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JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times - Politics - Nairaland

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JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by Saifullah01: 9:57am On Apr 05, 2019
JPMorgan’s Role in Nigerian Oil Deal Has Come Back to Haunt It

At the heart of a case against JPMorgan Chase is whether it did enough to safeguard Nigeria’s money.


Under the rule of the Nigerian dictator Sani Abacha more than 20 years ago, a handful of high-ranking government officials looted billions of dollars from the country’s coffers.

Now the Nigerian government is demanding some of its money back — from JPMorgan Chase.

In a British court, lawyers for the country are suing a subsidiary of the largest United States bank, charging that it enabled corrupt former officials to extract nearly $900 million between 2011 and 2013 from a government bank account in London.

JPMorgan says it was following instructions it received from senior Nigerian government officials. The country’s attorney general himself wrote a letter attesting to the legitimacy of the instructions. But the bank has been unable to persuade a British judge to throw out the case, in part because of the unusual circumstances surrounding the money transfers — including the fact that two banks to which JPMorgan wired the money rejected the transfers because of concerns that they might violate money-laundering laws.

At the heart of the case is whether JPMorgan did enough to safeguard Nigeria’s money. Under British law, banks are required to act in their customers’ best interests, even if someone connected to a customer tries to get them to do otherwise. Even as it tried to send money to various recipients, JPMorgan reported to regulators its concerns that it might be transferring funds to a convicted money launderer. It made the transfers anyway.


It is the latest example of a major American bank getting caught up in a foreign corruption scandal. In Malaysia, Goldman Sachs and some former executives have been accused of participating in a multibillion-dollar fraud involving a government investment fund. Unlike those executives, however, no JPMorgan employees have been accused of wrongdoing.

In the London lawsuit, the Nigerian government is seeking damages from JPMorgan of nearly $900 million.


The bank’s decision to do business with Nigeria — a country that is ranked 144th out of 180 countries on Transparency International’s corruption list — involved a calculation of risk.

“A head of state known or alleged to be corrupt is the riskiest type of client, both because of potential civil and criminal liability and because of reputational damage should details of the relationship come out, as they often do when there is a change in power in the relevant country,” said Joshua Kirschenbaum, a former director at the Treasury Department’s anti-money-laundering agency, FinCEN.


A JPMorgan spokesman said it would fight Nigeria’s legal claim, which “is completely without merit.”

The bank has argued in court filings that its agreement with the Nigerian government specified, at the time it was signed, that JPMorgan would follow whatever instructions it received, even if it had reason to believe that the instructions were “not in the best interests” of the account holder.

It also claims that Nigeria has failed to identify specific things it could have done differently, since it reported each suspicious set of instructions to its British regulator.

Aside from the London lawsuit, JPMorgan has not been accused of wrongdoing in connection with the Nigerian affair.


Court papers from the London lawsuit and a related criminal trial underway in Italy provide a detailed record of the alleged scheme. (JPMorgan is not a subject of the criminal trial.)

It began in 1998 when Mr. Abacha, the president at the time, awarded a license to drill oil near the Niger River Delta to Dan Etete, Nigeria’s oil minister. Mr. Etete paid just $2 million for the license, which was expected to generate billions of dollars in revenue.


Mr. Abacha’s successors accused Mr. Etete of corruption and tried to revoke the license. They were unsuccessful. Mr. Etete has denied wrongdoing.


In 2007, though, Mr. Etete was convicted of money laundering in an unrelated case in France, and two oil companies, Royal Dutch Shell and Eni, offered to buy the drilling license. In 2011, they struck a deal to pay the Nigerian government, then led by Goodluck Jonathan, more than $1 billion for the license.

But under the agreement, according to Italian and Dutch prosecutors, most of the money was slated to go to Mr. Etete and Mr. Jonathan’s friends, and not the Nigerian government.

Nigerian officials opened an account at JPMorgan in London, and an Eni subsidiary deposited about $1.1 billion on May 25, 2011. Within days, the Nigerian officials instructed the bank to transfer the money to an account at a Swiss bank, Banca Svizzera Italiana.

When JPMorgan sent the funds, B.S.I. officials sent them right back, telling JPMorgan that they were “not comfortable” with the transfer, citing “compliance reasons.” Emails among B.S.I. employees, published in Italian court filings, show that the Swiss bank suspected that the funds were bound for Mr. Etete.


After B.S.I. rejected the transfer, JPMorgan told British regulators that it, too, harbored concerns about whether the money was headed to Mr. Etete. It was the first of six suspicious activity reports that JPMorgan sent to British regulators in relation to the Nigerian account that summer. While JPMorgan was suspicious, it did not close or freeze Nigeria’s account.

(Swiss authorities in 2016 forced B.S.I. to sell itself or shut down after finding that the bank had helped Malaysian officials illegally siphon money out of the government investment fund 1MDB.)

In July 2011, Nigerian officials requested that JPMorgan transfer the entire $1.1 billion to a Lebanese bank.

By then, a large portion of the funds had been frozen in court.

JPMorgan submitted a letter to a British judge from Nigeria’s attorney general attesting to the legitimacy of the planned Lebanese transfer. The judge released $800 million, but told JPMorgan lawyers he was concerned that “the court was about to become if not a participant in at least an aide to a money-laundering exercise,” according to a court filing.


JPMorgan transferred the $800 million to Lebanon’s Banque Misr Liban. But the Lebanese bank sent the money back, saying it could not accept it without more information about the purpose of the transfer, according to a judge’s ruling in Italy and a London court filing made on behalf of Nigeria’s government.

Raymond Baker, the president of the Washington-based nonprofit advisory group Global Financial Integrity, who has followed the case of Mr. Etete’s oil license, said JPMorgan at that point should have sought a detailed explanation from Nigeria about the purpose of the wire transfers.

“There is a culture of ‘take the money, handle the money,’ regardless of other issues that might come up,” Mr. Baker said.

After the Lebanese bank rejected the money transfer, the Nigerian government asked JPMorgan to send $400 million each to accounts at two Nigerian banks held by Mr. Etete. JPMorgan again flagged the transactions as suspicious to British regulators. The regulator, Britain’s Serious Organised Crime Agency (now called the National Crime Agency), consented to the transfers, although it cautioned that the consent did not mean JPMorgan would be legally off the hook if problems with the transfers later arose, according to London court filings that cite the suspicious-activity reports.


The money transfers went through.

Two years passed, during which the Financial Times and The Economist published reports on the alleged scheme to pocket the oil money. In fall 2012, an investigator for the anti-corruption group Global Witness wrote a letter to JPMorgan’s chief executive, Jamie Dimon, asking questions about the money transfers.

In 2013, acting on another set of instructions from Nigerian government officials, JPMorgan sent the remaining $74 million in the account to one of Mr. Etete’s corporate accounts in Nigeria, according to the London court filing. The JPMorgan account had been set up as a “single purpose” account, established only to handle the money from the drilling-license agreement. Now that it was empty, it ceased to exist.

https://www.nytimes.com/2019/03/28/business/jpmorgan-nigeria.html

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Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by Ventura1: 11:02am On Apr 05, 2019
It can't be the same Gen. Abacha President Buhari said never looted Nigeria money? Never!

48 Likes 2 Shares

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by HeWrites(m): 2:58pm On Apr 05, 2019
.
Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by hensben(m): 2:58pm On Apr 05, 2019
Ghen Ghen
Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by Lexusgs430: 2:58pm On Apr 05, 2019
If you blend beans, you must s.hit moimoi or àkàrà.......

1 Like 1 Share

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by Nobody: 2:58pm On Apr 05, 2019
Summary.
.
.
.In a British court, lawyers for the country are suing a subsidiary of the largest United States bank, charging that it enabled corrupt former officials to extract nearly $900 million between 2011 and 2013 from a government bank account in London.

35 Likes 7 Shares

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by Upton: 2:58pm On Apr 05, 2019
grin
Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by salt1: 2:59pm On Apr 05, 2019
But Abacha wasn't corrupt

3 Likes

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by holuwasheyiWGP(m): 2:59pm On Apr 05, 2019
JPmorgan obviously did they deal because they gained something from it,No one does something that crappy without benefitting from it.
They must pay

18 Likes 3 Shares

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by subtlemee(f): 2:59pm On Apr 05, 2019
After all this where do the recovered looted funds go?

3 Likes

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by DogmaNation: 3:00pm On Apr 05, 2019
grin grin Buhari told his zombies that Abacha was a saint!
The map below show's how fuccked up Buhari is!

19 Likes 1 Share

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by id4sho(m): 3:00pm On Apr 05, 2019
Yam Eaters,
All goats should bring back our yams.
Better English Judge

1 Like 1 Share

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by LeopardX: 3:01pm On Apr 05, 2019
No be even dat one dey do me sef. Na that building wey I dey see dey worry me. Na hin be say if I manage smuggle myself enter US, I go dey get neck problem be that ooo. Chai! Beautiful, Tall, historical and monumental structures. Na wa ooo.

9 Likes

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by Opexzy: 3:01pm On Apr 05, 2019
If you want to eat with the devil, you must have a very long spoon... JPMorgan forgot this... now they will have to pay for it...

5 Likes

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by freemanbubble: 3:02pm On Apr 05, 2019
Okay
Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by chiedu7: 3:02pm On Apr 05, 2019
Wetin dey vex me be say,

The Oil dey Niger Delta .

The people wey dey enjoy am dey North.


Another reason why we ďontb belong in Nigeria.

1 Like

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by Injiggerwolf(m): 3:02pm On Apr 05, 2019
Nawa o
Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by sonnie10: 3:03pm On Apr 05, 2019
What we hear in Nigeria everyday is that Igbos have finished this country

2 Likes

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by GavelSlam: 3:06pm On Apr 05, 2019
I had no shoes.

7 Likes 1 Share

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by Bobbyfreshh(m): 3:07pm On Apr 05, 2019
GOD BLESS SAINT ABACHA AS PORTRAYED SAINT MR INTEGRITY BUHARI

1 Like

Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by Nobody: 3:07pm On Apr 05, 2019
so people stole under Abacha but he never stole I am guessing.
Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by feyisara90: 3:09pm On Apr 05, 2019
Alright na
cheesy




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Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by Bambambiglo: 3:09pm On Apr 05, 2019
I follow one of abachas daughters on Instagram.

Mehn you need to see how this woman is balling. smh
Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by cole150: 3:11pm On Apr 05, 2019
Imagine....whats happening
Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by partrum: 3:14pm On Apr 05, 2019
well that's their business
Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by BruncleZuma: 3:15pm On Apr 05, 2019
Buhari the Buhari
Re: JPMorgan’s Role in Nigerian Oil Deal Has Come Back To Haunt It - New York Times by NaijaFutbol: 3:16pm On Apr 05, 2019
Abacha was not corrupt!

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