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Senate Indicts Federal Mortgage Bank Over N4.5bn Loans, Contract

THE Senate has indicted the Federal Mortgage Bank, FMB for non- recovery of loans and illegal award of contracts to the tune of N4.5 billion.

The Red Chamber arrived at the decision following the report of its Public Accounts Committee, chaired by Senator Mathew Uhroghide (PDP Edo South) after the consideration of 2018 report of Auditor General for the Federation, AuGF.

The breakdown of the mismanaged fund showed that the management of the bank irregularly awarded N3.4bn contracts, while it also failed to recover N70 million trapped in a defunct bank.


In addition, the bank failed to recover arrears and outstanding balances of loans trapped in primary mortgage bank and micro finance bank which is about N1.3 billion.

The bank also failed to recover N79 million loan granted to former officers of the bank and non recovery of loan granted to former directors which is about N65 million.

The query by the AuGF reads: “Contract awarded to a contractor in four places at a total sum of N3.0 billion. The 2nd , 3rd and 4th phases of the contract were above the approved threshold of the bank.

“It was observed that the contractor was overpaid in the sum of N118m that resulted from irregular addition of 5 percent WHT in the bill of quantity on each of the four phases of the contract.”

The bank, in its response said the contractors have been engaged on issues raised by the Auditor General and a settlement agreement has been entered into for refund.

The Senate panel then ordered the FMB to account for the sum of N3.0 billion contracts that were irregularly awarded.

According to another query, “the sum of N1.3 billion granted as loans to six primary mortgage banks and a micro finance bank, remained outstanding as of the time of audit in 2017.”

The agency in its response said the loans have already been referred to Nigeria Deposit Insurance Corporation, NDIC to assist in the recovery of the funds.

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