Can EFCC probe States’ financial dealings? By By ERIC IKHILAE

EFCC

Rivers and Oyo states have challenged the powers of the Economic and Financial Crimes Commission (EFCC) to investigate their finances. Are they right? Legal experts think otherwise. They spoke with ERIC IKHILAE.

Moved by the pressure from the Financial Action Task Force on Money Laundering (FATF), Nigeria established the Economic and Financial Crimes Commission (EFCC) on April 13, 2003.

The FATF, an intergovernmental agency founded in 1989 by the G7 countries as a measure against money laundering, had ranked Nigeria among the 23 nations that were most un-cooperative in the global war against money laundering.

The EFCC has, since its establishment, engaged in a series of investigations, prosecution and recovery of illegally-acquired assets, among others. It has also been subjected to attacks by individuals and groups, who queried the extent of its jurisdictional competence.

Those who have continued to question the power of the EFCC to investigate states’ finances have held on to the doctrine of federalism to argue that each tier of government is expected to govern its own affairs by a set of laws made by its legislative arm.

They contend that a federal agency like the EFCC lacks the competence to try an offence relating to funds or property belonging to a state government.

The most recent of such is the contention by the Governor of Rivers State, Nyesom Wike, who, in May argued that the EFCC lacked the power to investigate his state’s financial dealings.

Wike, who relied on some High Court decisions, spoke shortly after the EFCC, in May this year, declared the Accountant-General of River State, Fubara Siminayi, and some other officials of the state wanted over an alleged N435 billion fraud.

Before Wike, the Commissioner of Information, Culture and Tourism in Oyo State, Wasiu OLatubosun, made a similar argument shortly after the EFCC arrested the state’s Accountant-General, Gafar Bello in relation to alleged money laundering activities.

Olatubosun said: “The EFCC and its officials have, since last year, been mounting pressure on Oyo State and its officials to provide documents regarding disbursements and expenditure of the Consolidated Revenue Fund, Contingencies Fund and Security Vote lawfully approved and passed into Appropriation Law of Oyo State by the Oyo State House of Assembly. This is despite the fact that the Supreme Court of Nigeria has decided in a long line of cases that the EFCC lacked the powers to prosecute issues that are not corruption cases.

“We would like to put it on record that by virtue of Section 128 (1) and (2) of the Constitution of the Federal Republic of Nigeria 1999, unless and until the Oyo State House of Assembly reports or exposes any corruption, inefficiency or waste in the execution or administration of laws within its legislative competence and in the disbursement or administration of funds appropriated by it to the Executive Governor of Oyo State and Commissioner for Finance, Section 6 (h) of the EFCC Establishment Act 2004 (as amended) cannot be triggered.

“The Oyo State House of Assembly has not made any such reports and thus the actions so far, by the EFCC and the EFCC Chairman are unconstitutional and ultra-vires.”

What the law says:

To understand the scope of EFCC’s powers, the proper place to look is the EFCC (Establishment) Act 2004 which empowers the commission to engage in the investigation, prosecution and prevention of economic and financial crimes throughout the Federation, with the mandate to investigate and prosecute economic and financial crimes in all parts of the federation.

Some of the key provisions are contained in sections 6, 7 and 13. Section 6 deals with the functions of the EFCC; Section 7(1) and (2) captures the powers and responsibilities of the commission, while Section 13(1) and (2) creates special duties for certain units of the EFCC.

Section 7(1) says “the commission has power to – (a) cause investigations to be conducted as to whether any person, corporate body or organisation has committed any offence under this Act or other law relating to economic and financial crimes, (b) cause investigations to be conducted into the properties of any person if it appears to the commission that the person’s lifestyle and extent of the properties are not justified by his source of income.

Section 7(2) charges the EFCC with the responsibility of enforcing the provisions of the Money Laundering Act 2003; the Advance Fee Fraud and Other Fraud Related Offences Act 1995; the Failed Banks (Recovery of Debts) and Financial Malpractices in Banks Act 1994 (as amended); the Banks and other Financial Institutions Act 1991 (as amended); the Miscellaneous Offences Act, and any other law or regulations relating to economic and financial crimes, including the criminal code or penal code.

Section 13(1) provides that the General and Assets Investigation Units of the commission “shall be charged with responsibilities for the prevention and detection of offences in violation of the provisions of this Act; the arrest and apprehension of economic and financial crime perpetrators; the investigation of assets and properties of persons arrested for committing any offence under this Act; the identification and tracing of proceeds and properties involved in any offence under this Act and the forfeiture of such proceeds and properties to the Federal Government; and dealing with matters connected with extradition and mutual assistance in criminal matters involving economic and financial offences.”

Section 13(2) provides that the Legal and Prosecution Unit “shall be charged with responsibility for prosecuting offenders under this Act; supporting the general and assets investigation unit by providing the unit with legal advice and assistance whenever it is required; conducting such proceedings as may be necessary towards the recovery of any assets or property forfeited under this Act, and performing such other legal duties as the Commission may refer to it from time to time. ”

Judicial interpretations of EFCC’s power to investigate states

Many lawyers, including Daniel Makolo and Abdulaziz Abubakar, are of the view that the issue of whether or not the EFCC could probe states’ financial transactions has been effectively dealt with in a number of Supreme Court cases, including those of the A.G of Ondo State v. A.G Federation (2002) 19 NWI R (PT 779); Orji Kalu v. FRN; Dariye v. FRN (2015) 10 NWLR (PT.1467); Nyame v. FRN [201 01 7 NWLR (PT.1193 and Nwobike v. FRN.

In the cases, the Supreme Court was of the view that the powers to prosecute an offence is not determined by the ownership of the property alleged to have been stolen, adding that it was the responsibility of the EFCC to prosecute the offence of financial crimes.

In the Nyame case, the Supreme Court held, among others, that “Generally speaking, the power to prosecute for an offence is not determined by the ownership of the property allegedly stolen or misappropriated.

“The determining factors are namely – who can exercise prosecutorial power over the offence, the nature of the offence charged and where the offence is committed.

“The Federal Government created the Economic and Financial Crimes Commission by an Act of the National Assembly in 2004….

“It is not a defence known to law that an accused person cannot be prosecuted by the authority with prosecutorial powers on the ground that the prosecutor is not the owner of the stolen items.

“Criminal offence is an offence against the state. A prosecutor need not have an interest in the subject matter of the complaint before he can prosecute an accused person. He is protecting the state and its citizens and every prosecutor or authority or agency vested with the powers to prosecute should be encouraged to carry out their duties, provided that the due process is maintained and followed.”

In his lead judgment in the Dariye case, Justice Sylvester Ngwuta (now late) said: “Issue three is whether or not the respondent (the EFCC) has powers to prosecute the appellant (Joshua Dariye, ex-governor of Plateau State) in view of the fact that the subject matter of the charge does not belong to the Federal Government, but is the property of the Plateau State Government.

“First, as rightly pointed out by the learned senior counsel for the respondent, the offences are charged under the provisions of the Penal Code which is a Federal legislation.”

The justice noted that for a Federal indictment, the Attorney-General of the Federation, by himself or through an agent, may prosecute such offences alleged.

“The owner of the subject matter of the charges is immaterial. What is material is that a Federal enactment has been violated.

“It follows from the above, and this was the opinion of this court in A.G of Ondo State v. A.G Federation (20021 9 NWI R (PT 779) 777 of 308 that generally speaking, power to prosecute for an offence is not determined by the ownership of the property allegedly stolen or misappropriated…”

In a judgment in 2018, Justice Nnamdi Dimgba (then of the Abuja division of the Federal High Court) ruled that the EFCC has the power to investigate the finances of a state government without the authorisation of the state’s House of Assembly.

Justice Dimgba disagreed with two earlier judgment’s by Justices Ibrahim Buba (then of the Port Harcourt division) and Taiwo Taiwo (then of the Ado-Ekiti division) in which they held that EFCC’s investigation of the finances of state governments, without the authorisation of their Houses of Assembly, was a violation of the principles of federalism.

The judgment was on a suit by the Benue State Government, filed through the state’s Attorney General to challenge the powers of the EFCC to investigate its accounts and officials, without the authorisation of the state’s House of Assembly.

Justice Dimgba was categorical when he said: “I have reflected on the judgments issued by the Port Harcourt division of this court in AG Rivers State v EFCC & 3 Others in Suit No: FHC/PH/CS/78/07, delivered on March 20, 2007, and that by the Ekiti Division of this court in Suit No: FHC/AD/CS/32/2016; A.G of Ekiti State v. EFCC & 17 Others, both of which have been brought to my attention.

“Both judgments hold that following the principles of federalism and separation of powers, only a state House of Assembly can investigate the financial administration of a state and that the 1st defendant, the EFCC, lacks the powers to investigate state finances.

“With the greatest deference to my brothers, who hold such views, I take a different view, and for the reasons already explained above, I am of the view that it is not a proposition that is borne out of a proper construction of Sections 125 to 129 of the constitution juxtaposed with the powers of the 1st defendant (EFCC) under the EFCC Act.”

Relying on Supreme Court’s decisions, Justice Dimgba added that “generally, the EFCC is empowered to investigate and prosecute all economic and financial crimes as defined in Section 46 of the EFCC Act.”

He held that the EFCC possesses the power to prosecute all financial crimes “created and punished under other penal statutes, including those enacted by the states of the federation.”

The judge further held that the EFCC’s investigative powers were not limited by geographical or territorial boundaries or federalist structures.

He noted that “as a matter of fact, the powers to fight corruption which have been donated to the 1st defendant under Sections 6, 7 and 38 of the EFCC Act are very broad and are not confined or limited to geographical or territorial boundaries, or limited by boundaries set by the federalist structure of Nigeria.

“Indeed, the definition of economic and financial crimes under Section 46 of the EFCC Act is so broad that it arises even in the context of the management of the financial resources of a state.”

Justice S. K. Idris (then of the Federal High Court, Sokoto division) held a similar view in the case filed by the Attorney General of the state against the EFCC and the Independent Corrupt Practices and other related offences Commission (ICPC).

Sokoto State had, by the suit, sought to restrain the ICPC and the EFCC from carrying out any anti-corruption duties on any official or government department of the state on any matter or issue which the State House of Assembly could legislate on.

Justice Idris, in dismissing the case, held that the Federal High Court was bound by the decision of the Supreme Court in the case of AG Ondo v. AG Federation (2002) which upheld the constitutionality of both the ICPC and EFCC Acts as enacted by the National Assembly, being applicable and binding on every state, person and authority in Nigeria, including Sokoto State.

The judge noted that the ICPC and EFCC have been empowered by Acts of parliament to perform the duties of fighting corruption in all the 36 states of the federation and the Federal Capital Territory (FCT).

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