Recently the Nigerian Deposit Insurance Corporation (NDIC) embarked on capacity
building of its in-house lawyers to facilitate quick debt recovery.
In this interview with Financial Journalists, the Managing Director/Chief Executive of the Corporation, Alhaji Ganiyu Ogunleye bares his mind on the benefits of
the training and other various measures to sanitize the banking sector. EXCERPTS…
Why is your corporation training its in-house lawyers?
You would recall that the NDIC enabling Act of 1988 which established the
Corporation was repealed and the NDIC Act 2006 was re-enacted to enable the Corporation carry out its mandate more effectively. One of the major changes
introduced by the Act was the provision in Section 47 which enabled legal practitioners in the employment of the corporation to appear in court to represent the corporation in civil matters as well as prosecute criminal charges involving banking or financial malpractices. It is line with this that we are training our in-house lawyers.
This is not unique as in-house lawyers employed in some other organizations such as Corporate Affairs Commission, the Custom Services and NIPOST, have been in going to courts on behalf of their employers.
Could you list the attendant benefits of this workshop?
First and foremost, the in-house lawyers would be well equipped on the rules of criminal and civil procedure of the superior courts and techniques of advocacy.
The advocacy skills enable them to represent the Corporation well in court, thereby facilitating quick debt recovery.
In concrete terms, could you state how many cases your corporation is handling presently?
As a liquidator, we currently have over 1000 debt recovery cases pending before various courts, valued at N13.6 billion and $37 million in addition to 418 defensive cases involving N3.4 billion, $9 million and £21.6 million.
Is NDIC doing away with external legal practitioners?
No. we will not do away with external legal practitioners. Our in-house lawyers would work along side external solicitors.
Hiring external solicitors does not guarantee substantial recovery given the hardcore and diliquent nature of most of the debts.
Consequently, such debts
are not attractive to external legal practitioners as their fees are tied to quantum of debts could be assigned to in-house solicitors for recovery.
How far has your corporation gone in paying depositors of failed banks?
In some banks we have been able to pay the insured depositors and it is not so in some other failed banks. These are banks that failed before the consolidation.
We are resolving this through the pay out system.
We are collaborating with other relevant agencies like the EFCC, Special Fraud
Units in our investigations. One thing I can assure you is that none of them that have engage in misdemeanour will go free.
We are out to sanitise the banking sector.
We will ensure they are brought to book. It is not necessary to disclose their names since they are still being investigated. We want to ensure accountability and professionalism in the sector.
The corporation in collaboration with the office of the Honourable Attorney-General of the Federation and Minister of Justice have been involved in the prosecution of persons charged with financial malpractices under the failed banks Act.
How many of your staff are attending this training?
We are training about 30 lawyers and you can see the calibers of the trainers.
We went for SANS to underscore the importance we attach to this capacity building exercise.
They would be involved in syndicated advocacy and as a matter of fact, it is not all of them that will be involved in going to courts. It all depends on individual’s flair and skills. Others would do the normal legal duties.
We want to ensure that depositors who put their money in banks could go to bed and sleep with both eyes closed.
The inhouse lawyers would be expected to file debt recovery actions to recover those debts that remain unattractivbe to external solicitors to recover, enforce those judgements that appear unviable to external soilicitors as well as prosecute bankinhg malfeasance.
What effort is NDIC making to recover all the debts in the failed banks?
The primary mandate of the Corporation is the protection of depositors.
The corporation core functions aimed at achieving that objective Banking supervision and bank resolution place enormous responsibilities on the corporation in dealing with parties that contribute to the failure of banks.
The International Association of Deposit Insurers (IADI) 21 Core Principles of Effective Deposit Insurance Systems. Specifically, Principle 15 focuses on dealing with parties at fault in a bank failure.
It emphasizes that a deposit insurer or other relevant safety net participants should be provided with the power to investigate and if need be litigate against those parties at fault in a bank failure. Such power can facilitate debt recoveries as well as mitigate moral hazard by ensuring that those found culpable are brought to book.
What efforts are being made to make past CEOs of failed banks to accounts for
their actions while in office?
There are currently 18 criminal prosecutions being monitored by the Corporation.
The Corporation has engaged the services of numerous legal practitioners to recover debts owed to failed banks through the judicial process.
The Corporation as liquidators had over 1000 debt recovery cases pending in various courts with a total value of N13.6 billion and $37 million. Similarly, there are 756 judgement debts from recovery suits filed by the Corporation as liquidators of the failed banks involving the sum of N6.8 billion and 45 million out of which just 24 valued at N154 million and $4.2 million had been enforced.
Furthermore, there are 418 defensive suits involving the sum of N3.4 billion, $9 million and GBP 21.6 million.
Management approved an attachmnent program to designated lawyers with selected extrernal solicitors which had cpommenced in March this year.
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