‘Above The Law’: How Nigeria Football Federation exploits ‘borderline’ status to mismanage funds

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Nigerian football officials are hiding behind the Federation of International Football Association (FIFA) regulation that prohibits government’s interference in football matters to divert grants and funds from sponsorship deals, a PREMIUM TIMES investigation has revealed. FIFA makes it mandatory for its members to be free from the control of the government as well as its finance-handling systems, such as Treasury Single Account (TSA), financial regulations and statutory audit inspections, in the case of Nigeria. But our weeks-long investigation showed that the Amaju Pinnick-led Nigerian Football Federation (NFF) exploited this independence to mismanage funds at its disposal, which include allocations from the public treasury.

Our investigation involved reviews of official documents from the NFF, the Economic and Financial Crime Commission (EFCC), the Presidency, the Ministry of Youth and Sports as well as testimonies of people familiar with the operations of the football federation. The sports ministry is particularly worried about public accountability problems associated with the finances of the NFF. It has not only set up an inter-ministerial probe committee to investigate alleged corruption at the football federation, it has also referred the body to the EFCC.

This paper understands that the sports ministry struggles to come to terms with NFF’s lack of regards for it (the ministry) and government’s regulations in handling finances, whereas the football body receives funding from the government through the federal budget.

In the budget, the NFF is listed as a ‘parastatal’ under the ministry and, that way, it receives public funding. The body was allocated N1.3 billion and N1.1 billion in the 2016 and 2017 budgets, respectively. Apart from federal funding, NFF finances its operations from sponsorship payments and grants from FIFA and CAF. But for all cases, the ministry, as our investigation revealed, expects ‘proper documentation’ of the NFF’s finances.

So, in December 2016 the sports minister, Solomon Dalung, petitioned the EFCC requesting an investigation of the NFF’s finances with regards to $802,000.00 which he said was a FIFA grant and had not been accountably managed. However, in a November 2018 letter to President Muhammadu Buhari, after Mr Dalung’s complaint that the EFCC was reluctant to act on his petition, the anti-graft body said in two years, beginning January 2014, the NFF under Amaju Pinnick had received a total of $16.4 million – including over $13 million from FIFA alone and the rest from CAF – into its domiciliary accounts domiciled with the Zenith Bank and UBA.

As the EFCC revealed, that was far beyond the amount that prompted Mr Dalung’s petition.

‘Diverting’ FIFA’s money

The EFCC said it uncovered multi-million-dollar fraud in the finances of the NFF upon investigation and has charged some of the officials to court.

“Sir, investigation into this case has been concluded and the following officials of the NFF were indicted…Christopher Andekin, director of finance and administration; Jafaru Mamzah, head of finance and administration; and Rajan Zaka, Cashier,” stated the EFCC, on the investigation into the funds received from FIFA and the CAF, in its November 2018 letter to Mr Buhari.

The three officials indicted are now facing trial for criminal conspiracy and breach of trust by a public officer at an FCT High Court in Abuja. At least $10 million was stolen by the three officials, according to the prosecutor in the court filing seen by PREMIUM TIMES.

Respectively, Messrs Andekin, Zaka and Mamzah diverted into their separate private accounts from NFF’s domiciliary accounts $1.3 million, $7.2 million and $2.2 million, being parts of FIFA funds for the development of football in Nigeria, the EFCC stated.

But insiders have said the three officials were just pawns. “They just only arraigned some messengers, leaving the approving authorities,” said Harrison Jalla, an ex-international and president of National Association of Nigerian Footballers. “We have protested and demanded that Amaju Pinnick and others be prosecuted.”

Curiously, despite funds received from various sources, including billions of naira sponsorship payments, the NFF still asks state governments to foot its entire bills, including accommodation and feeding of officials and players and bonuses for players, when Nigeria has home matches.

Also, a document, filed to the EFCC by the NFF, detailed the purported use of $8.4 million received from FIFA for participating in the 2014 World in Brazil. In one case, the NFF said it spent $74,000.00 on office expenses on December 23, 2015, and about seven months later in July 2015 another $93,000.00 on office expenses.

Yet, annually, the NFF receives public funding – more than a billion naira in each year – through the federal budget for routine office expenses, including internet, telephone, electricity, water supply, books, newspapers and stationeries, maintenance of office building and residential quarters and maintenance of office furniture and vehicle, among others.

“This is not only a lie but it is being presented to cover for the huge shortfalls in the retirement,” said Mr Jalla. “All that they call retirement was just an invention.”

Also in the document sent to the EFCC, the NFF said between February 12 and March 12 of 2015, it gave a total $650,000.00 to JER Trade Consulting for a purported international friendly between Nigeria and Bolivia in Dubai.

There is no record this match ever held anywhere. Our checks revealed the match was originally scheduled to hold in Uyo, Nigeria, after the Super Eagles’ planned friendly with Brazil hit the buffers that year. But authorities in Bolivia called off the match citing security fears associated with Boko Haram terrorism, which, however, is active in Nigeria’s northeast far from the planned venue, Uyo, in the south-south.

“It would be an easy pick for Amaju in Europe,” said Mr Jalla of the money the NFF claimed it had paid the foreign agent for the aborted match.

Mr Jalla said it was even an agent that pays teams.

Following the arraignment of the NFF officials, the EFCC appeared to have rejected the details of spending that $8.4 million FIFA money. Sources knowledgeable of the matter said Mr Pinnick too may be charged soon.

The only reason the NFF ‘invented’ something to explain its spending was because of EFCC’s involvement; otherwise, the football body ordinarily operates opaquely, and officials allegedly mess with funds, abusing FIFA’s requirement of no state interference in its affairs, insiders told PREMIUM TIMES.

In an October 2016 FIFA’s ‘key findings report’ on the use of development funds released to the NFF, the Nigerian body was questioned for non-compliance with set standards, lack of transparency and misapplication of funds.

Even though the NFF replied FIFA, explained itself and promised improvements, a source said the global body was not satisfied and has stopped giving the Nigeria football development funds (different from FIFA grants). We could not independently verify this claim and relevant NFF officials refused to speak.

‘Government financial controls can’t apply to NFF’

Reports of both the EFCC and the inter-ministerial probe committee set up by Mr Dalung as well as a review of minutes of the NFF’s executive meetings revealed that several sponsorship payments due to the NFF were received and kept in third-party accounts of consultants. NFF also makes payments to other parties including Coach Gernot Rohr from the payment.

NFF’s most important consultant is Financial Derivatives which in one case helped the football body receive $800,000.00 from Coca Cola, according to the EFCC and the NFF’s July 2018 correspondent endorsed by Salihu Mohammed, the director of finance and administration.

But for the government, according to the inter-ministerial probe committee report, this is considered a disregard for such financial systems as Treasury Single Account, Financial Regulations and statutory audit inspections.

NFF’s second vice-president, Shehu Dikko, is believed to have interest in one of the so-called consultants, Mediterranean Sports Ltd., which takes 20 per cent as commission for sponsorship deals. We saw at least three letters to Financial Derivatives for the purpose of paying Mediterranean commissions.

Although insiders alleged conflict of interest and that the firm is owned by Mr Dikko, Corporate Affairs Commission (CAC) papers we reviewed showed he had resigned his directorship since May 2014 before taking the NFF job.

Meanwhile, the inter-ministerial committee reported no record of a valid contract between the NFF and the company. However, a record of the 19th executive council meeting of the NFF showed that the company got an approval to take 20 per cent as commission from sponsorship deals.

When contacted for an interview on this report, the Financial Derivatives’ boss, Bismark Rewane, confirmed the Lagos firm’s involvement with the NFF’s finances. He said government’s financial controls like TSA, FRs or statutory audit inspections “are not applicable to the NFF” because “it is not a government body.”

“He (Mr Rewane) is right,” affirmed legal expert, Jiti Ogunye. “The NFF is not a government body.” But since it received funding from the federal budget, Mr Ogunye said, the body would have to comply with government regulations to the extent of the terms of the Appropriations Act.

However, Mr Ogunye said the NFF is a public body for the fact that football is public value in Nigeria and the body enjoys the membership of FIFA because “it is representing a state, the Nigerian public.”

“So, NFF being a public body owes Nigerians the duty to be publicly accountable and transparent,” Mr Ogunye added.

Both Messrs Ogunye and Rewane have their views rooted in the FIFA’s strict position that its members shall not operate with state interference. Also, there is no appropriate government statute guarding the operations of the NFF.

There is a Nigeria Football Association Act, coming from the military era. But at a football congress in Makurdi, Benue State, in 2008, the nomenclature changed, birthing the NFF and disabling the NFA Act. Since then, the NFF has been operating with statutes approved by FIFA.

Mr Ogunye called NFF a ‘borderline body’.

But a spokesperson for the ministry interviewed for this report, Nneka Ikem, said: “of course the NFF is a parastatal under the ministry of youth and sports development.”

When this paper talked about the independence of the NFF as required by FIFA, Ms Ikem queried: “How can you say that when their funds come under the ministry in the budget like the NYSC and other parastatals under the ministry?”

Last year, the permanent secretary for the ministry, Adesola Olusade, told the House of Representatives sports committee during a hearing on the now-stalled NFF Bill that the government “is not in any way interfering in the activities of the NFF” in recognition of the FIFA terms. But he expressed worry about accountability.

“They are being funded through the budget as a parastatal…FIFA does not fund the NFF completely, yet they use it to harass the government. This is robbing Peter to Paul. For instance, the NFF has not shown the capacity of prudent financial management over the years,” the official said as reported by Vanguard newspaper.

The permanent secretary may not be wrong. What our investigation has shown is that the Pinnick-led NFF abuses the freedom from interference and being subjected to government financial controls.

Even within the NFF, there are concerns about keeping ‘public’ money in a third party’s private account.

We saw a correspondent by the financial and administrative director, Mr Mohammed, expressing disagreement with Mr Pinnick’s leadership on the management of sponsorship funds.

“I wrote a memo requesting that the funds in the custody of the Consultant be transferred back to the Federation’s (NFF’s) account since such funds are public funds and kept with the Federation in trust,” wrote Mr Mohammed in a July 2018 letter to Mr Dalung on several payments taken by Financial Derivatives on behalf of NFF.

In that letter, Mr Mohammed also included payments taken by NFF directly. That included N450 million from Nigeria Breweries and another N150 Million from the Zenith Bank. That list also included Nike but with no corresponding amount. The column for the amount received was just left with ‘??’

One source, an NFF insider, said Mr Mohammed decided to write Mr Dalung having discovered corrupt and poor accounting practices with regards to the public money kept in the private account of the consultant.

There is no clear and transparent documentation of the proceeds of the Nike deal.

Mr Pinnick shunned repeated calls and text messages to request an interview for this report. But NFF’s spokesperson, Ademola Olajide, when contacted, declined comment on his organisation’s finances.

“My brother, it’s not a topic I have interest in honestly,” he said.

Nigeria Football Federation Glass House