BusinessLegal/Judiciary

N6.4bn illegal charges: Zenith Bank knows fate December 13

•As court delivers judgment

By Francis IWUCHUKWU

December 13, 2021, has been fixed as the day to deliver judgment on the legal war instituted by a Nigerian independent oil marketer, Olushola Anthony Adejuyigbe against Zenilth Bank Plc.

The date was fixed by Justice Ayokunle Faji of a Federal High Court sitting in Ikoyi, Lagos State, Nigeria, on October 29, 2021, after parties adopted their final written addresses.

It would be recalled that Adejuyigbe alongside his company, Tonique Oil Services Limited, had in 2018 instituted a suit designated FHC/L/CS/1584/2012, against Zenith Bank Plc, over alleged illegal and excessive charges to the tune of N6, 441, 369, 617.73 billion.

In his amended statement of claim, Adejuyigbe through his counsel, Lanre Ogunlesi (SAN) revealed that in the course of its business activities, his company, Tonique Oil Services Limited obtained several credit facilities from Zenith Bank PLC while he pledged three of his properties as securities for the loan facilities.

The oil merchant further stated that three different transactions leading to the legal battle occurred in his company’s Current Account where the alleged excess and illegal interest and charges were discovered and that upon discovery of the said charges, the company demanded a reversal but Zenilth Bank bluntly refused.

He also stated that a forensic accounting firm was engaged to scrutinize and analyse his company’s account, and it was then discovered that between August 2006 and December 2013, excess interest and charges on the company by Zenith Bank Plc had accumulated to the tune of N1, 842, 471, 801. 99 billion.

Adejuyigbe equally maintained that by a letter dated February 19, 2008, Zenith Bank granted his Company commercial paper facility of N2, 568, 644, 276. 09 billion to finance the purchase of 30,000MT of petroleum products, but N2,501,270, 000 billion, was credited into the company’s account.

According to Adejuyigbe, rather than for Zenith Bank to finance the purchase of 30, 000 MT of petroleum products for the company as per the letter of offer, the bank diverted the entire sum of N2, 501, 270 billion for the purchase of its shares during the bank’s Initial Public Offer, IPO, conduct he described as unethical, unprofessional and reprehensible.

The oil marketer also added that out of the sum of N104, 363, 212. 03 million assessed as dividends payable on the bank’s shares, only N42,173,498.43 million was credited into the company’s account, leaving an outstanding balance of N62, 169, 713. 60.

He suggested that the bank’s shares purportedly bought by his company with the facilities granted by Zenith Bank were managed by the bank so much that the bank eventually liquidated the shares after the value has nosedived and depreciated.

Adejuyigbe posited that another activity on his company’s current account with Zenilth Bank was the sale and purchase of a property in Port Harcourt, Rivers State, that belongs to one of the shareholders/customers of the bank who needed to clean up some of his obligations to the bank, stating that it was the bank who introduced his company to the shareholders’ 50,000 square meters of land out of which the company bought 20,000 square meters to expand its business earnings.

He averred that to facilitate the purchase of the land, Zenith Bank offered the company a term loan of N500,000 and that it was part of the understanding of the company and the bank that after the purchase of the land, the bank will finance the company’s Tank Farms to be built thereon.

Adejuyigbe further stated that after the purchase of the land, Zenilth Bank took possession of the title documents of the land as collateral while reneging on the promise and understanding to finance his company’s Tank Farm on the land and since 2008 the land had been under the management of the bank and the same had been lying fallow.

Consequently, the plaintiff contended that Tonique Oil Company is not indebted to Zenith Bank and any alleged indebtedness could only have arisen as a result of the unconscionable and illegal acts of the bank’s officials in debiting the company’s account with astronomical and spurious interest charged.

He contended that such interest charges are illegal, and they contravened the Central Bank of Nigeria, CBN, Monetary Credit and Foreign Exchange/Trade guidelines.

The plaintiff’s financial consultant computed other charges that were passed into the account of the company, based on relevant policy circulars, a guide to bank charges of Central bank of Nigeria and discovered that the bank excessively overcharged the company on interest on an overdraft, COT, and VAT on COT, management fees, upcountry transfer fees, interest on commercial paper, foreign exchange purchases and letter of credits.

Adejuyigbe is contending that he is not indebted to the bank, rather the bank has overcharged him to several billions of Naira. He urged the court to declare that Zenith Bank, being a bank within the and control of CBN cannot charge interest on any facilities granted to him beyond the official approved policy rate of the Central Bank of Nigeria.

He equally asked the court not only to restrain Zenith Bank from selling his properties pledged as securities for the loan, but to also compel it to pay his company the sum of ₦6, 441, 369, 617.73 billion, being the total excess charges debited into the company’s account by the bank and interest on the same amount at the rate of 21% per annum from the date of judgment of the court until final liquidation.

But Zenith Bank in its statement of defence, with its statement on oath sworn to by Senior Assistant Manager internal control and Audit Department of Zenith Bank, Vincent Ohanugo and filed by its lawyers, Ajibola Lawal-Akapo and others, denied almost all the plaintiff’s claims and stated that the company was granted several loans which include: ₦2.5 billion regular commercial paper; $36 million import finance facility; $6, 648 million commercial paper/usance facility; $9million import finance facility via usance facility and $11million short term import facility of ₦500 million.

The bank also stated that the plaintiff authorized Zenith Registrars Plc to take steps to purchase the shares of the bank on its behalf, while also pledging 3.5million and 17,154,300 units of the shares respectively, in favour of the bank and authorized the bank to sell them to recoup part of the credit facilities the bank granted.

Zenith Bank also said the allegation of unethical conduct, lack of competence and professionalism against it by the plaintiff was made out of malice, confusion and frustration on the part of the plaintiffs.

The financial institution equally posited that it did not enter any understanding with the plaintiff to finance the construction of Tank Farm for the company, with an additional position that the plaintiff’s assertion that he is no longer indebted to the bank is a mere denial and therefore challenged the plaintiff to provide evidence of payment of all the credit facilities availed to them by the bank.

Zenith Bank also stated that the plaintiff’s suit did not disclose any cause of action against it, as the plaintiff is still indebted to it in the sum of N8, 464, 176, 356.52 billion as at January 31, 2013.

The bank therefore urged the court to dismiss the suit for been frivolous and same amounting to abuse of court process.

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