CBN has been faulted by the Nigeria Senate on its roles in the alleged mismanagement of N120 billion released to the aviation sector out of the N500 billion intervention fund by the Federal Government in 2011.
The Senate also took exception to the roles played by beneficiaries of the fund, which power, small and medium scale enterprises, SMEs, also benefited from.
A probe by Senate Committee on Aviation and Anti-Corruption alleged that N120 billion allocated to the aviation sector as bailout, from the entire N500 billion CBN intervention fund, was mismanaged.
However, the Minister of Transportation, Mr. Rotimi Amaechi, told the committee that his ministry and agencies under it were not aware of the fund. His submission made the committee to demand from the CBN Governor, Mr. Godwin Emefiele, represented by a Director, Mudashiru Olaitan, to explain how the money was used in view of the financial problems still bedevilling the sector.
The CBN representative said out of the N120 billion intervention fund injected into the sector, only N39.5 billion had been recovered while the balance of N81.2 billion was still outstanding. He admitted that some of the 10 Airlines that benefitted from the fund were now moribund, which, according to him, was against the objective of the fund.
He named AirNigeria and Chanchangi Airlines as the moribund ones, while Arik, Dana, Aero, Kabo, Overland, First Nation, Odenegene are the ones still in operation on the strength of the fund.
When probed on why two out of the 10 airlines folded up despite the intervention fund, he said responsibility for monitoring the implementation of the fund was given to Bank of Industry, BoI, being the facilitator of the loans. Other stakeholders at the session, such as John Nnorom, who served as Finance Director of now defunct AirNigeria, said diversion of the fund to other ventures led to the collapse of the airline.
According to him, “The N34.5 billion drawn from the fund by the airline was diverted to other personal business by the owner of the Airline, Jimoh Ibrahim.
“The very moment the N34.5 billion intervention fund was paid into the Airline’s account with United Bank for Africa, UBA, it disappeared into one of the private accounts of the owner without any amount from the fund injected into the airline, paving the way for its eventual collapse.”