For over two years, several small and medium-sized Nigerian businesses have been fighting a silent but protracted legal battle with telecommunications giant, MTN.
Two weeks ago, the Economic and Financial Crimes Commission stepped in.
The EFCC invited MTN’s Chairman, Dr. Pascal Dozie, and four other directors of the company for questioning in Abuja, on allegations bothering on fraud, as contained in statements by parties to a contract deal to the anti-graft agency.
MTN, according to the contractor, is owing it and 56 other Nigerian sub-contractors over N1 billion since 2010.
The four MTN directors quizzed alongside Dozie were Gbenga Oyebode, Tunde Folawiyo, Ahmad Faroukh and Colonel Sani Bello.
Fraudulent act alleged
The saga started in March 2010. A Site Integrated Management Service contract, which MTN signed with PNN, a Nigerian-owned communications and power sector consulting group, ended on a sour note.
PNN, according to the contract, was to maintain designated MTN tower locations throughout the country.
PNN is alleging that some members of staff of the MTN attempted to extort money from the company for services rendered under the SIMS agreement.
But when the company refused to yield to the advances of the MTN staff, they allegedly stalled payment for the contract that was already being executed, thus denying PNN and its 56 suppliers their entitlements.
Though it was learnt that the top hierarchy of MTN claimed not to know about the attempt to extort money from PNN, it was learnt from a top official of the telecommunications giant that an investigation has been launched into the matter to ascertain if staff of the company demanded for a bribe from the contractor.
A legal tussle
But when it was taking too long to resolve the face-off, the contractor sought legal intervention.
MTN, according to the contractor, is owing it over N1 billion in unpaid fees for services rendered.
In 2011, the matter was taken before a legal arbitrator chosen by MTN.
The arbitrator awarded PNN N908,638,004.64, whuch was the bill as at then.
Yet, the South African company refused to pay.
From the statement to the EFCC last month by the contractor, the interest on the debt has continued to grow.
MTN was accused by the contractor of filing “approbations and reprobations to ensure the case was speedily resolved and ostensibly force PNN to settle for a lesser amount in desperation.”
PNN said its position has been further worsened by false information made available to its suppliers that it had been paid by MTN.
This, the company said, has resulted “in angry backlash from the small business owners who have suffered tremendously from the considerable loss of income for over two years.”
PNN said for the services it rendered and for which it is demanding a payment of just over N1 billion, MTN has netted over N108 billion in profit.
Arrest of PNN’s chairman by EFCC
In March 2012, the Group Managing Director of PNN, Alhaji AbdulRahman Abiola-Odunowo, was arrested by the EFCC.
The arrest of Abiola-Odunowo was based on petitions to the commission by a disgruntled supplier of the company that PNN was unjusitfiably holding on to its money.
With firm evidence that PNN has been unable to collect its own debt from the South African telecommunications giant, despite legal intervention, Abiola-Odunowo was released.
Based on this evidence and the statement written by Abiola-Odunowo, EFCC beamed the searchlight on MTN.
MTN offers 50 per cent settlement
With the commencement of investigation by the EFCC, it was learnt that MTN has since attempted to settle accounts with PNN.
It offered N600 million, representing about 50 per cent of what it owes PNN.
But PNN has rejected the offer, insisting that the company and its suppliers must be paid in full.
In a statement on March 9, 2012, PNN’s solicitors described MTN’s actions as “economic sabotage” and said that the families of the men and women who have remained unpaid for two years have been gravely and irredeemably affected by the action of the telecommunications giant.
PNN said it remains hopeful that with the renewed vigour of the EFCC under the leadership of its Chairman, Mr. Ibrahim Lamorde, the company and its 56 contractors owed by MTN will get justice and see an end to a prolonged struggle to get what was described as “their fair due.”
More coming. Watch out for details of the statements of all parties to the EFCC and the legal arbitrator.