ASSET recovery, an important law enforcement tool for achieving the broader ends of justice, accountability, and the rule of law, is a controversial topic in Nigeria as revealed in a recent investigative report in The PUNCH. Although the law enforcement agencies have reportedly recovered over $2.2 billion worth of assets, there is no reliable data on the recoveries or how they are disposed of. To fight corruption effectively, the Federal Government should put the recovery and the sale of assets in the public domain.
As of October, the Inter-ministerial Committee on the Disposal of Forfeited Assets had listed 25 different locations across the country hosting these seized assets. The 1,620 properties include vehicles, houses, phones, laptops, vessels, and other valuables. Lagos has the highest number with 31 houses and 589 vehicles. Some of the properties were recovered from a former Minister of Petroleum Resources Diezani Alison-Madueke, and Alex Badeh, a former Chief of Defence Staff. The committee says some valuation firms have made bids to auction them on behalf of the government. This is a right step. However, there are still grounds for concern.
The PUNCH reported that a syndicate in the Federal Ministry of Justice has allegedly been tampering with the recovered assets, perhaps selling them off at below market prices. This should be investigated as it raises the critical question of transparency in the disposal of the assets. An anti-graft campaign, to secure the critical popular buy-in, should be transparent from prosecution to asset recovery and disposal.
Another report says that 90 ships seized by the Economic and Financial Crimes Commission have begun to sink in waters across the country, while many of those temporarily and permanently forfeited by suspected corrupt persons are being damaged due to lack of maintenance. A House of Representatives ad hoc committee on assets recovered from 2002 to 2020, following oversight visits to the locations of such assets, had similarly expressed its displeasure at what it found.
There have been reports of seized assets like vehicles, furniture, electronics, and machinery wasting away due to exposure to the elements, poor storage, and lack of a proper management system.
The Centre for Democracy and Development, an anti-corruption watchdog, puts the value of assets recovered by the EFCC and the Code of Conduct Bureau in the past 20 years at about N900 billion. But it queries the efficiency in the management of those assets. Going forward, Nigeria should learn from the tested practice in other climes.
The government needs to implement a programme for efficiently managing frozen, and confiscated property and, where necessary, disposing of such property. A 2005 Best Practices for the Administration of Seized Assets guide by the Group of Eight States stressed this, declaring; “States must ensure that strong controls for the administration of seized assets are in place. Transparency in the management of seized assets is critical, such as by means of an annual examination of the asset management authority by independent auditors, including the examination and certification of financial records, which are made public.”
Flexibility of tools for the disposal of seized assets is equally imperative. Legislation in the Netherlands, Belgium, Brazil, Romania, the United States, Mexico, and Indonesia allows flexibility in the disposal of seized assets. This accommodates when the assets are not suitable for storage; when they are perishable; when they would lose value quickly; when the asset (and its storage) poses a public risk (e.g. flammable goods); when the management of the asset is overly complex or costly; when the asset has been abandoned; when they constitute an instrumentality for the offence; and after a predetermined time that the asset has been under seizure, or when the sale would be in the objective interest of the suspect.
In Romania, the formation of the asset recovery office within the Ministry of Justice in 2011 facilitated an increase by over 300 per cent in the value of already seized assets, and by more than 400 per cent in the value of confiscated assets in subsequent years. These successes prompted the adoption of a law setting up a specialised asset management office.
Canada and France also established self-standing specialised asset management entities to oversee the increase in confiscation orders. In line with a 2014 directive, many more European Union member countries have similarly established institutions with specialist capacity to manage confiscated assets.
The cost of managing a seized asset can quickly exceed its value. To manage costs effectively, the Netherlands introduced a central registration system that allows for swift action to be taken when the costs exceed the value of the asset. Canada provides for the disposal of rapidly depreciating property. Costa Rica permits the pre-confiscation sale of assets when there is risk of depreciation, deterioration, or rapid destruction. In the US, a sale is conducted either by public auction or through private treaty.
But the institutional arrangements to manage and dispose of these assets must be subjected to intense public scrutiny. Reports that expose poor management or illustrate that confiscated property is being dealt with contrary to a court order can seriously undermine the credibility of the asset recovery programme. There is also the crucial aspect of stamping out any whiff of corruption in disposing of recovered stolen assets
Meticulous record-keeping, the adoption of transparent procedures and compliance with the policies, procedures, court orders and laws that govern the asset management process are critical for its transparency and accountability. The Federal Government should comply with global best practices guiding the management and disposal of recovered and forfeited assets. Specialists should be on board to oversee the process.
Overall, the President, Major General Muhammadu Buhari (retd.), needs to restructure the entire anti-graft campaign to ensure close collaboration among the various law enforcement agencies, and effective coordination to achieve seamless operations from investigation to arrest, prosecution, asset seizure and their transparent disposal.
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