TSA: Accountant General Speaks On ‘Government’s Money Withheld By Commercial Banks’

The Office of the Account General has said it is not aware of the location of the N1.2 trillion belonging to the federal government which banks have refused to release despite several directives mandating them to do so.

At the investigative hearing into unclaimed funds organised by an ad hoc Committee of the House of Representatives on Monday, Sylva Okorieaboh, a director at the OAGF, disclosed that the agency, which is statutorily charged with keeping record of the government’s financial records, is unaware of the details of the funds withheld by banks.

Mr Okorieaboh, who represented the OAGF at the hearing, however, said the government is aware that banks are violating the Treasury Single Account (TSA) policy of the government. But he said the agency does not know the specifics of the funds or their locations.

The official, who is the coordinator of the TSA, said the Minister of Finance and National Planning, Zainab Ahmed, had set up a committee to review the implementation of the policy of the federal government.

According to him, the minister had directed banks to remit the funds to the TSA or risk being dragged to anti-graft agencies ”but the banks are not yielding.”

“We are aware that there is good likelihood that substantial amount of federal government funds might still be lying with commercial banks despite the presidential directive of 7th August 2015, and the circulars and efforts made to compel the commercial banks to comply with those directives.”

On the December 14, 2021, the Minister of Finance inaugurated a new TSA implementation structure and she alluded to the fact that there is a likelihood that substantial amounts of federal government funds are still lying with commercial banks. She directed the banks to return those funds or they will be reported to anti-corruption agencies.

“We believe that there are still federal government funds with commercial banks but we can’t say specifically how much and where. So to that extent we welcome the efforts of this committee.

”The TSA guideline we issued in 2015, on page 14 states that all collections must be swept to their individual federation account at CBN on daily basis. The use of intermediary accounts is not allowed. So, right from day one, this is what we have always tried to enforce. So if any bank or MDAs is not doing this, that is clearly an infraction and the work of this committee will help us unravel anything of that such.”

The TSA, which is a unified accounting system for all federal government cashflow, prohibit MDAs from operating account outside the TSA system.

The decision to set up the committee followed the adoption of a motion by Dachung Bagos (PDP, Plateau) on the need to investigate unclaimed funds in commercial banks.

The House had mandated the committee to investigate suspicious unclaimed funds trapped in commercial banks, including advance payments by the government for contracts.

The committee was also mandated to investigate the unremitted funds collected on behalf of agencies and departments of the federal government by commercial banks.

Its Chairman, Uyime Idem (PDP, Akwa-Ibom), explained that the probe will focus on the specific roles of the Central Bank of Nigeria, the Commercial Banks and the Ministries, Departments and Agencies (MDAs) of the federal overnment of on the issue of unclaimed funds.

Also, the committee will look at the level of compliance with the TSA policy by the MDAs since its commencement in December 2015 and the review of long outstanding Advance Payment Guarantees (APGs) issued on federal government’ projects, and monies held because of failed and unexecuted contracts.

Furthermore, the committee will look at the evaluation of the level of compliance with the operation of the Bank Verification Number (BVN) regime by the Nigerian Commercial Banks under the supervision of the Central Bank of Nigeria (CBN) and other stakeholders such as the Nigerian Inter-Bank Settlement System (NIBSS).

Speaking at the hearing, the Director-General of Budget Office, Ben Akabueze, who represented the Minister of Finance, Zainab Ahmed, said ”the ministry did not understand the letter sent to them”.

According to Mr Akabueze, they thought the probe was into unclaimed funds in dormant and inactive accounts.

“When we received this invitation that talked about unclaimed funds in Nigeria commercial banks, basically my initial reading of this is that it’s related to inactive accounts, dormant accounts, because the extant regulation guiding the management of these issued by the CBN, on October 2015, provides guidelines for the management of inactive accounts dormant accounts and unclaimed funds. Those guidelines obligate any bank to have notified the federal government of the existence of any such funds belonging to it,” he said.

Meanwhile, declaring the investigative hearing opened, the Speaker, Femi Gbajabiamila, who was represented by the Deputy Speaker, Idris Wase (APC, Plateau), said the said N1.2 trillion will go a long way to improve the fiscal constraint facing the county.

Other MDAs that appeared before the committees are Federal Aviation Authority of Nigeria (FAAN), Nigerian Maritime Administration and Safety Agency (NIMASA) and some representatives of banks.

The Chairman of the Committee directed that banks be given specific dates to appear before the Committee.