Subsidy scam: EFCC alleges overpayment for 16m litres

The Economic and Financial Crimes Commission at a Lagos High Court, Ikeja, on Wednesday accused four oil marketers and their firm of receiving an overpayment for 16 million litres of Premium Motor Spirit (petrol) they claimed to have supplied in 2010.

The accused marketers -- Walter Wagbatsoma, Adaoha Ugo-Ngadi, Fakuade Babafemi and Ezekiel Ejidele along with their firm, Ontario Oil and Gas Ltd -- are facing trial for alleged N1.9bn subsidy fraud.

The anti-graft agency made this allegation through a police investigator attached to the commission, Mr. Damon Yelma, while testifying as the first prosecution witness in the trial of the accused on Wednesday.

Yelma, who was led in evidence by EFCC counsel, Mr. Rotimi Jacobs (SAN), said he was among the team that investigated the alleged fraud in the Petroleum Support Fund scheme.

He alleged that the firm in the third and fourth quarters of 2010 had respectively imported 10 million and 12 million litres of Premium Motor Spirit, but claimed to have imported 19 million litres on each of the occasions.

Yelma said, "In the third quarter of 2010, Ontario bought petroleum products from Vistol SA using a modern vessel called Pacific.

"They discharged the said product to Integrated Oil and Gas Depot, the company discharged 12,070,706 litres. After delivery, the company claimed that the product delivered was 19,681,731 litres.

"When they wrote to the Federal Government for subsidy claims, the company claimed subsidy for 19 million and subsidy was paid for that quantity."

Continuing his testimony, Yelma said, in the fourth quarter of 2010, the same company imported and discharged the product at the Obat Oil and Gas depot.

He said, "The quantity at that time, as shown on the depot Shore Tank recovered from the depot, was 10,446,544 litres but Ontario Oil and Gas claimed that the products supplied was 19,523,892 litres, and went ahead to claim subsidy for the same number of litres."

However, Wagbatsoma's counsel, Mr. E.D. Onyeke, faulted the witness's allegations, saying the EFCC was only relying on the claims of the tank farm owners without further investigating it.

Onyeke said, "Two separate shore tank certificates were issued by Obat Oil Ltd. in respect of the said transaction.

"The one that had only the stamps of Obat showed that 10,146,494 litres were discharged.The other certificate which had Obat stamps and signature along with that of the Petroleum Products Pricing Regulatory Agency showed that 19,523,892 litres were discharged."

The defence lawyer added that the same discrepancy was also noticed in the transaction involving Integrated Oil and Gas Ltd.

He added, "All documents generated in the course of these transactions, including the bill of lading, cargo manifest and haulage reports, showed that at least 19 million litres of PMS was imported at both times.

"Why did the EFCC rely only on the claims by the tank owners without any further investigations?"

The trial judge, Justice Lateefat Okunnu, adjourned till Thursday (today) for further cross-examination of the witness which was disrupted when the defence notified the court that the prosecution had filed an additional proof of evidence.

(punch)