Arik Air Repaid 38% Of Foreign Loans Before AMCON Takeover – EFCC Witness

The Economic and Financial Crimes Commission (EFCC) on Tuesday told a Special Offences Court sitting in Ikeja, Lagos, that Arik Air had repaid 38 per cent of its foreign loan obligations before its takeover by the Asset Management Corporation of Nigeria (AMCON).

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A prosecution witness, Bawa Usman Kaltungo, who is the Zonal Director of EFCC Lagos Zonal Directorate 2, disclosed this while testifying before Justice Mojisola Dada.

Kaltungo gave the testimony during the ongoing trial of a former Managing Director of AMCON, Ahmed Kuru, and four others over an alleged N76bn and $31.5m fraud.

Others standing trial alongside Kuru include Kamilu Alaba Omokide, Capt. Roy Ilegbodu, Union Bank of Nigeria, and Super Bravo Limited.

They are facing a six-count charge bordering on conspiracy, stealing, and abuse of office.

The witness told the court that EFCC investigations revealed that Union Bank, which acted as guarantor of the loan, converted a N51 billion guarantee linked to Arik Air but failed to remit the funds to foreign creditors.

“Arik has paid 38 per cent of its loan to foreign creditors, but when Union Bank converted the Arik guarantee of N51 billion, they did not pay the foreign creditors from the funds,” he said.

He added, “Union Bank sat on the N51 billion,” stressing that the funds ought to have been used to settle outstanding obligations.

Kaltungo further explained that the loan facility in question was not directly granted by Union Bank but sourced from foreign institutions, including HSBC.

According to him, Arik Air serviced the loan until June 2010, indicating that the facility was performing at the time.

He also told the court that a letter recovered during the investigation and addressed to former Arik Air Chairman, Johnson Arumemi-Ikhide, confirmed the loan’s performing status.

Under cross-examination, the witness admitted that investigators did not trace any funds to the accounts of the first and second defendants.

He also confirmed that the EFCC did not engage a forensic accountant to determine the full extent of Arik Air’s indebtedness.

Despite this, Kaltungo insisted that his role as lead investigator was sufficient.

“There was no need for a forensic audit or an accounting background, as my position as investigator was sufficient,” he said.

In one of the counts, the prosecution alleged that Union Bank made false statements to AMCON around 2011 regarding Arik Air’s loan performance, leading to the transfer of about N71bn to the corporation.

Another charge alleged that Kuru and others fraudulently converted N4.9bn belonging to Arik Air for the use of NG Eagle Limited in 2022.

Following the proceedings, Justice Mojisola Dada adjourned the case until May 18 for continuation of cross-examination.