News
Minister For Works, Fasola In N166B Contract Mess (FG orders probe)
The Bureau for Public Procurement (BPP) has queried the Minister of Works, Power and Housing, Babatunde Fashola over the award of 10 road and bridge contracts worth N166 billion.
The BPP said the minister and his ministry violated the laws guiding contract awards in Nigeria in the manner they selected contractors for the projects.
The procurement agency is asking Mr. Fashola to explain, among other things, why the costs of some of the projects were inflated and why some were awarded to unqualified firms.
The construction of the roads and bridges, spread across the country, were appropriated for in the ministry’s 2016 budget.
The projects are the rehabilitation of Numan-Jalingo Road awarded to Deux Projects Ltd for N11.7 billion; replacement of substandard bridges along Gusau-Sokoto Road awarded to Triacta Nig. Ltd (N1.01 billion); construction of Ojutu Bridge in Ilobu, Osun State awarded to Halicass Integrated Ltd (N522.2 million); construction of Ohan-Moro Bridge on Ilorin-Igbeti Road awarded to Bonus Nig. Ltd (N942.6 million); and rehabilitation of Abuja-Kaduna Road awarded to CGC Nig. Ltd (N26.9 billion).
Others are rehabilitation of Kaduna-Zaria Road in Katsina State awarded to Arab Contractors Nig. Ltd for N14.8 billon; rehabilitation of Zaria-Kano Road in Kaduna/Kano State awarded to Reynold Construction Nig. Ltd (N69.9 billion); and the construction of Burga-Dull-Mbatill-TadnumGpbiya-Badagari-Gwaranga-Sum, Bauchi State awarded to Rahama Civil Works Nig. Ltd (N10.9 billion).
The construction of Tudun Wuss-Wandi-Wandi-Baraza-Durr-Zumbul-Polchi-Dot-Kwanar Road, Bauchi State awarded to Dalum Construction Nig. at N12.2 billion and the construction of Pankshin-Tapshin-Gambar-Sara-Kai-Gindiri Road in Plateau State awarded to Metropolitan Construction Company Limited at N15.3 billion are also among the contracts slated for award by the ministry.
How contracts were awarded
In line with the requirement of the Public Procurement Act, 2007, Mr. Fashola’s ministry had, in a letter dated November 7, 2016, requested the Bureau to issue it Due Process Certificate of “No Objection” for the award of the 10 contracts.
The ministry had earlier in June advertised the projects in some national newspapers as well as the Federal Tenders Journal edition of Monday May 30- June 10, 2016.
An addendum to the advertisement was further placed in the same newspapers and Federal Tenders Journal of Monday June 13-Sunday June 26, 2016.
On July 25, 2016, the prequalification documents were opened in the Conference Room of the ministry in the presence of representatives of prospective contractors, non-governmental organisations, the Nigeria Society of Engineers and some member of the public as well as officials of the ministry.
In line with Part V, Clause 22, Section 4 of the Pubic Procurement Act (PPA) 2007, the Permanent Secretary/Chairman of the Ministerial Tenders Board constituted a Technical Evaluation Committee to evaluate the tenders received from prospective contractors.
The contractors successful in the technical evaluation exercise were “provisionally prequalified”, with their documents forwarded to the Federal Inland Revenue Service (FIRS), and banks for verification.
They were subsequently invited to submit completed financial tender documents.
The ministry then carried out a verification exercise on some of the claims made by bidders in their technical bids.
After the verification exercise, the ministry wrote to the BPP to request certificate of no objection for the recommended contractors.
BPP’s response
However, the BPP objected to the award of the contracts citing various violations of the PPA Act.
The agency, in a report on the projects, exclusively obtained by PREMIUM TIMES, said it would not grant the ministry due process certificate until its concerns were “adequately addressed”.
The report was signed by the Director General of the BPP, Mamman Ahmadu.
In the 64-page report, the Bureau objected to the award of the contracts because “there are no evidences that feasibility and financial/economic studies were conducted during projects’ preparation.”
It also expressed surprise that the ministry failed to prepare Environmental Impact Assessment (EIA) for the projects.
It said, “There are no evidences that the EIAs were prepared for the Projects and specifically no EIA Reports were submitted for this Due Process Review. The Federal Ministry of Power, Works and Housing should note that Environment Impact Assessment is a very crucial aspect of project preparation.”
Furthermore, the BPP condemned the ministry for failing to submit the technical bids for the companies that participated in the pre-qualification exercise.
“The FMPW&H did not recommend the lowest bidders for most of the lots after prequalifying the firms,” the agency said.
“The Bureau further observed that FMPW&H appears to have erroneously categorized some critical projects in such a way that enables contractors that are not in the same category with similar technical and financial capacities to submit bids for such lots.
“This has made the bench-marking and value-for-money checks almost unfeasible and has opened avenues to subject the procurement processes to many frivolous petitions and counter-petitions that could likely delay the immediate commencement of the projects.”
More bashing
Commenting specifically on each of the 10 projects one after the other, the Bureau noted that although the ministry recommended the lowest contractor for the N11.7 billion Numan-Jalingo Road project, most of the companies that submitted bids for the project were not in the same category and ranking that would enable proper bench-marking.
“Besides, the capacity of most of firms to upgrade and extend the quality of the design and standard of this road cannot be guaranteed,” it stated further.
The Bureau therefore advised the ministry to carry out post-qualification on all the firms that submitted bids for this Lot to verify their actual capacities and eliminates firms that do not have technical and financial capacity to execute the project.
On the replacement of substandard bridges along Gusau-Sokoto Road, the Bureau said the ministry considered the submission of Messrs. China Zhonghao and Ric Rock Construction Ltd that submitted the third and fourth lowest bids non-responsive.
It however noted that the basis for their disqualification was not made known by the ministry.
It asked the ministry to carry out post-qualification on all the firms that submitted for this Lot to verify their actual capacities and eliminate firms that do not have the technical and financial capacity to execute this project.
On the construction of Ojutu Bridge in Ilobu, Osun State, awarded to Halicass Integrated Ltd for N522.2 million, the BPP said the ministry indicated that the rates of the lowest four tenderers were too low while two of the contractors submitted bid securities that were not up to two percent of the contract sum as requested.
It also said the ministry indicated that the submission of Messrs. Metropolitan International Limited was corrected from N704,089,909.48 to N122,430,000.00, which showed the firm lacked the understanding and capacity to execute a project of that magnitude and complexity.
The Bureau said it observed that the actual corrected sum of the company submitted as carried out by FMPW&H and verified by the Bureau was N700,761,140.33.
“Nonetheless, the Bureau is amazed with the ministry’s comment on Messrs. Metropolitan International Limited for this project, whereas the ministry has recommended the firm for a bigger project of N15,385,310,166.29 [Pankshin-Tapshin-Gambar-Kal-Gindiri Road].”
The Bureau wondered why the ministry did not recommend Bilijoe+Berger Nigeria Limited for the construction of Ohan-Moro Bridge on Ilorin-Igbeti Road which was awarded to Bonus Nig. Ltd at N942.6 million despite its (ministry) claiming that the company’s price was reasonable.
The ministry, according to the Bureau, indicated that the rates of the lowest tenderer, Messrs. Blisswood Associates Limited were too low, while the submission of Messrs. Bilijoe+Berger Nigeria Limited, the second lowest tenderer, was considered reasonable.
It however wondered why the job was not given to the company even though their submission was lower than that of Messrs. Bonus by N2,228,052.75.
The Bureau said it was not able to verify the ministry’s claim that Messrs. Calipak Nigeria Limited and Fiphs Investment Limited submitted bid securities that were not up to two percent of the contract sum as requested because the bid securities were not forwarded to it.
The BPP expressed surprise at the ministry’s claim that it did not award the rehabilitation of Abuja-Kaduna Road awarded to Messrs. Gilmor Nigeria Limited because its jobs were mostly in irrigation and housing with very few district roads within Abuja and with no completion certificate.
The Bureau noted that from its own database, the company was categorised under category A with an average turnover of over N15 billion in the last three years contrary to the viewpoint of the ministry.
“Messrs. Gilmor Nigeria limited has the necessary equipment, professional expertise and personnel to undertake a project of over N10 billion,” it said.
“Messrs. Gilmor has contracts worth over N36 and N40 billion for the development infrastructure facilities for Guzape district I &II and Jahi district respectively.”
The Bureau requested the ministry to provide it with details of why Messrs. Dantata & Sawoe, Setraco Nigeria Limited and RCC 7& CO Nigeria Limited were disqualified since it (ministry) did not give reasons for doing so.
The Bureau demanded explanation on why the ministry prequalified Messrs. Kaiba International Nigeria Limited and Olivec Ventures Limited for the rehabilitation of Kaduna-Zaria Road in Katsina State despite not having annual turnover of up to the required N10 billion.
It said the firms had an average turnover of about N250 million and ought not to have been prequalified.
On the rehabilitation of Zaria-Kano Road in Kaduna/Kano State awarded to Reynold Construction Nig. Ltd at N69.9 billion, the BPP expressed concern about the “excessive unit rates” posted by the company for the project, saying they were “not commensurate rates with similar rates posted by other contractors with similar ranking that submitted bids for similar projects.”
It added, “The Bureau is bemused why the cost of the Kano-Zaria axis that is about 78km. Furthermore, the cost of approximately 2.5 times the cost of Abuja- Kaduna that has about the same distance. The Bureau is not convinced that there was competition for this Lot.”
It therefore requested the ministry to re-examine the submission of Messrs. RCC and ensure that the contract price was realistic that would give government best value for money.
The Bureau said Messrs. Rahama Nigeria Limited should not have been given the contract to construct the N10.9 billion Burga-Dull-Mbatill-Tadnum Gpbiya-Badagari-Gwaranga-Sum road.
According to the Bureau, the company with an average turnover of about N250 million entered into a joint ventures agreement with Messrs. F.I.K Global Limited in order to meet the N2 billion minimum turnover requirements.
“However, it was also observed that Messrs. F.I.K Global Limited also submitted tender separately for this same project. Messrs. F.I.K Global Limited tender in the sum of N11,225,398,261.78 was ranked fourth lowest bid,” it said.
“However, this action by the two firms amounts to bid-rigging and is contrary to section 58[10] of the public procurement act, 2007. This has rendered the submissions of both firms non-responsive.”
Nevertheless, the Bureau asked the ministry to carry out post-qualification on all the firms that submitted bids in this Lot to confirm the actual capacities and eliminate firms that do not have the technical and financial capacity to execute this project.
On the construction of Tudun Wuss-Wandi-Wandi-Baraza-Durr-Zumbul-Polchi-Dot-Kwanar Road, Bauchi State at Dalum Construction Nig. Ltd, the Bureau observed that the companies that submitted bids for this Lot were not in the same category and ranking to enable proper benchmarking.
It noted that the capacity of most of the firms to upgrade and extend the quality of the design and standard of this road could not be guaranteed.
The Bureau further said the Lot may likely end up with series of petitions due to the outcome of the evaluation exercise.
It therefore asked the ministry to carry out post-qualification on all the firms that submitted bids.
On the Pankshin-Tapshin-Gambar-Sara-Kai-Gindiri Road in Plateau State, the Bureau said though the FMPW&H indicated that the rates of Messrs. CBC Global Nigeria, Well Town Stone Nigeria limited, Hypertek Limited, Bonus Limited, Xedex Nigeria Limited and Duex Limited that submitted the lowest to the six corrected tenders were reasonable, the ministry did not however indicate why the lowest tenders of Messrs. CBC Global was not recommended.
The Bureau observed that the technical evaluations for all the projects were not carried out professionally and was therefore surprised that the ministry refused to recommend the lowest bidders after prequalification exercise which was an indication of credibility.
“This has cast doubt about the integrity of the technical evaluation process,” the BPP said.
“As the federal government is committed to improving the road network within the country with such huge resources allocated towards the projects, it has become necessary to learn from past failure so as to avoid repeated problems in the future that will result in a waste of the limited economic resources.
“The need to ensure that the scopes of works cover all major concerns and only competent contractors are recommended has therefore become very imperative so as to prevent loss of valuable lives, properties and resources that always accompany such failure.
“Therefore, the FMPW&H is requested to furnish the Bureau with comprehensive details of the scope of work in the BEME for all the projects sufficient to demonstrate how the qualities were derived.”
When PREMIUM TIMES contacted Hakeem Bello, the minister’s spokesperson, he declined comment on the Bureau’s report, saying he does not speak for the ministry but for the minister.
A staff of the ministry, who only identified herself as Grace told this newspaper on phone that she was not aware of the report.
Some officials of the works ministry however wondered why the BPP asked the ministry to go through another process of post-qualification of firms after all award processes have been completed.
“What the BPP should have done is to compel the ministry to choose the most qualified contractor with the lowest bids,” an official said. “Allowing for any kind of post-qualifications is like changing the rules in the middle of the game.”
Credit: Premium Times
News
Panic As Governor’s Official Car Got Stolen
Confusion and fear was the order of the day at one of the Government houses in the Southwest some days ago when one of the official vehicles of the Governor, a bullet-proof jeep allegedly disappeared from the garage.
The SUV which is said to be one of the three bullet-proof vehicles being used for the Governor’s official assignment was discovered missing.
The Governor who was out of the country on a short, rest leave was claimed to have been disturbed when he was alerted.
Sources claimed it wasn’t the first time things would get missing at the Governor’s private residence.
‘There had been series of thefts, ranging from missing cash, phones and other expensive items, it’s usually swept under the carpet. Indiscipline is the order of the day here’, a source confirmed this to papermacheonline.
The State Governor, a quiet individual who is spending his second time in office was said to have been disturbed by the occurrence that he had to cut short his leave and return home. One of his closest aides was also kidnapped recently.
Business
Former First Bank Employee Accuses Oba Otudeko, Bisi Onasanya Of Massive Fraud
A former First Bank of Nigeria Limited employee, Adesuwa Ezenwa, has accused billionaire industrialist Oba Otudeko and former Managing Director Bisi Onasanya of massive fraud during Otudeko’s tenure as chairman of FBN Holdings Plc.
In court documents filed at the National Industrial Court of Nigeria, Ezenwa alleges that unsecured loans of approximately N12 billion were granted to a company in which Otudeko has significant investments, disguised as loans to Stallion Group of Companies.
Ezenwa, who was summarily dismissed in October 2016, is seeking redress for her termination and demanding N500 million in damages and N25 million in legal costs. She claims that she was made to bear the consequences of granting unsecured loan facilities worth billions of naira to companies linked to Otudeko and Onasanya, while her superiors who approved the credit were not penalized.
Ezenwa joined First Bank in 2002 and became a relationship manager in the corporate banking division in February 2016. She alleges that her superiors, including Abiodun Olatunji and Cecilia Majekodunmi, who worked closely with Onasanya, were involved in the fraudulent activities.
“As a relationship manager, I worked under the supervision and direction of my branch manager and group head and signed official correspondence only after they had approved and/or signed same. I had no independent authority in relation to the grant or disbursement of loans or other banking facilities,” Mrs Ezenwa said.
According to the claimant, she executed a large number of documents while she was still employed by First Bank, but only after approval by her bosses and on their direction.
She said she was summoned on 25 August 2015 to appear before a credit disciplinary committee reviewing facilities availed to a company known as Supply and Services Limited, a subsidiary of Royal Ceramics Group, one of the major customers of the bank.
The plaintiff said the committee could not determine whether she had a personal interest in any of the loans granted or whether she made any gain related to her duties. She said she was, however, blamed during proceedings for not whistleblowing on some of the deals endorsed by Mr Olatunji and Mrs Majekodunmi.
“The admonition was most unfair and unwarranted as I was in no position to whistleblow on my superiors … The persons to whom these reports would have been made were the very persons who were the perpetrators of the misdeeds,” she said.
A litany of allegations against Mr Otudeko
Mrs Ezenwa disclosed that unsecured loans of roughly N12 billion were availed, on one occasion, to a company in which Mr Otudeko has significant investment even though the facility was masked as loans granted to Stallion Group of Companies, which later spotted the false entry in its statement of account and complained.
In one case in 2012, she further alleged, an unsecured credit estimated at N2 billion was granted to Broadwaters Resources Company Nigeria Limited, which ended up being a conduit pipe used by Mrs Majekodunmi and Mr Onasanya to siphon monies from the bank. The claimant said the loan was never repaid.
“Out of the N12 billion camouflaged as lending to the Stallion Group, N8.21 billion was transferred through various accounts to a final destination account belonging to a company known as V-TECH LTD, which belongs to the chairman of FBN Holdings, Oba Otudeko, while the sum of N4.45 billion out of the same fictitious facility was transferred to Ontario Oil and Gas. The facility remains unpaid to date,” Mrs Ezenwa said in court fillings.
According to her, several similar loans were granted by Mr Olatunji and Mrs Majekodunmi, including to Supplies and Services Limited, which were “subsequently sublet and disbursed in smaller bits to several customers on more profitable terms to both officers.”
Swap Technologies and Telecomms Plc, Orbit Cargo, Netconstruct Nigeria Limited, and High-Performance Distributions Limited were among the companies named as beneficiaries of the loan disbursement.
Mrs Ezenwa disclosed that such loans could not have been granted without the involvement of the board of First Bank, considering that the amounts involved were huge and above the approval limits of the executive directors, the vice president and the managing director of the bank.
According to the complainant, her dismissal by the bank brought her into disrepute, threatening her chances of securing employment in reputable companies in future.
“The action of the defendant (First Bank) has consequently caused the claimant untold mental distress and is all the more damaging as the claimant is in her thirties and has simply been made a scapegoat for the malfeasance of some of the lapses of the management of the bank,” she said.
Among other demands, Mrs Ezenwa is urging the court to declare that there was no basis for the bank to dismiss her.
“She is being made a scapegoat for a lot of questionable transactions within the bank, which she is claiming innocent of,” Seyi Sowemimo, the claimant’s lawyer, told PREMIUM TIMES on Saturday. “So far, the trial has started. We have subpoenaed the EFCC, and we have subpoenaed the central bank to bring the audit reports of the bank,” Seyi Sowemimo, the claimant’s lawyer, told PREMIUM TIMES.
The allegations have sparked a legal battle, with Ezenwa seeking justice for her dismissal and damages for the fraudulent activities she claims to have uncovered.
Business
“AMCON MD In Trouble Over Keystone Bank Acquisition By Father In-law”, Isa Funtua
Why Bank Customers Are Making Panic Withdrawals…
Following the controversy generated by the leading opposition party, the People’s Democratic party, PDP, over the alleged acquisition of Keystone bank and Etisalat by Alhaji Isa Funtua and the CEO of AMCON, Ahmed Kuru, President Muhammadu Buhari has ordered probe into the alleged fraud.
A highly placed source at the headquarters of the Economic and financial crimes Commission, EFCC yesterday told daybreak that the President was thoroughly embarrassed with the allegations linking him to the transactions.
According to the source, a discrete panel will be set up soon comprising of the Chairman of the EFCC, representative of the DSS, ICPC, federal ministry of Justice to look into the allegations.
The source further added that, both Isa Funtua, Ahmed Kuru, the governor of the central bank of Nigeria, CBN, Chief Godwin Emefiele and management Staff of the Keystone Bank and 9Mobile will be quizzed by the operatives of the EFCC for some interactions.
Recently, a mindboggling scandal broke out to public knowledge about how Keystone Bank and 9Mobile were acquired in controversial circumstances by the business interests of one Alhaji Isa Funtua, a close friend of President Muhammadu Buhari, via the instrumentality of Asset Management Corporation of Nigeria (AMCON).
The PDP challenged the federal government to come out clean on what could be a serious dent on its anti-corruption stance, there is indeed no smoke without fire.
The leading opposition party also confirmed fact that the son-in-law of Isa Funtua, Ahmed Kuru, is the current CEO of AMCON.
Before him, the previous CEO, Chike Obi, was a first-class gentleman and technocrat who was strangely removed from office before the expiration of his term and was replaced with Kuru, the son-in-law of Isa Funtua.
Now, let us get into the insider details of how Funtua bought Keystone Bank and 9Mobile in the most bizarre of dealings that circumvent the laws of the land. Keystone Bank was sold by the current CEO of AMCON to his father-in-law, Funtua, without any AMCON Board’s approval and with the active connivance of CBN and NDIC at a grossly undervalued price of 25 Billion Naira. To put things in context, let us recall that Enterprise Bank was sold for over 60 Billion Naira and Mainstreet Bank was sold for over 100 Billion Naira under the former CEO of AMCON.
Before the sale of Keystone Bank to Isa Funtua, all bad debts in the books of the Bank were taken over by AMCON. So, it was a clean Bank with all the Assets and no Liabilities that was sold to the Buyers.
The Executive Management of AMCON was coerced into approving the transaction and those who were willing to submit a much higher bid were disqualified under a most opaque, suspicious process that lacks all transparency. The process was just manipulated in favour of the father-in-law of the AMCON CEO.
The Corrupt Payment for Keystone Bank The most disgusting part of the entire sale of Keystone Bank is how the 25 Billion Naira sales price was paid to AMCON.
The Isa Funtua Team paid 5 Billion Naira to AMCON, and then the balance of 20 Billion Naira was later paid through the most criminal and corrupt approach ever perpetrated by AMCON in favour of the Buyer. What happened was that AMCON moved 20 Billion Naira of their own funds as a fixed deposit at GTBank to Heritage Bank. Heritage Bank then paid the 20 Billion Naira on behalf of the Funtua Group to AMCON. In other words, AMCON used their own funds as a collateral for a loan to the Funtua Group for 20 Billion Naira!
When the Funtua Group took over Keystone Bank, they went borrowing immediately at the Interbank Market for 20 Billion Naira to refund AMCON’s funds. This has left a hole in Keystone Bank’s Balance Sheet and makes the Bank one of the most undercapitalized Banks in the Country as at today. The evidence of this highly compromised acquisition process can be obtained from the current and former staff of AMCON, from NDIC, CBN and from the current staff of Keystone Bank itself.
Another suspicious acquisition scandal surrounding the Funtua Group is about the untidy way 9-Mobile, formerly known as Etisalat, was bought. It is Mr. Adrian Wood of Teleology Holdings, a very sound telecoms professional, who collaborated with the Funtua Group for the acquisition of 9-Mobile.
The problem with their bid was the lack of a qualified Operator to support the bid which was one of the minimum conditions of NCC. Adrian Wood alone was not a substitute for an Operator.
The Nigerian Communications Commission (NCC) gave several conditions that must be met by the Ultimate Buyer of 9-Mobile to ensure the protection of shareholders value, prevent loss of jobs, protect the telecoms industry from slipping into a crisis and ensure transparency and professionalism in the post-acquisition entity.
The conditions listed by NCC that must be met by the Buyer are Strong Telecoms Operating Experience, Strong Financial Capabilities, Strong Technical Knowledge and Strong Administrative Skills.
The first thing that happened once Teleology was announced as the preferred winner was that the Funtua Group edged Adrian Woods out of Management and turned him to an Insignificant Shareholder.
The second development was that the Funtua Group raided Keystone Bank again and forced the Bank to Pay 50 million Dollars as down payment for the acquisition of 9-Mobile.
The third issue was that Teleology Nigeria replaced Teleology Holdings to remove any influence of Adrian Woods from 9-Mobile totally. The fourth step taken the Funtua Group was to borrow 260 Million Dollars from African Exim Bank.
The fifth thing was to coerce NCC to approve the sale at all cost without meeting 90% of the conditions set up ab-initio by the NCC.
The sixth strange action of the Funtua Group was to force the board of NCC to approve the sale through the influence and pressure from the Presidency. And the seventh Funtua infraction was to use the influence of CBN to force the Banks to the table and waive their own conditions of sale of 9-Mobile to the Teleology Nigeria group.
Efforts to reach the acting Head media and publicity of Economic and financial crimes Commission,EFCC, Mr. Tony Orilade to confirmed the latest developments proved abortive as his lines were not connecting.
Source; The Capital
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