Reps Probe NNPC’s $100m Insurance Policy On Non-existing Assets
An investigative hearing into the $100 million premium allegedly paid by Nigerian National Petroleum Corporation (NNPC) and Joint Ventures (JVs) for non-existing assets overseas as well as the implementation of insurance policies of other Ministries, Departments and Agencies (MDAs) began yesterday.
Rep. Darlington Nwokocha, Chairman, House Committee on Insurance & Actuarial Matters, flagged off and presided over the 10-day investigative hearing/pre-forensic Audit meeting.
He explained that the exercise was necessitated by alleged breaches on insurance by insurance business by practitioners; low retention capacity of dollar-denominated insurance business and the effect on the economy; and under-utilisation of capacity of insurance policy, the practice and effects of domiciling insurance ventures abroad.
According to him, others are issues and prospects of ineffective regulation of foreign placements of insurances; alleged loss of billions of naira by the nation through insurances of moribund assets, non-existent assets and high premium rates; alleged huge unsettled life insurance claims, poor handling of Group Life insurance schemes, its effects on the motivation and productivity of working class citizens and non-payment/un-allowed deductions on entitlements of the surviving families.
Nwokocha explained that after the pre-forensic meeting, the Committee would deploy Forensic Auditors to NNPC and all the MDAs as well as insurance companies and brokers handling the portfolios.
The chairman, who underscored the importance and contribution of insurance to the economies in other climes, however, observed that the story is different in Nigeria.
He said: “I want to assert one thing before my colleague moves the motion. Let me talk to all of us, particularly those of us sitting today. We have a 10-day investigative hearing that will be taking place every day, it is not a joke.‘’
“The petitions we have already revolve around over 100 and something million dollars across board within the NNPC and its environs, on insurance related matters. And it’s not something we can sweep under the carpet, it’s not possible.
“Before my colleague will move the motion to define finally the way to go today, there are one or two things I want to mention before today’s meeting with NNPC and insurance companies and brokers. We sent in 211 documents requesting for one document or the other and we have reasons why we have requested for each of those documents.
“For instance, we requested for comprehensive and complete schedule of all insured assets of NNPC and JVs on class basis 2014 only till date. The reason is to compare insurance certificate risk with premium paid and find out where premium was paid for non-existent assets.
“And we cannot do magic to get these information because already we have enough information from everywhere but we must compare what we have with you are bringing; what the insurance companies will bring, what the NNPC will bring, and what the larger society has brought, so that we give everybody fair hearing.
“And this is not something we are talking and some people are taking it so lightly that they are doing some other businesses here and there. We cannot tolerate that. When we invite you for any reason you are not here, we will compel you to come; we have the mechanism, we have the instrumentality to drive the process to make sure that you will come.
“That is why when the President of this country comes to present his budget, he comes, present it and he bows and he leaves. Because the two principal things that function in every economy is income and expenditure. So when you come for an income which we always encourage you to make sure that the income you get it quite enough, its not when you have spent it and we want to find out how you spent the money, you now begin to give us one reason or the other.
“It won’t work, we must summon you to come, definitely and we don’t want to get to that level,” Nwokocha said.
Earlier, Mr. Umar Ajia, Chief Financial Officer of Nigerian National Petroleum Corporation, explained that the NNPC Group Managing Director, Mr. Mele Kyari could not attend the investigative hearing because he needs to hold meeting with associations of oil workers, namely Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSN) and Nigeria Union of Petroleum and Natural Gas Workers (NUPENG).
His words: “I am the chief financial officer, the GMD would have been here but I may him this morning to accompany him here, but he had to stay behind in order or resolve the ongoing PENGASSAN/NUPENG issue if not all of us will find ourselves in big mess in the country. So he asked me to come here while the letter is on its way delegating me to represent him.”
Rep. Nwokocha in his ruling issued a 10-day ultimatum to the NNPC Group Managing Director to appear with relevant documents and take into cognizance all the inadequacies in the previous documents submitted to the Committee.
He said all the stakeholders are to re-appear before the the Committee on the 31st August, 2020