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Market Digest Nigeria

Finance

Mauritz Firm battles Katsina for 20% of N66bn Paris Club refund

A financial consulting firm, Mauritz Walton Nigerian Ltd, has asked the Federal High Court in Abuja to order the Katsina State Government to pay it the 20 per cent of $217.3m due to it from the Paris Club refund made to the state by the Federal Government.

The company alleged that the 20 per cent of the $217.3m (66bn) was the contractual fee for the service it rendered the state government to ascertain and recover the excess deductions by the Federal Government from its account to service the external debt between July 1995 and March 2002. According to the firm, the 20 per cent agreement it reached with the state government in 2014 amounts to about N13.2bn. It stated, through its Chief Executive Officer, Dr. Maurice Ibe, that it was appointed by Katsina State to executed the contract via a letter dated August 18, 2014, and with reference number, MOF/STAFF/409/1/31.

Ibe stated in his witness statement filed along with his company’s suit, that his firm executed his contract by ascertaining that Katsina State Government was entitled to $217,274,991.01 (estimated at N66,268,872,258.00 calculated at an exchange rate of $1 to N305) as Paris Club refund. He noted that, in 2016, President Muhammadu Buhari, directed the payment of the first tranche of the Paris Club refund to states, including Katsina. He stated that while the funds due to Katsina State from the Paris refund had been paid to state’s account with the United Bank for Africa, the state had refused to pay his firm the 20 per cent of the fund agreed to be its fee. Ibe said despite his suit and various interim orders restraining further payment to Katsina, the Central Bank of Nigeria (the 2nd defendant in the suit), on the instruction of the Minister of Finance (the 1st defendant) recently paid N35,364,610,435 to the 4th defendant (Katsina State), through the 5th defendant (UBA).

But in its statement of defence filed in response to the suit, the Katsina State Government conceded that it truly engaged the plaintiff to ascertain and recover its share of the Paris Club refund. But it stated that there was no conclusive agreement for the payment of 20 per cent to the company before it was disengaged. The statement government stated it had “no reason to honour the demand of the plaintiff as contained in its letter of July 10, 2017 and at the subsequent  meetings with the plaintiff as there was no conclusive agreement between the 4th defendant and the plaintiff to pay the said 20 per cent of the credited refunds as the plaintiff had been disengaged.”

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