The Court of Appeal validates the order to freeze the EFCC in the accounts of state governments

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The Court of Appeal, Makurdi Division, has validated the power of the Economic and Financial Crimes Commission (EFCC) order banks, without the backing of a court order, to freeze state government accounts for investigative purposes.

The court’s decision handed down on Thursday overturned the earlier ruling by the Federal High Court in Makurdi that had prohibited the anti-corruption agency from placing a Post-No-Debit (PND) order on Benue state government accounts.

“In a unanimous ruling by Judge MS Hassan on Thursday, September 22, 2022, the appeals court held that the EFCC has the power to place any account (including state government accounts) in the PND for 72 hours, with the purpose of conducting research. without court order.

“The court also set aside damages of N50 million awarded against the EFCC by the lower court,” the statement read in part.

The Central Bank of Nigeria (CBN) and anti-corruption agencies often issue a PND through letters to banks to prevent certain customers from debiting their bank accounts that are under investigation.

The PND order lasts for 72 hours and the requesting agency is expected to obtain a court order for the account restrictions to continue.

Background

The Benue state government had said in August 2018 that its bank accounts with funds intended to pay the wages of workers and pensioners had been frozen at the request of the EFCC.

“The accounts of the Benue state government have been frozen by the EFCC,” Terver Akase, a spokesman for Governor Samuel Ortom, said in a statement.

“It is part of the political witch hunt against Governor Samuel Ortom. EFCC’s action is already having a negative impact on the functioning of the government in Benue State. It is a measure that will affect salaries, pensions and various other payments,” Akase said.

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His confirmation came a day after it was reported that at least three bank accounts the state held with GTBank, First Bank and Fidelity Bank had been blocked by the anti-corruption office as part of a corruption investigation.

Media reports had suggested that Benue state governor Samuel Ortom was under investigation for embezzlement of security funds.

The governor denied the allegations, saying the investigation was part of a witch hunt triggered by his recent defection from the ruling All Progressives Congress (APC) to the opposition Peoples’ Democratic Party (PDP).

The state government then approached the Makurdi Federal High Court to place a PND on their accounts without a warrant.

In the ruling issued on February 2, 2019, Judge Mobolaji Olajuwon prohibited the EFCC from placing a PND on behalf of the Benue state government.

Dissatisfied with the ruling, the EFCC appealed against her at the Makurdi Court of Appeal, with her lawyer, Steve Odiase, arguing that it is within their power to freeze the Benue State Government account.

The court, in its ruling, according to the EFCC, held that banks are legally bound to obey the orders of the EFCC’s PND.

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