First Guarantee Pension Limited (FGPL) founder, Chidi Duru, narrates his ordeal to Assistant Business Editor, KELECHI MGBOJI.
Reason for licence
The licence for First Guarantee Pension Limited (FGPL) was in recognition of the work I did in bringing to fruition the Pension Reform Act of 2014 which could be said to be my bill in the National Assembly (NASS).
FGPL has first generation of shareholders, second, and third. Eventually I brought 37 shareholders together to promote FGPL as a business.
Shareholders
We started the process of incorporating FGPL in 2004. Our original document show myself as the promoter, plus Nnamdi Anama, Mrs. Okpara (wife of Austin Okpara, former House of Representative deputy speaker), Abba Aji (then Senate Committee on Establishment and Industry Committee chairman), and finally Echegba Ndu.
These were the five initial names that were part of the start of FGPL. Aji did not invest in the business.
The second generation of shareholders took the list to 31, and the third raised it to 37.
Origin of the problem
The problem began in 2010 when FGPL became a profitable business. Before then, the firm was struggling because it did not have the required assets under management.
Assets under management make you receive the returns or commission for managing those assets. It was a long process of having a large pool of assets under management that made us become profitable.
We invited a group from South Africa, Novera, to invest in FGPL, and it invested a total N224 million staggered over a period of time. But what was more important was the technical skill they brought to FGPL.
In 2010, the business became profitable and paid its first dividend.
On February 23, 2010, the National Pension Commission (PenCom) presented to the board its annual review of each PFA, in which FGPL was categorised as the most improved PFA in 2010. Every director was very happy with that.
I was surprised that on March 22, 2011, PenCom wrote us a letter that it would like to undertake a ‘Target Examination’. That was barely one month after presenting to us its report for 2010 which categorised our firm as ‘The Most Improved PFA’.
The then Managing Director, Wilson Ideva, was relieved of his office for acts of insubordination and for acts that members of the board did not find as befitting his office.
Then PenCom started the Target Examination and when it wrote its report that was sent to the board in June 2011, the board members queried it.
The board drew its attention to what is required of PenCom under the Pension Reform Act, which is: “If a report is done by a regulator, the report will be submitted to the directors.
“Thereafter, the directors are bound by law to submit that report to the shareholders; and shareholders will vote on that report. And whatever is that outcome of that vote becomes the decision of the company.”
But PenCom didn’t allow us to go through that process. It insisted on that Target Report which it wanted to ram down on shareholders.
What PenCom said in the Target Report
PenCom queried the way FGPL was being run.
It also reported that one of the committees, the executive committee, which the board used to oversight the management of the company, was one committee too many: that it was getting more involved in the oversight of the company, which was not true.
The oversight function which the board detailed in the executive committee of the board was to help the management become profitable, well run and organised.
The result manifested in 2010 when the company became profitable, declared dividend, and was categorised as ‘The Most Improved PFA’.
The report also alleged that the meetings of the board were becoming too many; that the chairman of the board couldn’t have been chairman because he had insignificant shares in the company.
The chairman, who had over N20 million worth of shares in the company, could not be said to have insignificant shareholding.
We thought that our article and Memorandum of Understanding (MoU) did not provide qualification to be on the board not to talk of being the chairman of the board.
We did not agree with the report and proceeded to court in August 2011. Effective August 11, 2011, Justice Okorowo of the Federal High Court, Abuja issued an exparte order restraining PenCom from implementing the ‘Target Report’ pending the hearing and determination of the substantive suit.
But on August 15 PenCom dissolved the board and appointed an interim management into FGPL, which is still running it till today.
We felt outraged, our partners from South Africa felt outraged, shareholders were shocked and petitioned the Attorney General of the Federation (AGF) and Minister of Justice, Mohammed Bello Adoke, on this disrespect for court order.
Adoke, in his two letters of August 18 and September 8, 2011 to PenCom asked it to obey the court order, revert to the status quo, allow the board to function and, more importantly, dismantle the interim management.
Like the court order, the letters and directive of Adoke were also discountenanced. No step was taken to reverse those decisions of PenCom.
However, on June 18, 2012, the court delivered full judgment having heard all the parties.
It upbraided PenCom for being above the law, disrespectful to the law, for not obeying court order; and ordered that the interim management appointed in FGP be removed.
The court requested the commissioner of police in Lagos, where we have our head office, and the police commissioner in Abuja to enable the board members take back their business.
That has not been implemented and the original directors are still kept outside the company. The shareholders are still kept out of the company. And the company has not had an annual or emergency general meeting in the past six years.
PenCom is still managing the business.
Detention of your sister by the EFCC
On Monday, October 3, 2011, which was a holiday because October 1 was a Saturday, operatives of the EFCC invaded my house and requested my presence in their office on a holiday.
I had never before then received any call nor received any invitation by letter on any matter before. I was taken to their office and presented with a petition that Kashim Ibrahim Imam wrote to the EFCC to implement the Target Report by PenCom.
It was a surprise to me because the court had issued an order saying that the Target Report should not be implemented pending the determination of a substantive suit.
Kashim and five of the 37 shareholders had also gone to a Federal High Court in Abuja seeking an order of mandamus to compel the EFCC to investigate the Target Report issued by PenCom.
The court suspended that application as an abuse of court process since there was already a judgment of the court.
I was kept overnight with the EFCC and on October 4, my sister, Chinyere Christy Ekweonu, requested two directors to take me on bail, which they did.
We thought that was the end of the matter because the panel set up to look into the matter from the EFCC concluded that this is actually a business transaction that had gone wrong among partners and has no business being before the EFCC.
However, in 2012 – immediately the court gave the full judgment nullifying the Target Report by PenCom and mandating it to hand back the business to its directors and original shareholders – we applied to the police commissioners in Lagos and Abuja to help us take back our business.
A lot of activities then began to happen. One of the shareholders, Kashim, a friend of the then minister of police affairs, reached out to him and through him got to the Inspector General of Police, M. D. Abubakar, who invited us to make a report on why we were disturbing the peace in FGPL.
A complainant now became an accused. We showed the judgment of the court but that did not hold water. Before we realised what was happening, the EFCC and the police were both investigating the matter.
Then we wrote to Adoke and brought this matter again to his attention in January 2013, but the pressure was now mounting because the police and the EFCC were both inviting us.
Adoke then wrote to the police to stop as two agencies of the government couldn’t be doing the same thing and that they should bring the file to him. He two letters were written on January 17 and 23 2013 asking them to bring the file.
However, the police continued and preferred a charge against me before a Magistrate’s Court in Abuja for alleged theft and forgery.
We went before the Magistrate’s Court on March 28, 2013, exhibited all the judgments of the High Court, including the order saying the police must stay action pending the determination of the case.
The magistrate ruled on March 28 2013 that this was an abuse of court process and in conflict with judgments of the High Court.
However, I got a call from the EFCC requiring my presence on Easter Tuesday, April 3, 2013. Unknown to me, it was an agreement between the police and the EFCC to and hand me over to the police.
I was in their office from 9am to about 3pm when officers from the office of the IGP came to pick me. At 5pm, I was moved to Maitama police station to be kept overnight.
However, because Easter Thursday was a public holiday, the judge had not endorsed the order he gave crushing the charge before his court. He only signed that order on Easter Tuesday.
When my lawyers got that order, they quickly rushed to the office of the IGP and handed it to him. That was how the police sent their car to Maitama to return me to the IGP and then back to the EFCC. From EFCC, I was released to go home.
In January 2013, we became aware through a mutual friend that another charge had been preferred against me in a court here in Lagos.
We immediately went to court, got all the court documents, then realised that it was the EFCC that had come to Lagos as of October 5, 2015 to prefer a charge on the same Target Report before the High Court.
We made appearance at the court. The next date for hearing was February 16, 2016. But the EFCC was not in court and the judge adjourned the matter for hearing of their preliminary objection on April 11.
It became very clear that somebody somewhere, whom we understand is Kashim, is stoking the fire again using government agency to undermine and persecute an innocent citizen.
We then petitioned the current AGF, Abubakar Malami, on March 8, 2016 to bring to his attention this matter once more.
On April 6, when our petitions were considered, Malami caused a letter to be written to the EFCC demanding that the case file be returned to his office for review. Nothing happened. He wrote a second letter and again nothing happened.
On April 27, I asked my lawyers to write the EFCC that, in view of the recent two letters of Malami, would it still be writing me to appear before it for a matter that has already being tried in court?
On April 11, my lawyers and the lawyers of the EFCC agreed on the preliminary objection. So the ruling was fixed for May 11, 2016.
On May 10, I flew from Abuja to Lagos to be in court the next day. But the court did not sit because the judge was indisposed. The matter was then adjourned to June 8, 2016.
As we were leaving court, I received a call from my sister that the operatives of the EFCC were at her office looking for me and they had arrested her.
She informed them that I was in the court in Lagos where they charged me to. They took her to their office and detained her.
What does Kashim Ibrahim want?
A filing that did not have the directors’ approval nor the shareholders’ resolution was filed with the Corporate Affairs Commission (CAC) on December 11, 2011 which restructured the shareholding structure of FGPL.
The shareholding of our foreign partners was removed as investors in FGPL and treated now as deposit for shares.
My shares were reduced by 50 per cent from 248 million to 122 million. There was no shareholders’ resolution; no shareholders’ meeting; nor was there directors’ meeting where this was approved.
The people that filed this were members of the interim management appointed by PenCom against court order.
On June 13, 2012 another illegal thing happened. Kashim was said to have been elected as chairman of FGPL.
There was an order of the court restraining the convening of the meeting of June 13, 2012. The venue of the meeting advertised in their advertorial was Niger Hall, Transcorp Hilton in Abuja.
But when they filed the purported resolution appointing Kashim as chairman and four others as board members of FGPL, they stated that the meeting held on June 13, 2012 at Valencia Hotel.
The Companies and Allied Matters Act (CAMA) says if you move the venue of your meeting to another venue, that meeting will stand adjoined till the following week and the new agenda and notice will be published for the shareholders.
So, you could not have a meeting that was purported to hold at Niger Hall in Transcorp Hilton in June 13, 2012 and that meeting now held in Valencia Hotel on June 13, 2012.
There was also a court order stopping and restraining that meeting advertised to hold in Transcorp Hilton. Again, this was an infraction of the law and order of the court.
So the matter was now filed and Kashim was now introduced in the CAC as the chairman of FGPL, which we are now challenging in the court.
What other shareholders are saying
The Kashim group was initially comprised nine members. But six broke away and did requisition for an emergency general meeting (EGM) of FGPL in March 2016. In that meeting, they removed Kashim and one other as directors.
And they have on their own, all the shareholders, in a general meeting, taken a stand that
• This business belongs to them and PenCom should it hand over the.
• PenCom cannot claim to be properly running a business and has not conducted an annual general meeting (AGM) in the past six years to account to the shareholders of how the business is being run.
• Pencom cannot be properly running the business without an annual account and financial audit of the company approved and signed by the directors and approved by shareholders in an AGM filed to the CAC.
• Pencom cannot be properly running the business where dividends have not been paid to shareholders in the past six years.
The shareholders have been keeping track that they have over N4.8 billion in the bank and the money is growing by the day.
Corporate governance in FGPL managed by the interim management appointed by PenCom is at its lowest ebb. The company has not paid any tax to any government, Lagos or federal. Why?
Because it is under a management that is not known to law; with a history of abuse of court order and abuse of court process. The shareholders are not in control of their business.
And this is what the shareholders are crying for, give them back their business and let them run like any other PFA in the market and then regulate the business. You cannot be a regulator and a manager at the same time.
Allegation that you did not buy the shares’ worth of money deposited with you by shareholders
At FGPL, there were three names that led to the final name that we chose.
Initially, the name was First Provident Trust Limited. That name was rejected by PenCom.
Then I changed the name to First Pension which again was rejected by PenCom. Finally, we changed the name to FGPL which was now approved by PenCom as the name that we have as a company.
Each investor and shareholder issued his cheque or instrument to one of these three names.
None of the investors or shareholders invested in the name of any platform other than the three names which finally evolved to FGPL.
It was these instruments that were used as a proof of evidence to PenCom of the investments that was done by each and every shareholder.
It could not have happened that any shareholder or investor in FGPL could have given money to me or to any other person for his investment in FGPL in any other name.
The guideline by PenCom was that every investment must be made in the name of the proposed PFA on the basis of which it now issued Approval In Principle (AIP) to become a PFA.
After AIP, we were given a final licence when we now presented the final instrument that each and every shareholder invested in FGPL.
When other PFAs were raising N150 million, FGPL raised N235 million in the first tranche and later raised another N500 million to a total of over N880 million.
And all those investments were done in one of those three names which were accounted for and registered in PenCom as proof of evidence.
Fate of foreign investor
The South African partner went to court and successfully challenged their removal from the board.
They petitioned their embassy here in Nigeria; they petitioned the Ministry of Justice; and like every other shareholder, they are waiting for the resolution of the case by PenCom.
Allegation that you forged the signature of Ibrahim Imam in the shareholders’ agreement to admit the investment of Novera
One of the charges they brought before the Magistrate’s Court in Abuja was the forgery of the signature of Ibrahim Imam in the shareholders agreement to admit the investment of our partners from South Africa into FGPL.
That was surprising because, first, I am not the management; second, I have no role to play in it.
However, on November 13, 2008 when the then managing director presented to the board that the shareholders agreement permitting the investment of Novare into FGPL had been signed by the shareholders (there are two ways to obtain the agreement of shareholders – either by all the shareholders signing by what we call round ribbon or at a general meeting of the shareholders) but this process was done through round ribbon.
The chairman at that meeting said since we had an AGM coming up on January 19, 2009, he would prefer that the question of investment of Novare be tabled and discussed at the AGM.
He said he agreed with the managing director and company secretary that Novare had met every condition for a resolution of the shareholders to admit Novare into FGPL but that we had nothing to lose if we waited for the next two months to take the matter to a general meeting of the shareholders.
And that was carried as a resolution of the board.
At the shareholders’ meeting on January 19, 2009, the chairman said he had been advised that with the shareholders agreement as signed, we had met the requirement to admit Novare.
But he said he would like to keep the document aside as he wanted the shareholders to understand what they had signed which would dilute their shareholding because when Novare invested in FGPL, if you own 18 per cent for instance, it will come down to 15 per cent.
“At the end of the day, unanimously, without any dissenting vote, Novare was admitted to invest in FGPL.
It was the resolution of that meeting that was filed with the CAC admitting the investment of Novare into FGPL.
If anybody knew that his signature was forged or he didn’t agree with it, he could have raised it at the AGM.
So, this is part of the charge against me which the Abuja High Court quashed.
Where do you go from here?
We have appealed to the AGF who has requested the file to be sent to his office; we are hopeful that this will be done.
We are hopeful that they will now open the veil surrounding all the activities in FGPL and look at them with an unbiased mind and bring parties to question.
• If it is found that there has been any infraction on our part, let justice be done.
• If it is found that we have not done anything wrong and that some other people have misused their power and influence, let justice be done.
• There must be an order that FGPL must immediately convene a meeting of the shareholders.
• It must not continue that FGPL has not had any shareholders’ meeting in the past five years
• It must not happen that FGP has not filed annual return and accounts to the CAC for five years and the CAC is keeping quiet.
• It must not happen that for five years, FGPL has neither paid dividend to the shareholders nor tax to the government and the regulatory authorities, particularly now that the government is broke.