$875m Malabu fraud: London court Okays FG’s suit against US bank

Nigeria has been granted permission to proceed with its case against an American bank JPMorgan Chase accused of enabling the misappropriation of state funds totalling $875m over the Oil Prospecting License, OPL 245.

The Attorney General of the Federation and Minister of Justice, Mr Abubakar Malami (SAN), said this on Friday in a statement by his Special Adviser on Media and Publicity, Mr Salihu Isah.

The fraud was said to have been committed through Malabu Oil and Gas Company controlled by a former Minister of Petroleum, Dan Etete.

Isah said in the statement that a 26-page verdict of a London High Court presided by Justice Andrew Burrows ruled on Thursday that Nigeria had “reasonable grounds” for bringing a claim to the commercial division of the high court.

According to him, the court’s verdict implied that Nigeria could now proceed to trial against the bank.

Isah quoted the judge as saying, “The defendant bank has failed to establish that the claimant has no real prospect of success.”

According to the judge, the bank ought to suspect that the payments were fraudulent and therefore had a duty to protect the Federal Republic of Nigeria until its concerns were cleared up.

“That duty of care entails that the defendant bank could not simply follow the mandate of abiding by the instructions given by the claimant because the bank’s duty of care, as its core, was to protect the claimant against being defrauded by not paying out unless and until it was off inquiry,” the judge was quoted as saying in the statement.

JPMorgan Chase was said to have argued earlier this month that the Nigeria’s case should be dismissed on the grounds that it received approval from Nigerian authorities before allowing the transfer of funds from a government account to the ones controlled by Etete, who is convicted of money laundering.

The payments, after a 2011 settlement, aimed to end years of battle over the ownership of a lucrative but controversial oil licence that has ensnared Royal Dutch Shell and Eni in corruption investigations in Milan, Italy.