In this interview with leaks.ng, Tola Adekoya, of the School of Banking Honours, gives an account on how his school first brought the issue of the unremitted N20 trillion stamp duty to the fore and who are those with questions to answer.
How did your agency, the school of banking honours, come about the issue of unremitted stamp duties for the government?
The School of Banking Honours is the first innovation enterprise institution in banking sector. We are the first banking monotechnic listed by NBTE in Nigeria.
We figured out that there is a major problem with banking in Nigeria today which is retrenchment. The youth of this country are running away from banking going into other professions like accounting and so on. They believe banking is a closed market and with the retrenchment going on, they became scared and so the onus is on us as the first banking monotechnic to create alternative jobs that will engage them in large volumes as to make banking attractive. And what we are putting in place is what we described as shadow banking. All those expensed bankers that are being retrenched are going to be absorbed at a lower level than banking to be able to teach, impact their skills on the incoming younger generation for banking not to lose its relevance. That is the main focus.
To start up, we carried out research, we brought out about 12 products that will sustain shadow banking. The first of those 12 products is stamp duty, which is overlooked in banking for over 20 years until our research brought it out.
One of the evidences you need to see on the stamp duty is to look at any cheque leaf from any bank you will see “stamp duty paid” embossed on the cheque leaf. But these monies are not remitted to the government and that was where our research started.
What year was this?
We started in 2011 and then moved into 2012, cashless policy started in January 2012.
There is the issue of N20 trillion that the government supposed to earn. How did you arrive at this figure?
Very simple! Number one; cashless policy was an innovation of Central Bank and it is supposed to provide alternatives to cheque payment which will be faster and electronically delivered. But various laws are there, we approached CBN to partner.
What was their contention?
At the time we had the approval they had the approval to charge on transactions from N500,000 upward while the approval we got from government is from N1000 upwards and the managing director of NIBBS, Mr. Folashodun Adebisi Shonubi, challenged me to say that “look transactions below N500,000 to 1000 are so voluminous so huge that if you apply N50 on them we will be recording revenue that will push oil into a distance second.” These were his exact words on 7th January 2013 when we served NIBSS a letter of engagement to be sweeping stamp duty from the banking sector into government sector. We are just going to get our commission and probably share with them.
How did they shut out government?
They issued the circular and then we said, where is the government’s share? And when they didn’t listen to us we served them a demand notice and then NIBBS said come and collect it, I have all the papers. He (the then NIBSS managing director) sent an email to me on the 5th of July 2015, come and collect it. But CBN is adamant, CBN that gave approval and then switch the approval of the government for private sector has been restricting it.
How are they restricting it?
It’s quite easy. They have a mandate you are supposed to accept only naira currency from stamp duty and so we expected them to issue a circular which they didn’t. The circular they issued only favoured the banks against government. It favoured banks against their pay master and that is what I object to, that’s how they tried to frustrate the collection of stamp duty based on NIBSS complains.
But you said NIPOST was over ambitious?
You know we were the custodian of the mandate to roll in stamp duty from banking sector that was why we signed an agreement and it was based on our research. We needed the government representative, we are not government, we are just consultants, researchers trying to add value to this country.
So, the onus was on us to right all the wrongs that were being perpetrated by CBN and NIBSS, so we needed to get in touch with the President and Commander-in-chief of the Nigerian Armed Forces, who at that time was President Jonathan.
We were trying everything possible to reach him and along the way we met a woman, who we understand was the cousin to President Jonathan. She delayed us, deceived us for over six months we couldn’t get President Jonathan to report CBN. So we had to look for alternative that brought us to Kashamu. I am from Ogun State and the only coordinator for Jonathan in Ogun State was Buruji Kashamu. So when we met the traditional ruler of our area, he said it was Buruji that will get us Jonathan within 24 hours, but when they set up the meeting with Buruji, he had another plan entirely. He didn’t want to go to Jonathan. In fact he ran to NIPOST behind us to push us aside that he was going to get them judgement.
So you mean to say that NIPOST went to court to…
Buruji Kashamu lured them to say he was going to get them judgement, and he did. But in the process of getting them judgement, NIPOST made an error. They never sought the advice of the Attorney General of the Federation in accordance with section 58 of his enabling act. It went behind the Attorney General of the Federation, went to Buruji Kashamu to initiate an ill-advised court case against banks on one hand and against CBN on the other hand. So we didn’t start any court case, we were just watching, we were helpless. From trying to see the president of this country to illegality of a case that didn’t follow due process. We were shocked.
Before they went to court, before the claim, when did they begin to collect the stamp duty?
It is irrelevant to us because they issued a circular in 2016, I mean that is outrageous. We got approval in 2012 and then you switched the approval of government to private sector because of the volume of funds involved. CBN tampered to the whims of NIBSS by switching approval of government for private sector, that is criminal and we have all the papers then you now came on January 2016 to say that okay you negotiated with NIPOST and KASMAL to now issue a circular in January 2016 against the law.
What was the circular about?
That bank should now start remitting stamp duty of N50 from transactions to government coffers. They opened NIPOST stamp duty account that the money should go there. But the banks were already in court they were fighting NIPOST and KASMAL back for initiating such a court case against them, and the banks won.
The appeal court threw away NIPOST claims and said NIPOST should not have anything to do with stamp duty.
So Kashamu and NIPOST got two judgements; first judgement was against banks and second was against CBN. But in their anxiety or in their ambition to cover the entire funds due to the entire government they committed perjury in three ways. The first perjury they committed was on contract dates, in the judgement that KASMAL got against banks he said he had contracts with NIPOST ending October 2018. In the judgement on the same contract he had against CBN, he said the same contract ends October 2015, which one should we take? And then when CBN asked NIPOST to say do you have a contract with KASMAL? NIPOST replied to say it doesn’t have a contract.
So, who has KASMAL?
It is Buruji Kashamu, now a senator. He was the PDP leader in our state and we went to him to take us to Jonathan and he did all these abracadabra and we couldn’t understand.