to regularise the documents. We did not get this final documents until the offer closed. So, we had no opportunity to even know what they promised they will correct. They did not correct it, that is the issue.
6. "This issue closed September 29, and we did not get the documents in our own office until later in October. They even dated October 02 in their own office. So there is no opportunity for us to have checked and complained to SEC. So, it's a smart game and that is what we are against.
7. "If we are owing AP, we could say ‘AP, turn it to deposit for us for one year' they will agree. But that is not the issue. The issue is that we cannot profit through this fraud, that is what we are after.`
8. "The lead underwriters who made some representation to us and said they will be underwriting ₦10 billion each and put their banks forward, suddenly they removed their banks and put their issuing houses or capital companies and then reduced their own offer to ₦800 million each and those who were supposed to accompany them on a journey, they gave all of us ₦5 billion, ₦6 billion and we said ‘this is not fair.' We have no problem with the issuer, it's a problem with the lead underwriters and this has to be resolved.
9. "SEC [the Securities Exchange Commission] coming to behave like a prosecutor; I think they are holding themselves out unnecessarily. Something they should resolve is what they are now coming to be against they are even taking sides and I don't think this is right sir."