18 Aug State governments sue FG over Recovered Loot
The 36 states of the Federation have jointly sued the federal government at the Supreme Court over alleged illegal diversion of over N1.8 trillion in recovered loot.
Also allegedly diverted by the federal government, according to the plaintiffs, are N450 billion worth of non-cash assets recovered proceeds of crime since 2015.
The plaintiffs alleged that, instead of paying the cash into the Federation Account, the federal government illegally diverted it into the Consolidated Revenue Accounts (CRA) and other accounts not recognised by the Nigerian constitution.
A “common pool of all revenues of the federation of Nigeria”, the Federation Account houses the funds that are meant to be shared among the federating units based on agreed revenue sharing formula, the plaintiffs explained in an affidavit filed in support of the suit.
On the other hand, the CRA, according to the plaintiffs, is the account into which the federal government’s share from the Federation Account, other federal earnings, and funds belonging to specific state governments are paid.
Other federal earnings payable to the CRAs include receipts from federal government licenses and land revenue, administrative fees, earnings and sales, rent of government property, interests from federal government investments, repayments from state governments, Personal Income Tax of Armed Forces, and others.
The plaintiffs, citing sections 162(1), 162 (10) and 80 of the Nigerian constitution and section 2 of the Finance (Control and Management) Act, 1958, argued that recovered funds qualify as revenue payable to the Federation Account instead of the Consolidated Revenue Account of the federal government.
Therefore, it is “unconstitutional to remit or divert revenue payable into the Federation Account to the Consolidated Revenue Account of the Federal Government or any other account whatsoever, or to apply the said revenue to any other purpose,” the plaintiffs argued.
They are therefore asking for the remittance of N1.8 trillion (cash) and N450billion (non-cash) in recovered loot since 2015 into the federation account.
They are also asking for a detailed account of the recovered assets not remitted into the Federation Account by President Muhammadu Buhari, as well as all the relevant officials and agencies of government.
They also want the apex court to compel the federal government through the Revenue Mobilisation and Fiscal Commission (RMFAC) to design the modalities for distributing recovered assets among the federating units.
The state governments, whose legal team is led by widely known Senior Advocate of Nigeria, Femi Falana, filed the suit with far-reaching implications on the handling of forfeited assets in Nigeria at the Supreme Court on June 16, 2021.
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