Stolen documents

From: Bob Minton <bob@minton.org>
Subject: Stolen documents
Date: Thu, 16 Sep 1999 17:32:21 -0400
Message-ID: <tmDhNz2LjDv6WPXTZljvuUh5GCju@4ax.com>

Seems that when the Scientologists broke in to Jeff Schmidt's office in London and stole (by copying) all of his files, some of the stolen documents seem to have ended up in the hands the Africa News Service. This is part of Scientology's ongoing campaign to try and destroy Jeff Schmidt to get at me and to implicate me in Scientology- like activity.

For the record, I have had absolutely no involvement in ANY of the transcations mentioned in this article.

Thanks to Grady Ward for tracking it down :-) Bob Minton

The Naira 17 Billion Quagmire
Wahab Gbadamosi In Abuja And Washington
07/19/1999 Africa News Service Copyright © 1999 Africa News Service Lagos, Nigeria - Twenty years and N17 billion gone down the drain, the national identity card project remains uncompleted and is held hostage by international wheeler-dealers. What can Obasanjo do?

One multi-billion naira project which became a major preoccupation of the immediate past military administration- led by General Abdulsalami Abubakar (retd.), six months to its exit, was the N17 billion national identity card scheme, now in its 20th year. Two former ministers, information's Chief John Nwodo and internal affairs' Professor Musa Yakubu and the latter's chief press secretary, Chief Nwachukwu Bellu, at different times, while in office, pronounced on the project's completion date (May 1999) and financial commitment.

In fidelity to such boasts, Gen. Abubakar and a few others were issued the new identity cards two days before they left office. What Abubakar's men left out which The News investigation has revealed is that, out of the N6 billion the general planned to spend on the project in 1999, about N5 billion was disbursed in the last 30 days of the regime. Again, contrary to the trumpeted 'commissioning' in Abuja, the project is still very much in a limbo.

In some parts of the federation, imported computer equipment have not been installed and contractors raised dusts over outstanding payments. This is aside the huge financial drainpipe that some of the obsolete computers, imported over the last 15 years, had become. Screened away from Nigerians too, is the payment of about N110 million which represents slightly above 20 per cent of the offshore component of N500 million spent on the project in the last 12 months.

Beyond this expensive financial profile, unknown to many Nigerians is that, the nation might have become hostage to an international ring of controversial businessmen cutting deals with the project while smiling to the bank.

The contract has a long-winding history. Conceived by the Federal Military Government under Gen. Olusegun Obasanjo, it was to have been executed by the Department of National Civic Registration (DNCR), of the Internal Affairs Ministry at a cost of $10 million. Since then, the scheme has been verbally commissioned, re-evaluated and re-awarded several times over. The circle of awards and rewards began under Second Republic's President Shehu Shagari when a front and a member of his party, the National Party of Nigeria (NPN), picked the contract.

According to a Newswatch magazine story in 1994, the party man brought in Optiflex International which financed the project and the contractors, Avant Incorporated, both from the United States. Non- performance resulted in the revocation of the contract in 1981. It was a ruse though.

Avant, according to Newswatch won back the contract, beating, Agfa Gaevert of Germany, Thomas de la Rue from Britain and another US company, Itek Corporation. Avant got a $46 million revaluation on top of the initial $10 million. By December 1983, when Shagari was ousted, $90 million of the $100 million for which the contract was reevaluated had been paid to Avant.

Even so, this covered pre-shipment costs only. The equipment never left French ports. The military government led by Gen. Muhammadu Buhari (retd.) scrapped the project in 1984. Attempts by Gen. Ibrahim Babangida, who overthrew Buhari, to resuscitate the project was initially dampened by the demurrage incurred on the equipment. It had ballooned to half the project sum. Though successive internal affairs ministers rejected the idea, government still paid $14 million to a French company and N52 million for the construction of 22 computer centres following renegotiations.

Then entered Afro-Continental Limited which is regarded as having a link to Avant Incorporation. Afro-Continental came midway into Gen. Babangida's tenure. Given only nine months to complete the project, the company dragged on for 12 years, earned a dozen contract reviews and revaluations. Its initial insistence that government paid $43 million to Honeybull France for safekeeping of the computer components in France was rebuffed. $3 million was paid for upgrading the hard disc of the computers, though.

By 1986, the structural adjustment programme-induced devaluation rendered the allocation to the project worthless. Then, over 5,000 men had been recruited for the scheme, some of whom were trained in Germany.

In 1992, a fresh agreement with Afro-Continental brought in Nessim David Gaon, a Swiss businessman, who sourced a loan of $74.5 million for the project through his company, Noga, S.A. Afro-Continental introduced the automatic fingerprint identification system, to make the card foolproof and slammed a hefty N1 billion additional cost on the nation. Still, the company failed to deliver in March 1993 thus courting the sharp edge of the minister, Dr. Tunji Olagunju's tongue.

The contractors worked at an incredibly slow pace, complaining the financier was not providing funds. Nigeria also refused to provide offshore component of the contract. Soon, NOGA sold off its promissory notes to Hydroma International Limited S. A. The late head of state, Gen. Sani Abacha, would, however, not deal with Hydroma. A source told The News in Abuja two weeks ago, that government refused to honour its obligation with respect to the NOGA notes because it was unaware of the deal between the two international finance companies.

Hydroma headed for the courts, claiming the Federal government and the finance ministry failed to honour their obligations. After two years of a legal contest that got nowhere, the parties agreed to an out-of-court settlement in 1998.

Then the project, outside $100 million paid out in 1983, had gulped about N2 billion. By April 1999, the chief press secretary to the internal affairs minister said that $8.049 billion had been sunk into the project. Still, about N7 billion was needed to complete it. Such hefty financial requirements prompted queries by the National Concord, a national newspaper, on why a government preparing to go should commit so much to an epileptic project when the nation's infrastructure was decaying.

Government's decision to resuscitate the project in the wake of an out-of-court settlement brokered by Prof. S.A.

Adesanya, a solicitor, sprang Hydroma into action. In a letter dated 6 November from Geneva, sent to the Internal Affairs Minister and his finance counterpart, Hydroma indicated that Afro-Continental and SAGEM will now complete the project. "This current situation," says the letter, "shall cause the payment of promissory notes in accordance with the terms of the loan agreement dated 17 March 1992, to be due and regularly payable.

The government, however, kicked at Hydroma's suggestion that Afro- Continental should participate in the completion of the project. It insisted, a source said, that SAGEM of France -a huge photography concern and manufacturers of the new equipment for the scheme, will take over from Afro-Continental. The government, a source also indicated, demanded that Afro- Continental should sign a notice of discontinuance on the project.

The manner in which the identity card contract changed hands, the swinging of promissory notes, the companies involved and interests behind them, suggest that a web of international businessmen might be feeding off the project.

The News investigations in Washington (United States), Abuja and Lagos revealed, for example, that NOGA, Afro-Continental and Hydroma might be one and the same entity, all organised around David Gaon. It was Gaon's NOGA that raised the 1992 loan of for the project. Between 1993 and 1995, Afro-Continental stalled, citing non-funding by NOGA. The Nigerian government also declined to honour the notes. Soon, NOGA sold off its promissory notes and interests in the project to Hydroma International Limited, cutting off Gaon from the project, in a way.

There are, however, indications Gaon is linked to Hydroma as his concern over the company's financial fortunes shows. On 25 March, this year, the architect of the out-of-court settlement in the wake of 1996 court case, Adesanya, wrote N.D. Gaon a two- paragraph letter. The letter shows that albeit, Gaon might have sold off the promissory notes to Hydroma some years before, he was still involved, or at the very least interested in proceeds from the identity card project.

"I attach herewith a copy of the order of injunction served on me. Apart from this order of injunction, there is a major stumbling block and this is the non-registration of the out-of- court settlement. I have been working hard to see that this would not be against Hydroma. Again, it is important that we liaise with the consultants to the project to get the certification done as soon as the problem with SAGEM is settled and this may be very soon Adesanya wrote."

Beyond this, certain correspondence between Gaon and Jeff Schmidt, an American and debt advisory consultant, who has been involved in Nigeria for a long time suggest a connection of the principal characters and certain companies involved in the identity card project.

On 2 October, last year, for example, a fax message marked "personal and confidential," addressed to David Gaon from Jeff Schmidt discussed suggestions on how to split the revenue coming from the card project. Entitled "supplemental project" the fax message read in part: "I will like to recount our conversation of yesterday with relation to the financial split of the revenue coming from the completion of the identity card project and the supplementary project. In the first option which Schmidt calls the "New Outside Investor," he offered that cash flows from the projects will be split thus: Noga Group will have $6.5 million up-front payment and $7.8125 further eight payments totalling US $69 million to the Noga Group. The BIL (Bishopley Investment Ltd.- Schmidt's group), will earn $7.5 million upfront totalling US $65 million. "With the completion of the project, Smith assures the underlying notes would be surrendered to Noga and there would be no claims on any party in the transaction. The Noga Groups includes the new investor and all payments needed to fulfil the ID card project and supplementary project," Schmidt said.

The "second option," as Schmdit calls it, "ties the U.S.

investor to the deal."

Under this second option, the Noga groups suggested Schmidt, will have a total of $52 million while BIL group will get $82 million.

Schmidt's profile, his other deals with Gaon, and involvement with Mecosta Securities Incorporated named in the controversial Ajaokuta debt-buy-back scam suggests, that both might have fleeced the nation on the identity card scheme. When Schmidt's began financial advisory services to Nigeria is not known. But inquiries at the Central Bank of Nigeria (CBN), and the Finance Ministry, Abuja, confirmed that he has been known figure in official financial circles since the Babangida's days. Along with Selwyn Louis, a South African, Robert S . Minton an American, they did debt-buy back business for African countries. With a company called Growth Management Limited, Schdmit, Minton and Louis, allegedly built front companies to do debt-buy-back business in Nigeria and Turkey.

Four weeks before he wrote Gaon over the split of revenue coming from the identity card project, Schdmit wrote Abubakar's finance minister, Malam Ismaila Usman, offering the advisory services of four firms: Warburgs, Lazard, Owen Stanley/ING and African Merchant Bank. Apart from scheduling to meet Ismaila, Schdmit also offered to manage the Paris Club debt process, asking tacitly, for a management role in Africa Merchant Bank. It could not be ascertained whether Schmidt's struck any deal before Ismaila left.

But while offering financial/debt advisory services to Ismaila, while discussing with Gaon on how to split the cash flow from the identity card project, Schdmit's Bishopley Investment was also perfecting a debt-buy back deal purchase of Nigerian promissory notes on the identity card scheme.

Not less significant is that Schmidt's Bishopley Investment Limited is registered in British Virgin Islands as is Mecosta Securities Incorporated, the principal player in the controversial $2 billion Ajaokuta debt-buy-back fraud. It suggests that Gaon might know more about conduit that is Mecosta Securities Inc. than he is willing to admit.

A fax message dated 28 September from one Rene Romy demonstrated certain inscrutable transaction between Mecosta's Schmidts and Gaon. Said Berry in the fax message, "Further to your discussions with Mr. David N.

Gaon, please, find herewith enclosed copy of the swift message confirming transfer of the sum of US $1,500,000 value today the 28 September."

Why Schmidt asked for Gaon to transfer this sum to him is not known. But a telex payment confirmation print out form Standard Chartered Bank, 7, World Trade Centre, New York, NY 10048, shows that $1.5 million was transferred to Standard Bank, Isle of Man Ltd. It was for further credit to Trident Trust Company (IOM), Limited, one of Schdmit's many concerns.

With such deals with Schmidt in 1998, is it possible for Gaon to claim innocence or ignorance of the role which Mecosta played in the $2.5 billion deal gone sour? And, what are Gaon's other unknown roles and interests in the N17 billion identity card project? The nation might not know. But Gaon's relationship with Schdmit, who transacted business with Mecosta and SBLL, speak volumes.

The odour of the $2.5 billion scam stinks to the heavens.

Along with Panar Shipping Corporation of Liberia, Mecosta fronted for the late Gen. Sani Abacha, his son Mohammed, and former finance minister, Chief Anthony Asuquo Ani, in the monumental fraud that was the N250 billion ($2.5 billion) Ajaokuta debt buy-back deal. Gen. Abubakar's laconic press secretary, Malam Mohammed Haruna, who uncorked the stench said Ani, Dalhatu and Mohammed Abacha, using Mecosta and Panar as fronts, collected $2.5 billion from the Nigerian government, paid only $500 million to the Russians and pocketed the balance. All have returned $58 million and DM30 million, Haruna said.

Ani and Dalhatu claimed that Haruna lied . Dalhatu denied having refunded $5 million from the deal. Dalhatu claim he was involved after Ani told him that Abacha had authorised the finance minister to close a deal with the Russians.

Ani maintains that he was not involved in the presidential debt stock. Instead of paying $1.998 billion, Ani said the country paid DM973 million or ($640 million) and thus saved $1.358 billion. To the best of Ani's said a TELL magazine story last December, "there was no offshore company into which another money was paid apart from the $640 million paid to Mecosta." The bottomline of this claim is that Ani lobbied Nigeria to save money from the deal, that he was not privy to the finer details of the deal with Panar, and between the Russians and Mecosta.

"What Mecosta paid the Russians," a source told TELL, was its own business, based on its own negotiations with Tyazhpromexport," the Russian contractors. Nessim David Gaon, who paid Schdmit $1,500,000 for some undisclosed transaction in 1998 has, however, punctured Ani's claim of innocence, non- involvement and ignorance in the finer details of the scam. He has filed a suit in London against Ani, Aly Abacha, Australia and New Zealand Banking Group, ANZ, Abacha, Mecosta Securities Incorporated, Panar, Citibank N.A. Mohammed Sani Abacha, Abubakar Bagudu and seven others. The gist of Gaon's claims, in an affidavit filed for him by Joel Herzorg, is that the individuals, banks and companies were conduit for stolen money running into hundreds of millions of dollars. "

Russia, Gaon said, sold to Noga, various bills of exchange guaranteed by the Nigerian government. Clause 12 of 1992 agreement provided that all payments made by the employer and or the guarantor in relation to the bills of exchange shall be paid into Noga's accounts "until so paid, the ministry, the contractor and the bank should hold such amount in trust for the company." Abacha, Gaon said, soon approved the acquisition by the Federal Government of note issued in connection with the project. This formed the basis of DM973,009,450.6 that was the purchase consideration of DM1,835,866,878.22.

On 16 May 1996, Abacha approved the transfer of DM486,504.725.30 (50 per cent) of purchase consideration to ANZ Banking Group, A/C No. 000083-001, Attention Emerging Market Operations, Re- Mecosta Panar Escrow. A telex confirmation followed the transfer, the following day. A month later, (25 June 1996), Bashir Dalhatu, the Power and Steel Minister, wrote the CBN, conveying Abacha's approval of the assignments of the bills of exchange to Panar, while ANZ should hold the bills in escrow till finalisation of the assignment with Panar.

Five months later, Ani, according to Gaon, asked the CBN to transfer the 50 per cent of DM486,504,725.30 to CitiBank, A.G. Frankfurt, Germany, Abacha having so approved. This was to account No.411-3199- 003. It was to be credited to Merril Lynch Bank (Suisse) Securities Inc.

The code is Masalama, some 30 days afterwards.

A month later, Ani told the CBN governor that Abacha had asked him to negotiate with Mecosta to buy the Russian debt at 53 cents in the dollar. On 7 April 1977, Ani asked the CBN governor to pay the dollar equivalent of DM486,504,725.30 to CitiBank, New York, NY, ABA No.

021000089, A/c of Goldman Sachs and Go Bank, Zurich A/c No 3849-3226. The beneficiary: Mecosta Securities Inc Ref.

C518. An 11 April, 1997 telex, says (Herzorg), issued to Morgan Guarantee Trust by the CBN asked that this payment be made to Mecosta.

Herzorg's claim which combusted Ani's claim of innocence or aloofness is this: that based on "confidential inquiries," on Mecosta account, Ani, Abacha and his son were signatories to Mecosta's account. "On the basis of that information (confidential inquiries) he (Gaon) made that signatories to Mecosta's account were up until very recently (May 1999), Aly, Sani, Ani. It is my (Herzog's) belief and that of Mr. Gaon that "Aly" stands for Gen.

Abacha himself, or his eldest son, Mohammed Sani Abacha, and that "Ani" is Chief Anthony A. Ani, the Minister of Finance at that time." Herzorg said further that Mohammed Abacha and Abubakar Bagudu are now the new signatories to Mecosta's accounts.

Following the publicity on the debt buy-back and escrow accounts, Mecosta in February, this year, transferred $84.5 million to the Standard Bank of London Limited.

"Abubakar Bagudu gave instruction to Steven Hawkward at Standard Bank, London Limited, for this tranche of Nigeria par bonds to be transferred to Banque Worms for credit to Banque SBA account No. 003 563 75391. The beneficiary was Standard Alliance." Gaon claims, that, Mr. Hawkward of Standard Bank of London was involved in transferring the balance of $2.5 million of the $90 million portfolio from his bank. The courier bank this time, was Credit Lynonias, New York, for the account of Banque S.B.A. at A/c 010856700001000. The beneficiary of this transfer was also Standard Alliance. "This payment in cash was the balance of the Mecosta portfolio in Standard Bank, London Limited."

The totality of Gaon's contention against Ani, Mohammed Abacha, ANZ, Mecosta, Standard Bank of London, Standard Alliance, Panar, Citibank NA and others is that they were conduits and beneficiaries of the DM973,009,450.60 transferred out of the country in May 1996 and April 1997.

He prays the court to freeze the pay bonds, their proceeds and other fruits of the bills of exchange so that the assets may not be transferred into a different name, sold or escape through the net. So the question subsists:

Can the sale of Noga promissory votes on the card project first from Gaon's Noga, to Hydroma, where David Bester, Schdmit's partner in Trident Trust has interests, then later to African Assets, then to Schdmit's Bishopley Investment, be part of some grand deals to profiteer from the card scheme? As it were, Afro- Continental, the longest-serving contractor on the identity card project is yet to pay the legal fees of its counsel, Adeniyi Odunsi, for out-of-court negotiations.

Odunsi has slammed a suit on Afro, Hydroma, the Central Bank of Nigeria, the Federal Government, the Finance Ministry and Prof. Adesanya. He is praying the court to stem contract payments to Afro- Continental. Justice T. A.

Odunowo of the Federal High Court, Lagos, hearkened to Odunsi's prayers with an interlocutory order on 21 January that Afro, Noga and Hydroma should not be paid till all have honoured their undertaking to Odunsi his $250,000 legal fees. The News could not confirm whether the payments to Hydroma and other companies now involved in the project before Abubakar left, violated the court order.

The stalling of payment to another company, Chams Nigeria Limited, appear self-inflicted. Chams is the Nigerian representatives of Datacard of America, which owns the franchise over smart cards all over the world. The latter was invited by SAGEM to supply the personalisation cards for the project. When Chams was to be paid, a source in Abuja told The News, the company provided the U.S. account number of its managing director, Ben Aladekomo, instead of the company (Cham's) account number. The U.S. bank balked at honouring the $4.2 million cheque, leaving a total of $8.4 million outstanding to Chams.

It was not possible to speak with DNCR Project Director, Chris Agidi, two weeks ago in Abuja. He was said to be away to brief the new minister. At the ministry, the CPS, Bellu, advised The News to write Agidi, who will now speak after authorisation by the minister. Such authorisation never came before we went to press. The magazine's request for a chat with the finance minister was not replied.

An assistant director in the internal affairs ministry however told this magazine: "You know all these things. I know. . That is what has delayed the project. You didn't steal money, I did not. Everybody knows those who did."

Except that nobody is apprehending any of them, though.

The project is almost completed. Only installations of new sets of imported computers in the zone remains pending .

The payment of about $14 million to three contractors is outstanding too. But the N17 billion identity card scheme is one project that deserves the focus of President Obasanjo's probing lens. Such scrutiny, should establish at the very least, the exact role of international businessmen in the long tale of fraudulent delay that has been the identity card scheme.