N3.5 Billion Fraud Uncovered In National Assembly

The 2016 annual audit report released by the Auditor General of the Federation has revealed that about N3.5 billion was misappropriated in 2016 by the management of the National Assembly.

REVEALED: How National Assembly mismanaged billions of Naira through illegal expenditures, fraud – Audit Report

About N3.5 billion was misappropriated in 2016 by the management of the National Assembly, an… https://t.co/6YHRmySUrJ

— Tonny Shallom (@tonnyshallom) November 1, 2018

Naija News learnt the monies were siphoned through various schemes such as failure to retire advances, financial documentation irregularities, excess payment for goods, controversial purchases and diversion of funds.

The report, released this year, noted how the agency failed to provide receipts, vouchers or contract documents for many transactions made in 2016.

As Senate President, Mr Saraki heads the overall institution of the National Assembly. Some other key officials in the National Assembly with direct or oversight management responsibilities include the Speaker of the House of Representatives, Yakubu Dogara; Clerk of the National Assembly, Mohammed Omolori; Chairman of the National Assembly Service Commission, Adamu Fika; and Director General of the National Institute of Legislative Studies, Ladi Hamalai.

Some of them were directly indicted n the report according to Premium Times.

INDICTMENT

During the audit of the accounting records maintained at the National Assembly and its agencies, at the management section, under the General Services, it was revealed that capital account payment vouchers for amounts totalling N417 million (N417,312,538.79), raised for settlement of some contractors, were without vital supporting documents, “a financial decision that depicts violation of Financial Regulation which provides that all vouchers shall contain full particulars of each service as to enable them to be checked without reference to any other document and will invariably be supported by relevant documents.”

“The Clerk to the National Assembly, Mohammed Sani Omolori, should produce the supporting documents to the payment vouchers or recover the amount in question from the contractors,” the auditor ruled.

Also, during the audit of staff salary accounts, 37 payment vouchers with amounts to N67 million (N66,713,355) were observed to have been paid between January and June, 2016 for items not related to personnel cost.

The payees in the cashbook also did not correspond with those in the bank statement. This irregularity is a violation of Financial Regulation which states that “Expenditure shall strictly be classified in accordance with the estimates and votes must be applied only to the purpose for which the money is provided. Expenditure incorrectly charged to a vote shall be disallowed.”

“The sum of N66,713,355.08 being irregular expenditure should be recovered from the officer who approved the payments from the personnel vote,” the auditor instructed.

Review Of Expenditure

During the review of documents of capital expenditure vote by the auditor, it was discovered that payments totalling N116 million (N116,162,522.60) were made between April and June, 2016 to some contractors for various jobs carried out, without raising payment vouchers.This contravenes the provisions of Financial Regulation which state that under no circumstance shall money be paid for services, for which a voucher has not been raised.

“The Clerk to the National Assembly should produce the payment vouchers for examination,” the report added.

Also, a total sum of N57 million deducted from various contract payments in respect of Withholding Tax and Value Added Tax was without evidence of remittance to the tax authorities.The clerk was asked to produce the acknowledgement receipts from the Federal Inland Revenue Service for verification. He was stated, in the report “to have ignored the auditor on these issues.”

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Indicted Senate

At the upper chamber of the National Assembly under Mr Saraki, scrutiny of financial documents of the Senate revealed that about N974 million was not accounted for as against financial regulations. This was mostly due to poor control in the management and accountability of public funds, “where members of staff of the Senate fail to retire advances worth millions of naira”, the report explained.

The auditor noted that: “personal advances totalling N747,286,680.00, granted to staff between February and December 2016 for various procurement and services, were not retired as at the time of examination in June 2017.”

The clerk was instructed to recover the whole sum from the defaulting officers and furnish recovery particulars for verification. He has not. It was also revealed that the Senate purportedly made payments of over N100 million “for taxes with no supporting documents.”

“Withholding and Value Added Taxes totalling N118,625,057.48, which were purportedly remitted to the Federal Inland Revenue Service, were not acknowledged with revenue receipts. The Clerk to the National Assembly should produce the receipts from the Tax Authorities for verification.”

Other payment vouchers for amounts totalling N109 million paid from the Capital Expenditure vote, were not presented for audit examination by the Senate. The auditor has subsequently directed the Clerk to produce the payment vouchers for examination, “or refund the amount in question to government coffers.”

House of Representatives, Legislative Institute Indicted

A review of documents of the House of Representatives under the leadership of Mr Dogara, also revealed that about N1 billion was misappropriated.

Pay As You Earn (PAYE) deductions from staff salaries totalling N821.6 million was claimed to have been remitted to tax authorities with no receipts or documented evidence to show for it during audit verification, a development the auditor noted runs in contravention to Financial Regulation. The regulation states that “deductions for WHT, VAT and PAYE shall be remitted to the Federal Inland Revenue Service at the same time the payee who is the subject of the deduction is paid”.

Also, according to provisions of Financial Regulations that require accounting officers to provide adequate advances’ records and to ensure that officers granted advances retire them promptly, advances granted to officers of the House of Representatives totalling N254 million for procurement of goods and services between January and December, 2016 remained unretired as at the time of examination in June 2017.

Financial recklessness and misappropriation of funds are not the exclusive preserve of the law making sections. According to the audit report, this extended to the National Institute for Legislative Studies, where N412 million was paid for 11 motor vehicles purchased at a contract sum of N375.9 million.

Examination of the capital account cashbook revealed that after formal payment was made for the vehicles, an additional sum of about N37 million was paid to the same contractor in September 2016 under the same contract, “without approval”.

The auditor has directed the management of the institute to justify the over-payment, which is in excess of the contract sum or recover the funds.

Also, at the institute, it was discovered that seven members of staff who were redeployed from the National Assembly to provide ‘specialised’ services were paid N11 million from the overhead costs vote. The payment, however, could not be

“measured, since the personnel details such as salary grade levels, steps, status and rank of the officers were not disclosed in the payroll sheets”. “The management of the institute should justify these payments or recover the amounts from the seven officers and furnish recovery particulars for verification,” the report noted.

The institute is an organ of the National Assembly established by an Act of Parliament.

At the Legislative Aides Section, N12 million earned as interests on bank accounts in a commercial bank between January and December 2016, was not paid into the Consolidated Revenue Fund.

The sum of N9 million was earned from the Personnel Costs account, while the overhead account earned an interest of N3 million.

The non-remittance of these amounts, according to the auditor, contravened Financial Regulation which stipulates that “Interest earned on bank accounts must be properly classified to the appropriate revenue head of Accounts and paid to the Consolidated Revenue Fund”.

“The Clerk to the National Assembly should remit the sum of N12,274,587.77 to the Consolidated Revenue Fund and forward relevant particulars for verification,” the auditor stated.

Also, documentation irregularities were observed in the recruitment of legislative aides and this resulted in the payment of salaries and allowances “not worked for”, totalling N9 million.

Official Reaction

Repeated efforts to get reactions from the Clerk of the National Assembly, Mr Omolori and spokesperson of the Senate, Sabi Abdulahi, were not successful as calls placed to their known telephone lines did not connect.

However, the spokesperson of the House of Representatives, Abdulrazak Namdas said he was not aware of the said report.

“I cannot give you an answer right now because I am not aware of what you just told me. I need to speak to the appropriate committee before I get back. I think it is not something I can give you a straight away answer. I just heard it (report) from you, so I have to get across to the relevant authorities to get the information and then get back to you.

“Do you know the chairman committee on public accounts? Well, this is the committee that can give us a straight away answer and during this electioneering campaign, I am not too close (to them). Let me get back to my colleagues and then get back to you.”

He didn’t pick subsequent calls