Malabu Scandal: UK govt authorised transfer of $875 million to Etete – JP Morgan
The UK anti-money laundering unit, Serious Organised Crime Agency (Soca), gave authorisation for the transfer of $875 million to accounts linked to a former Nigerian oil minister and convicted money launderer in the controversial Malabu scandal, JP Morgan has said.
The shocking revelation is contained in High Court documents filed by U.S. banking giant, JP Morgan Chase Bank, last week, seen by PREMIUM TIMES London partner, Finance Uncovered.
The claims were filed by the bank to counter the massive claim for damages filed by the Federal Republic of Nigeria in 2017.
Last November, the Nigerian government had quietly sued the bank for $875 million (N315 billion) in the London courts over its alleged failure to block payments made from the massive Malabu oil deal that is subject to a string of international corruption investigations.
The notorious Malabu deal, involving OPL245, involved Shell, Italian oil company ENI, a convicted money launderer and former Nigerian oil minister, Dan Etete, a former Nigeria president Goodluck Jonathan and his then oil minister, Dieziani Alison-Madueke.
The court claims were made as part of a wider drive by President Muhammadu Buhari to recoup massive sums believed to have been siphoned out of Nigeria by previous regimes.
In the civil claim issued in the High Court, the Nigerian government argued that JP Morgan had been “grossly negligent” when it was banker to a previous government. The claim, seen by Finance Uncovered, alleged that JP Morgan did not act “with the reasonable care and skill to be expected of a bank in compliance with the laws of England and Wales” when it authorised enormous payments resulting from the 2011 oil deal.
There was an “abuse of the banking system”, the claim said, adding that JP Morgan “could and should” have done enough reasonable due diligence to discover the deal involved the “misappropriation” of up to $1.1 billion from state coffers. It, therefore, demanded that the bank repay $875 million it paid out to the money launderer, plus interest, and to account for the rest.
But in its counter claim, the U.S. bank claims it repeatedly sought consent from the Serious Organised Crime Agency (Soca) to make the payments and instead of being told to block the transfers, the bank says it was given the green light to proceed.
Details of why that permission was granted has not been explained, but campaigners say the decision means there is “real cause for concern” about the UK’s current anti-money laundering regime.
The documents show that the green lights to make the payments in two tranches in 2011 and 2013 were given by Soca, at the time the UK’s main anti-corruption unit which reported to the then Home Secretary, Theresa May.
