A United States investment bank, JPMorgan Chase & Co., was warned by its compliance team over the “great risk” of corruption just days before it made the last of three transfers that totalled $875m to a former Nigerian Minister of Petroleum, Dan Etete.
The internal memo is set to be scrutinised in a London lawsuit brought by the Nigerian government, Bloomberg reported on Friday.
The US bank, according to the international news agency, is accused of ignoring red flags when it transferred funds between 2011 and 2013 from government accounts to Etete, who had been convicted of money laundering.
The report quoted the current Nigerian government as saying a contract awarded by one of its predecessors to explore the deep waters off the Gulf of Guinea was corrupt.
In 1998, a Nigerian offshore oil block, Oil Prospecting Licence 245, was awarded by Etete, to Malabu Oil and Gas, which later sold it to Eni and Shell for about $1.3bn. The deal saw the Nigerian government act as an intermediary between the oil majors and Malabu Oil and Gas, a company allegedly controlled by Etete.
European and Nigerian courts have been raking over the purchase by Eni SpA and Royal Dutch Shell Plc of OPL 245 in the country in 2011.
While the energy giants were recently acquitted of corruption charges in Milan, Italy, in a decision prosecutors could appeal, Nigeria’s government is continuing to seek compensation from JPMorgan.
The memo disclosed at a London court hearing this week shows what JPMorgan managers knew about the oil contract and when, lawyers for the Nigerian government said in court documents, according to Bloomberg.
The government claims Etete distributed the funds received via the bank from the oil majors to corrupt former and serving senior public officials.
The bank has denied any wrongdoing and says its’s being held responsible for not protecting the Nigerian people from their own government.
The government says that by 2013 JPMorgan’s internal concerns over payments to Malabu Oil and Gas were escalating to more senior members of the bank.
“In light of Malabu’s reported connection to the alleged Nigerian corruption scheme, there would be great risk presented if JPMC continues to process wires involving Malabu,” a compliance officer based in the US wrote in a memo dated Aug. 23, 2013.
Just six days later, JPMorgan made a payment of $75.2m to the Malabu account, according to Bloomberg.
Lawyers for the Nigerian government were quoted as saying in court on Wednesday that it wanted to know how the memo was compiled and asked a judge for more emails and documents from the compliance team.
source : punchng
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