‘It’s wrong for regulator to be operator at the same time’

In this concluding part of the interview by Nze Chidi Duru, founder and largest shareholder in First Guarantee Pension Ltd, with Our Correspondent, he explained the genesis of the impasse with the National Pension Commission, insisting that it is wrong for a regulator to, at the same time, be an operator in the same industry. He urged government to ensure that the rule of law takes its course at all times. Excerpts:

What exactly is the genesis of the impasse with the NPC?

I would start from the beginning. For me, it was a matter that I actually could not have wanted to bring to the public domain. I can only say that I should think that my problem started in 2010 when we paid our first dividend. The DG, National Pension Commission (NPC), Chinelo Anohu-Amazu, approached me, then as company secretary/legal adviser to NPC, and requested that I assign to her 5percent of the shareholding in First Guarantee Pension limited, (FGP). For me and until very recently, I thought that was a friendly joke; I could not consider it seriously and that was the beginning of the problem. And immediately after that, our then Managing Director, Wilson Ideva, was motivated on the assurance that nothing will happen to him to begin to act in a manner that was disrespectful of Board of Directors of FGP and that led to our requesting him to resign. And what is interesting is that the same person we asked to resign from the company immediately resumed work as the managing director of Premium Pension Ltd, where Chinelo’s family owns interests in, and he is still there currently. It shows you the link of what has happened. He was encouraged to disobey the Board of FGP, where he was fired, and then he was picked up by them as a matter of protection. Chinelo again encouraged them, and they wrote what they considered to be a special target report on the FGP. Knowing full well our rights within the law, Section 82 of the Pension Reform Act, and by the way, you must also know that the Pension Reform Act was my handwork.

I was the chairman, House Committee on Pension Reform that made it possible for the bill to be passed within one month. I worked very hard at it; both in the House and in the Harmonisation Committee, where I single-handedly put all of these together and it was passed and then President Olusegun Obasanjo cited me for exceptional performance in ensuring that the bill for which the government was committed was passed in 2003 immediately I took over leadership, going through the motions of passage in the National Assembly. It was on that basis that the chairman of National Pension Commission, Fola Daniels ensured that I was granted licence. And on that basis, we now went on as Section 82 did say; and if for any reason PenCom, in the annual report conduct their report or examination of a PFA or Pension Fund Custodian, PenCom would then have to submit that report to the board of the PFA or the board of PFC. The board of PFC will now upon receipt of that report call an extraordinary general meeting of the shareholders of the company to consider the report.

The decision of the board of the shareholders is then communicated to the NPC. Now, Chinelo, realising that I am the largest single shareholder of the company and that the majority of the shareholders of the company reposed confidence in the board, refused to follow these steps. Instead, what they did was to ask us to resign as board members of FGP. Immediately, we went to court and on August 11, 2011, Justice Okorowo issued an ex parte order restraining them from implementing the special target report pending the determination of the substantive suit. But despite that order of the court, they disregarded it, dissolved our board and appointed staff of the National Pension Commission into FGP. Immediately after that we wrote to the Attorney-General of the Federation, who now wrote that letter of August 17, 2011 requesting them, not just as chief law officer, but also a party to the suit, to respect the order of the court and to be law-abiding. He followed it up with another letter on September 8, 2011. This is for me, my understanding of the desperation to take over the business I founded in 2004. The DG NPC has effectively taken over the office of the FGP and appointed the staff of NPC into the company. She has ran FGP with her staff in the last six years; and because of the recklessness and the fraud they have perpetrated in FGP, they would not, unless compelled to leave the company for its rightful owners. That is why they are employing impunity, but I am very confident that she could do this under the immediate past administration; she will not succeed in the current dispensation. It is impossible for her to continue with this level of impunity. FGP is my baby; I founded it and envisioned it. That is why being the only PFA that is founded by an individual, not by institution; the other PFAs are owned by insurance companies or banks, asset managers, stockbroking firms, etc. FGP is driven by an individual and it can only be my hard work that FGP is a success. And despite all the intimidations and impunity, I am still committed to realising the dream and vision for which FGP was founded.

Looking at all that you have gone through, what is the next line of action?

I believe that in keeping with the tradition, the DG NPC will expect that we back down and allow her to continue to run FGP. And I think that is a fundamental mistake on her part. The directors and shareholders of First Gaurantee Pension met in December 2016 and took some decisions. The first decision they took was to appoint me to take effective control of FGP, pending the appointment of a substantive managing director and for that I was given a mandate of three months (90 days) to achieve that. The second decision was to appoint an A-rated auditing firm to audit the books of FGP from 2011 to 2016 to be able to present a true picture of the state of affairs of the company. That will reveal both to me, the public and shareholders how successful FGP has been run over the years. The next resolution that was passed by the board at that meeting was the appointment of Smart Iheazor as Company Secretary, FGP, for the purpose of taking over the secretariat of the company going forward. The fourth which was the final decision is to ensure that the bank mandate of the board is respected. The only bank account the company opened before the impunity of 2011 was with First Bank; any other account that was opened, we must take steps to either regularise the account and ensure that only approved staff of management that I head would operate that account and that within the next three months, we then render account to shareholders following a board meeting. So next step for me, for the board and for the business is to take over the reins of leadership in FGP and then implement the resolution of the board as it is clearly stated by the board. I believe that under this present administration, the impunity of the past would also be a thing of the past; that a ray of hope would descend in FGP, and the shareholders would then have the benefits of the investments they have made in the company. The only dividend that has been paid in FGP was the one I paid on February 6, 2010, ever since then we have not had any other. What has happened is that the DG, NPC and her appointees have embezzled over N3.2billion of the funds. They have continued to spend the funds of FGP as if they have gone out of order. To buy an IT in FGP they spent over N70million and all the staff of NPC appointed in FGP are living large under the resources of FGP, whereas shareholders who invested their resources, Chinelo has refused to account to them on how their business is going or what has happened to their investments.

How would you assess the role of the EFCC, the police and other agencies of government in the matter so far?

It is with regret that I would say that the NPC, a commission that we envisioned, when I worked very hard to promote the pension industry in Nigeria is not the same we wanted in 2004 when Fola Daniels was the chairman of that commission. I believe that a regulator cannot at the same time be an operator in the same industry. There is bound to be conflict of interests. It is on that note that I insist that the NPC is no longer objective. The takeover of the FGP which they claimed was on an interim measure has now appeared to be on permanent measure. An interim measure will not last more than three months but this has lasted six years, if you take it to March 22 of this year, because their invasion of FGP happened March 22, 2011. It is regrettable that this has happened; it is regrettable that we have a commission that has not risen to the occasion to determine that they are not in any position to manage anybody’s business. And does not care the impact and consequences of what is going on in FGP and in the industry. Rather than focus on what is important- where to invest the assets of pension industry and to ensure that the rate of returns is sufficient in a country like Nigeria to keep pace with inflationary trend, the DG is focusing on how to take over FGP, to ensure that the rightful owner, the founder and the promoter and largest shareholder of the business does not take benefits from the investment he has done. Her focus is to ensure that by hook or crook, Nze Chidi Duru goes to jail. But we are in a democracy, in a government of rule of law; a government that is different from the government of the past. For me, it is damning report on the agency she leads. I believe by this singular act, she is not fit to continue to be the DG of the NPC. She believes she is god; but I know she is not greater than the living God. As for the Nigeria Police Force, EFCC, again, it is a regret that they have lent themselves to the impunity of a lawless DG of an institution that has no respect for the rule of law. There are conflicts involved in all these; not just that there is a judgment of the court on this; but with respect to the filing of audited account of FGP. CAMA (Companies and Allied Matters Act) Section 235, it’s mandatory that every company must file their report to CAC at the end of their business financial year. Our financial year has closed respectively over five times in the last five years- between 2011 and 2016 and there is no filing of the FGP annual report before the CAC. More importantly, it is only when you file and auditors do their own part that the company would be assessed to pay their tax. What we found recently is that FGP is carrying a fat liability of over N500 million, this is money that government could have used to provide social services, infrastructure for the people of this country, not to talk of PAYE, or company tax available to Nigerians. So, FGP as it stands now has a huge tax liability of close to N2billion. And government is not accessing this fund simply because one person is standing the law on its head, using impunity.