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N48.3bn housing fund trapped in 60 mortgage banks, others

NO fewer than 60 mortgage banks and estate firms are indebted to the Federal Mortgage Bank of Nigeria to the tune of N48,304,975,056.9.

The National Housing Fund facility was reportedly diverted or misappropriated by the mortgage banks and private real estate developers which benefited from the initiative.

The loan was granted to the developers for the building of affordable houses for Nigerians, but an investigation carried out by the FMBN and the defunct Special Presidential Investigative Panel on the Recovery of Public Property indicates that many of the firms did not deploy the funds for this purpose.

The probe found that the developers either absconded with the money or completed the projects, sold off the property, yet refused to pay back the loan.

The joint FMBN/SPIP recovery exercise report was submitted to the House of Representatives Ad hoc Committee on the Assessment and Status of all Recovered Loots, Movable and Immovable Assets from 2002-2020 by Agencies of the Federal Government of Nigeria for Effective/Efficient Management and Utilization.

The report obtained by Sunday PUNCH recommended the valuation and takeover of three delinquent firms indebted to the tune of N1,523,826,132.30.

It listed the names of 25 estate developers holding on to N22.5bn, as well as 23 others with N10.8bn debt who agreed to repay their loan through bank transfer or Remita platform.

Six other firms with a N2.8bn debt portfolio agreed to repay their loans by bank draft, cheques, and bank guarantees.

However, the case of three companies indebted to the tune of N6.4bn could not be resolved by the investigators while the N704, 847,320.86 owed by two estate firms was described as unclassified.

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It also listed three companies that reportedly demonstrated ‘’clear criminal intent to defraud the bank.’’

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The report said, ‘’In the course of the exercise, it was observed that developers largely failed to take responsibility for their inability to utilise funds judiciously. Thus, they placed all the blame for their failure (of the facility) on the bank.

“These developers received the huge funds and either absconded with the money or completed the projects, sold off the property and refused to pay back the bank’s money. During the exercise, they failed to appear before the team.’’

The FMBN said they extracted payment commitments from the developers in the sum of N43.7bn spread over 18 months.

Based on this, the investigation team directed that all post-dated cheques received from the debtor be collected and formally forwarded to the FMBN for custody and to be cashed as they attain maturity.

However, the report said the majority of the developers hinged their inability to deliver projects and repay their loans on the staggered or delayed disbursement of funds by FMBN. The developers also claimed that the delay in processing loan applications impacted negatively on the project as the bill of quantities accompanying loan applications was overtaken by inflation.

The developers also blamed cumbersome inter-account settlement requirements and documentation at the end of the transactions, as well as systemic issues such as the slow appraisal of loan applications and long disbursement procedures.

An official in the FMBN corporate affairs department, Ahmed Mohammed, said he had no knowledge of the matter and promised to liaise with the relevant department to provide the status of the repayments.

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