Govt recovers N46b from sale of FCT houses

THE Federal Government has recovered N46 billion, which were the proceeds from the Federal Government-owned houses sold through public auction by the immediate past administration of Olusegun Obasanjo.

The money was yet to be remitted into the Federation Account at the Central Bank of Nigeria (CBN).

The fund had since been warehoused in 15 banks in the country for which no reasonable interest had accrued, though it is alleged that some government officials at the centre of the management of the funds had enriched themselves through a deal struck with the banks.

The recovery of the funds by Minister of State for Finance, Mr. Remi Babalola, who also doubles as the Supervising Minister of the Federal Capital Territory (FCT), followed a directive to that effect by President Umaru Musa Yar'Adua, which he accordingly issued a threat to the affected banks' chiefs that they would be taken before the Economic and Financial Crimes Commission (EFCC) should they fail to present their drafts in a week's time.

Babalola is a former Executive Director of First Bank of Nigeria Plc.

The ultimatum to pay up the funds expired at the weekend and a Central Bank of Nigeria (CBN) source yesterday confirmed to finance reporters that the 15 affected banks had complied by refunding the various sums they had held for more than one year.

The source revealed that 75 per cent of the proceeds (about N34.5 billion) was paid into the Federal Government's account in the apex bank, while the balance of 25 per cent (N11.5 billion) was remitted to the FCT's account in the CBN.

The official said: "I can confirm to you that all the affected banks have complied with the presidential directive to remit the proceeds from the sale of houses in FCT. The 15 banks in possession of the money, have all paid the funds back into the treasury. The amount involved is over N46 billion."

President Yar'Adua had two weeks ago during a meeting with some top government officials directed Babalola to immediately recover the proceeds from the banks into the treasury.

Following futile attempts in the past 12 months to get the banks to remit the money, it was learnt that the Federal Government had through the Minister of Finance, Shamsuddeen Usman, in August 2008 also directed the FCT administration to remit the money into the treasury, but the directive was not apparently enforced.

The source, however, explained that the presidential directive became necessary due to the decision of the Federal Government to wind up the activities of sale of Federal Government's properties.

Besides, the official disclosed that the proceeds from the sale of the houses had been captured under government's revenue in the 2008 budget as a financing item.

Former President Olusegun Obasanjo had in 2005 approved the sale of Federal Government houses nationwide, including the FCT, in line with the government's monetisation policy.

The houses were sold to civil servants and the public through mortgage loans from banks and buyers were required to pay 10 per cent as deposit for the houses.

Findings at the CBN also confirmed that the last batch of the proceeds was remitted last week by the banks.