EFCC Investigation of AKSG Fees: I have not been arraigned in court – Paul Usoro, SAN

Just before reviewing our performance in 2018/2019 Q1, it is perhaps only right that I address the orchestrated social and online media reports of the last 24 hours in regard tomy allegedly being charged to court for money laundering offences by the Economic and Financial Crimes Commission (“EFCC”). I have not been served with any such charge neither have I been arraigned before any court on any such charge or at all. It is however correct that I have been questioned by the EFCC in the last several months in respect of fees that my Firm had been paid by Akwa Ibom State Government (“AKSG”) between 2015 and 2016 and also fees that Governor Udom Emmanuel, the Governorof Akwa Ibom State had paid to me for the benefit of Counsel that worked on his Election Petition Appeal that was decided by the Supreme Court early in 2016.

Luckily, I had kept a contemporaneous and detailed record of my visits to the EFCC offices in Abuja and it would be useful that I quote excerpts therefrom on the facts of the EFCC investigation for the benefit of you, my colleagues:
“I was invited by the EFCC Bank Fraud Section, vide a letter of 28 May 2018, to provide “clarification” in respect of “a case” that they were investigating. I met with them on Monday, Tuesday and Wednesday, 04, 05 and 06 June 2018 and their questioning of me was on two specific issues as outlined below.

(a) “Zenith Bank N300m Inflow

“I was questioned in respect of a N300m cash inflow that came into PUC’s Zenith Bank Account on 14 March 2016 and the subsequent outflows from the account to various Senior Counsel between 22-23 March 2016. I explained that the inflow was payment by Governor Udom Emmanuel in respect of an Election Petition Appeal that was determined by the Supreme Court and that I served as the coordinating Counsel in respect of the matter and had engaged various Senior Counsel therefor on his behalf. The subsequent outflows which were made through bank transfers were the professional fees which I made on his behalf to those Counsel based on the N300m inflow. They wanted to know how the cash lodgment was made into the PUC account and I informed them that the lodgment was made at the instance of Governor Emmanuel (albeit, not necessarily by him) and definitely not by me or any PUC personnel and that I had no further information, clue or knowledge beyond that.
(b) “N1.110bn Inflows into PUC’s Access Bank Account from AKSG

“EFCC also wished to know the basis for the aggregate inflow of N1,110,000,000.00, paid in 4 tranches, into the PUC Access Bank Account from AKSG between 24 August 2015 and 18 September 2016. I provided an explanation in writing to them showing that these were payments-on-account by the State in respect of several dispute resolution matters that we were and, in some cases, are still handling for the State Government.

I backed the explanation up with (a) copies of the PUC Notes of Charges in respect of 3 of the 4 payment tranches, pursuant to which the payments were made and which clearly showed that these were payments-on-account in respect of various matters that we were handling for the State; and (b) a non-exhaustive List of 19 matters, none of which was election-related, which we were handling for the State at all times material to their enquiry and the payments. We pointed out that we were in the process of reconciling accounts with the State Government in order to determine the outstanding fees due from the Government to us and that for none of these matters were we previously paid by the State Government.

“They questioned me on the agreed fees for each of the matters and I told them that there was no such agreement which explains why the payments were made on account, albeit, there is a reconciliation process afoot. They asserted that from their experience, fees are always agreed in advance with counsel prior to engagement. I strenuously refuted that assertion and gave them illustrative instances where we’ve worked for FGN – the MTN Fine case, for instance – and fees were not agreed in advance and we haven’t even been paid as I write.

I also gave instances of very established organizations where we’ve experienced the same circumstances and concluded by informing them that the processes for engagement of counsel and negotiation/payments of their fees are not standard and immutable but remain the exclusive prerogative of the client and are at the clients’ discretion. They asked for our letters of engagements and I explained that traditionally, letters of engagements are not issued to us by the State in these matters; the State merely hands over the processes to us and requests that we represent the State in the matters or institute required proceedings on behalf of the State.In any case, I told them that I wasn’t aware that AKSG was complaining howsoever in respect of these fees or denying that we had provided the services outlined in our letter and even if they were, the court/arbitral records and processes in these proceedings are available to bear our services out.

“Attention then turned to the payments that PUC made to some senior counsel at all times materials to the EFCC investigation. Soon after the payment-on-account of N530m by AKSG on 24 August 2015, we had made some payments to several senior counsel. Similar payments were also made soon after the payments to us by AKSG of N260m and N280m respectively on 03 December 2015 and 18 January 2016 and the EFCC wanted to know what these payments were made for. I explained that these were the same set of Counsel – comprising eminent members of the Inner Bar and a host of other members of the outer Bar – that I had engaged to work with me in respect of the Election Petition matter for which payments were made from the PUC Zenith Bank Account (for the Supreme Court Appeal) and that these payments that were made from the PUC Access Bank Account were professional fees which I paid to them for their services at the Tribunal and Court of Appeal. They wanted to know if I was paying them out of the AKSG payments-on-account and I answered in the negative. I explained that these were independent transactions and that the AKSG payments-on-account were in respect of my Firm’s professional services to the State while the payments to the senior counsel were made by me for and on behalf of Governor Udom Emmanuel, at his request and in expectation of refunds at a future date.

“The EFCC tried very hard to link the payments to the senior counsel to the AKSG payments-on- account to PUC but I told them that, at each time when the inflows from AKSG came into PUC’s account, the Firm had available funds in its Access Bank account of not less than N450m (made up, amongst others, of a standing overdraft from Access Bank) and that the fresh funds always comingled with the existing available funds and it was practically impossible to separate them by source and attribute subsequent expenditures to specific preceding inflows or available funds. They wanted to know why these payments to senior counsel were made after each of the 3 inflows into the Firm’s account and not prior and I explained that the Firm retained the unquestionable discretion as to when it pays its creditors and that, in any case, if the payments were made before the AKSG inflows, the same EFCC would’ve been questioning me as to whether those AKSG inflows were made to fill the hole in our account sequel to the senior counsel outflows. Such line of questioning, I stressed, was futile, speculative, tendentious, untenable, baseless, incorrect and unrewarding apart from being utterly unfair to me and PUC.

I wondered aloud in my Statement why, if they thought a pattern was established of payments to senior counsel after each AKSG inflow, how come there was no such payment sequel to the N40,000,000.00 inflow from the State on 18 September 2016 and why I’m not questioned on this.”
For completeness, I have attached to this Address, my letter of 05 June 2018 to the EFCC in which I detailed the 19 arbitral and litigation matters that we had handled for AKSG at all times material to their investigation and the payments to my Firm.

Now, the investigation of the professional fees that were paid to my Firm or through us to some other counsel has very serious and far-reaching implications for all of us and the practice of our profession which we, as lawyers and as an association of lawyers, should not ignore. I would highlight below some of such non-exhaustive implications:
(a) Client-Lawyer Privilege. It has judicially and historically been acknowledged that issues of fees, as between a lawyer and his client, is a matter of privilege.

The recent decision of the Court of Appeal that was delivered on 14 June 2017 in Appeal Number CA/A/202/2015: Central Bank of Nigeria v Registered Trustees of the Nigerian Bar Association & Attorney General of the Federation affirmed this position. By questioning lawyers on the legitimate fees that they have earned from clients, the EFCC is breaching the lawyer-client privilege and showing complete disregard for the judgments of the Courts in this regard.

(b) EFCC’s lack of Locus Standi in Client-Lawyer Contractual Relationship. The fees that are paid by a Client to his lawyer is not only a matter of privilege but is also contractual. As we all know, non-parties to a contract are complete strangers thereto and

lack the locus standi to question and/or determine the propriety of such contract(s). The EFCC stands in that position in this and other matters of this nature; it lacks the locus standi to question the basis for the fees. Only the parties to the contract can question the justification for the fees and in this instance, neither party has raised any such query. Indeed, neither party reported this matter to the EFCC or invited the Agency to carry out any investigation in regard thereto.

(c) EFCC as Auditor and/or Regulator of Legal Fees. There is no provision in Nigeria’s statute books that constitutes the EFCC into the auditor of legal fees. When the EFCC arrogates to itself the right to determine the basis for a lawyer’s fees, it not only intrudes into a client-lawyer contract which by its nature is privileged, but also constitutes itself into an auditor of lawyers’ fees. No such position has been created in our statute books for the EFCC or any other agency for that matter. The EFCC is also not set up as the regulator of lawyers and their fees and it ought not assume such a position.

(d) Criminalization of Lawyers’ Fees. The EFCC appears to be straining quite hard to criminalize the fees that are earned by lawyers for their legitimate work. Mine is not the first of these intrusions; we all recall the case of Chief Mike Ozekhome, SAN when the EFCC attempted to forfeit his fees on the pretext that the funds came from illegal sources. The allegations of the EFCC against me are not any different, particularly in regard to the N300,000,000.00 which was paid by Governor Udom Emmanuel to my Firm’s account for the benefit of his Counsel in the Election Petition Appeal. If these EFCC incursions are not checked, the Bar and the practice of our profession are doomed.

(e) Independence of Legal Profession and Practice. The practice of law, as we all know, is founded on the independence of the legal practitioner and his courage to advocate on behalf of his client to the best of his ability and conviction. That independence and the courage of the advocate are now being threatened and trampled upon by the EFCC. Lawyers now have to work and walk on tip-toe, looking over their shoulders to determine whether the EFCC would be coming after them solely on account of their courage and independence in advocacy.

That does not bode well for the profession or for legal practice generally. My case is not isolated; I have received incessant reports from lawyers who represent clients against the EFCC whose bank accounts and legitimate fees have been and are being investigated by the EFCC sequel to their representations of those clients – not any different from my case. Democracy and the rule of law are threatened when the lawyers’ independence and courage in advocacy are fettered howsoever,whether by the EFCC or any other person or organization, consequent upon the lawyers’ choice of clients.
I will say no more, for now, on this matter.

Conclusion

We cannot and do not intend to roll out all our blueprint for the succeeding months in this Welcome Address. The issues that we raise in this Address are merely illustrative of the areas we would focus on in the succeeding quarters of 2018/2019 and beyond and we would keep you, our dear NEC members, constantly informed and updated on the progress thereon.
It remains for me to thank all our members for the enormous goodwill and support that we enjoy. We, the National Officers, are nothing without you. We must however remain steadfast and focused in warding off evil attacks on our profession and the rule of law. We must remain united and resolute in that fight knowing and understanding that a mischievous and mala fide attack on one of us is an attack on all of us and that is what the EFCC attack on me clearly exemplifies.

As the President, I must also thank all my National Officers for the faith and trust they have in me and, more importantly, the support they have given and continue to give me. The successes we have achieved are joint successes and I merely lead from the front with your support and cooperation. I thank you all for the belief, hope and trust you repose in me and I assure you and indeed our members that I shall neither betray nor disappoint.

Once again, I thank you all, my dear NEC Members for the privilege of serving you as the NBA President. Long live the Federal Republic of Nigeria. Long live the Nigerian Bar Association.

Paul Usoro, SAN President

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