AMCON may declare debtor public officers bankrupt

 

BY OUR EDITOR

The Asset Management Corporation of Nigeria (AMCON) may resort to declaring public officers indebted to it bankrupt, as part of effort to recover over N5 trillion outstanding debt.

A legal consultant and Senior Partner, Olaniwun Ajayi LP, Mr Muyiwa Balogun, who challenged the Corporation and Judges of the Federal High Court of Nigeria to adopt the measure, urged them to leverage the 2019 Amended AMCON Act and declare AMCON obligors who are holding public office bankrupt.

“Once you are declared bankrupt, you cannot hold public office. Today, we have AMCON debtors making laws for the Federal Republic of Nigeria. AMCON, with your support, needs to go to court and declare such individuals bankrupt. Given the sunset period of AMCON and the fact that the debt we are talking about is the commonwealth of Nigeria, it would not be out of place to take the full advantage of the bankruptcy power among other special powers in the new amendment,” Balogun enjoined the judges.

The lawyer, who reviewed the Amended AMCON Act 2019 at a one-day seminar for Judges of the FHC in Abuja at the weekend, argued that the only alternative to the recovery challenge was for the judges of the FHC to take the matter as a national assignment and explore all the powers of the new amendment.

N5 trillion debt: ‘Judiciary must help AMCON recover money’

He stated that the bankruptcy proceedings have been explored in other climes to address similar matters and argued that there was no reason it should not work in Nigeria.

“As a way of being proactive with the new amendment of the AMCON Act, let us test the bankruptcy proceedings because it will be effective. In other jurisdictions, this has proved to be a very potent tool and why not in Nigeria,” he wondered.

The 2019 Amended AMCON Act, which was signed into law by President Muhammadu Buhari earlier in the year provides AMCON with sweeping powers to help it recover the huge debt owed the corporation by obligors as a result of AMCON intervention in the banking sector.

AMCON was created in 2010 as a result of the global economic crises of 2008/2009, which nearly cripples the financial sector of Nigeria.

According to a statement by the Corporation’s Head, Corporate Communication, Jude Nwauzor, without AMCON’s intervention at the time, depositors would have lost N3.7 trillion and over 15,000 jobs would have also been lost.

“Recall that AMCON had purchased approximately 12,743 loans from the banks through debt instruments worth N3.9 trillion with the simple understanding of recovery either through voluntary payment or disposal of assets of the obligors. The government at the time had thought a strong law could as a matter of fact guarantee that, hence the enactment of the AMCON Act in 2010,” the statement stated.

AMCON Managing Director/Chief Executive Officer, Mr. Ahmed Kuru, said even though obligors of the Corporation have been working hard to stretch the Corporation to the sunset period, the corporation, under his leadership was determined to achieve its mandate within the limited time available (and within the law).

“We have repeatedly made the point at every opportunity that all stakeholders must view the AMCON mandate as one of serious national importance. If at sunset AMCON is unable to recover the huge debt of over N5 trillion, it becomes the debt of the Federal Government of Nigeria for which taxpayers’ monies will be used to settle. The implication is that the general public will be made to pay for the recklessness of only a few individuals who continue to take advantage of the loopholes in our laws to escape their moral and legal obligations to repay their debts. We should not allow a few individuals to escape with our commonwealth.

“And we want to do it within the confines of the law. As we all know, the Federal High Court is AMCON’s court of first instance. Under the new amendment, State High Courts and the High Court of the FCT have also been vested with jurisdiction to hear AMCON matters, but the powers to grant ex parte orders under section 49 and 50 of the amended AMCON Act still reside exclusively with the Federal High Court,” Kuru submitted.

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