Oil Marketer Sues Zenith Bank, Alleges N6.4B Illegal Charges



By Gbenga Ogunbufunmi

An independent oil marketer, Mr. Olusola Anthony Adejugbe and his company, Tonique Oil Services Limited, have instituted a N6, 441, 369, 617.73 billion suit against Zenith Bank Plc, before a Federal High Court, Lagos, over what they described as excessive and illegal charges.

Meanwhile, the matter has been fixed for April 4 and 5 before Justice Ayotunde Faji.

Adejugbe in his amended statement of claim filed before the court by his lawyer, Mr. Lanre Ogunlesi (SAN), stated that in the course of his business activities his company, Tonique Oil Services Limited obtained several credit facilities from Zenith Bank PLC while he pledged three of his properties as securities for the loan facilities.

The plaintiff averred that three different transactions leadings to this litigation occurred in the company’s current account whereby excess interest and charges were discovered. Consequently, the company demanded for a reversal, but the bank has refused.

Adejugbe also avered that a forensic accounting firm was engaged to scrutinise and analyse his company’s account with Zenith Bank and it was discovered that between August 2006 and December 2013, excess interest and charges on the company account by Zenith Bank as accumulated to N1, 842, 471, 801. 99.

Giving the history of transactions that led to the dispute, the plaintiff stated that by a letter dated February 19, 2008, Zenith Bank granted his Company commercial paper facility of N2,568,644,276.09 to finance the purchase of 30,000MT of Petroleum products, but N2,501,270,000 was credited into the company’s account.

He, however, stated that instead of Zenith Bank financing the purchase of 30,000MT of Petroleum products for the company as per letter of offer the entire sum of N2, 501, 270 billion was diverted by the bank for the purchase of its own shares during the bank’s Initial Public Offer, IPO , a conduct that is unethical, unprofessional and reprehensive.

The plaintiff added that out of the sum of N104,363,212.03 assessed as dividends payable on the bank’s shares only N42,173,498.43 million was credited into the company’s account leaving outstanding balance of N62,169,713.60., adding that the bank’s shares purportedly bought by his Company with the facilities granted by Zenith Bank were managed by the bank so much that the bank eventually liquidated the shares after the value has nose-dived and depreciated.

Adejugbe also stated that another activity on his Company’s current account with the bank was the sale and purchase of a property in Port Harcourt that belong to one of the shareholders/customers of the bank who needed to clean up some of his obligations to the bank. And that it was the bank who introduce his company to the shareholders 50,000 square metres of land out of which the company bought 20,000 square metres for the purpose of expanding its business earnings.

He averred that to facilitate the purchase of the land, Zenith Bank offered the company a term loan of N500,000 and it was part of understanding of the company and the bank that after the purchase of the land, the bank will finance the company’s Tank Farms to be built thereon.

He said that after the purchase of the land, the bank took possession of the title documents to the land as collateral while it reneged on the promise and understanding to finance his company’s tank farm on the land and since 2008 the land had been under the management of the bank and the same had been lying fallow.

In this circumstance, the plaintiffs contended that Tonique Oil Company is not indebted to the bank and any alleged indebtedness could only have been arisen as a result of the unconciousable and illegal acts of the bank’s officials in debiting the company’s account with astronomical spurious interest charged.

Consequently the plaintiffs also contended that such interest charges are illegal in that they contravene the Central Bank of Nigeria Monetary Credit and Foreign Exchange/Trade guidelines.

The plaintiff said it’s financial consultant computed other charges that were passed into the account of the company, base on relevant policy circulars, guide to bank charges of Central Bank of Nigeria and discovered that the bank excessively overcharged the company on interest on overdraft, COT, and VAT on COT, Management Fees, upcountry transfer fees, interest on commercial paper, foreign exchange purchases and letter of credits.

Consequently, the plaintiffs are contending that they are not indebted to the bank rather the bank has overcharged the plaintiffs to several billions of Naira.

Consequently, the plaintiff urged the court to declare that Zenith Bank being a bank within the supervisions and control of CBN cannot charge interest on any facilities granted to them beyond the official approved policy rate of the Central bank of Nigeria at any given time.

Plaintiff also urged the court not only to restrain Zenith Bank from selling their property pledged as securities for the loan, but to also compel it to pay his company the sum of ₦6, 441, 369, 617.73 billion, being the total excess charges debited into the company’s account by the bank and interest on the same amount at the rate of 21% per annum from the date of judgement of the court until final liquidation.

However, Zenith Bank in its statement of defence with statement on oath sworn to by Senior Assistant Manager Internal Control and Audit Department, Mr Vincent Ohanugo, denied the company’s claim.

The bank in its statement of defence stated that the company was granted several loans which include: ₦2.5 billion regular commercial paper; $36 million import finance facility; $6, 648 million commercial paper/usance facility; $9million import finance facility via usance facility and $11million short term import facility of ₦500 million.

The bank also stated that the plaintiffs authorised Zenith Registrar Plc to take steps to purchase the shares of the bank on its their behalf, while also pledging 3.5million and 17,154,300 units of the shares respectively in favour of the bank and authorised the bank to sell them to recoup part of the credit facilities granted them, adding that the allegation of unethical conduct against the bank lacks competence.

The bank also stated further that there was no understanding entered into with the company to finance the construction of Tank Farm, adding that the plaintiffs assertion that they are no longer indebted to the bank is a bare denial and therefore challenges the plaintiffs to provide evidence of payment of all the credit facilities availed to them by the bank.

Zenith bank also states that the plaintiffs suit does not disclose any cause of actions against the bank as they are still indebted to the bank in the sum of N8, 464, 176, 356.52 as at January 31, 2013, it therefore urged the court to dismiss the suit as been frivolous, vexatious,as it amounts to abuse of the process of the Court.




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