SERAP Advises FG Against Borrowing Dormant Account Balances, Unclaimed Dividends

President Muhammadu Buhari has been advised by the Socio-Economic Rights and Accountability, to stop the plan by the Federal Government to borrow about N895bn of unclaimed dividends and funds in dormant accounts.

According to Punch, the Buhari-led government has plans to borrow unclaimed dividends and funds in dormant account balances of Deposit Money Banks using Part XII of the Companies and Allied Matters Act in the signed Finance Act 2020.

According to the Finance Act, signed into law by Buhari last December, FG are allowed to borrow unclaimed dividends and dormant account balances owned by Nigerians in any bank in the country.

SERAP in a statement released through its Deputy Director, Kolawole Oluwadare, described the plan by the Federal Government as illegal.

Part of the statement read, “The right to property is a sacred and fundamental right. Borrowing unclaimed dividends and funds in dormant accounts amounts to an illegal expropriation, and would hurt poor and vulnerable Nigerians who continue to suffer under reduced public services and ultimately lead to unsustainable levels of public debt.”

“The right to property extends to all forms of property, including unclaimed dividends and funds in dormant accounts. Borrowing these dividends and funds without due process of law, and the explicit consent of the owners is arbitrary, and as such, legally and morally unjustifiable.”

“The borrowing is neither proportionate nor necessary, especially given the unwillingness or inability of the government to stop systemic corruption in ministries, departments and agencies [MDAs], cut waste, and stop all leakages in public expenditures. The borrowing is also clearly not in pursuit of a public or social interest.”

“The security of property, next to personal security against the exertions of government, is of the essence of liberty. It is next in degree to the protection of personal liberty and freedom from undue interference or molestation. Our constitutional jurisprudence rests largely upon its sanctity.”

“Rather than pushing to borrow unclaimed dividends and funds in dormant accounts, your government ought to move swiftly to cut the cost of governance, ensure review of jumbo salaries and allowances of all high-ranking political office holders, and address the systemic corruption in MDAs, as well as improve transparency and accountability in public spending.”

“The borrowing also seems to be discriminatory, as it excludes government’s owned official bank accounts, and may exclude the bank accounts of high-ranking government officials and politicians, thereby violating constitutional and international prohibition of discrimination against vulnerable groups, to allow everyone to fully enjoy their right to property and associated rights on equal terms.”