Between May 14 and 15, 2018, Lagos State Government’s tax contractor, Alpha-Beta, transferred N1.75bn to Ocean Trust Ltd in three transactions of unclear origin, Peoples Gazette reported as its ongoing examination of Lagos finances throws up yet another suspicious handling of public funds.
The money was part of at least N3.8bn that went to Ocean Trust in seven transactions in January and May 2018 for services that neither Alpha-Beta nor the beneficiary could yet explain, the Gazette found as the first media outlet to obtain the company’s bank statement.
On Monday, the Gazette exposed how Alpha-Beta received from and transferred large transactions worth billions of naira to businesses linked to an Internet fraud syndicate.
The Gazette was unable to trace Ocean Trust to any physical address in Nigeria, but its CAC filings showed it was registered in 2001 and operated by political and business associates of Omobola Tinubu, who governed Lagos between May 1999 and May 2007 and now seeks the presidency in 2023.
Ocean Trust’s registered office address in the CAC filings was 684, Idowu Taylor Street, Victoria Island, Lagos.
The address, also known as Freedom House, has been known as Mr Tinubu‘s administrative office, housing several organisations and media offices owned by him.
CAC filings showed Yemi Adefarakan once held majority shares of 4.6 million in Ocean Trust.
Mr Adefarakan now holds the position of executive director and group financial officer of Continental Broadcasting Service, owners of TVC News and other related media subsidiaries in Lagos and Abuja.
Adefarakan is also a director at Primero, operators of Lagos metro services BRT.
Primero is led by Fola Tinubu, a cousin of the former Lagos governor and ruling party chief.
Also on the registration filings of Ocean Trust was Frank Obi, group executive director of Paragon Holdings.
Paragon built Ikeja City Mall, Circle Mall, Oshodi LAWMA Complex, Simpson LAWMA Complex and once held a 20 per cent stake in Ikeja City Mall.
Mr Obi, who is also a non-executive director at Primero, had two million shares in Ocean Trust.
Kehinde Durosinmi-Etti, head of Lagos State Security Trust Fund, was also on Ocean Trust CAC document obtained by the Gazette with 2.4 million shares, alongside a former senator, Jonathan Zwingina, who had 2.5 million shares.
Wema Bank account opening package obtained by the Gazette showed Mr Adefarakan was a signatory to Ocean Trust’s financial activities.
Messrs Adefarakan and Obi used the same address in the account opening documents: 19A, Abagbon Close, Victoria Island.
A spokesperson for Wema Bank did not immediately return a request seeking comments about whether the financial institution conducted a physical inspection of Ocean Trust’s address when it updated the firm’s know-your-customer diligence in 2016.
Messrs Obi and Zwingina declined multiple requests seeking comments from the Gazette about their ties to Ocean Trust.
Mr Durosinmi-Etti, a former CEO of Skye Bank, initially denied any ties to Ocean Trust, saying he had never heard of the firm.
But when the Gazette showed him the CAC documents that confirmed he was involved, the security fund manager said his memory of the business had become fuzzy.
Mr Adefarakan also initially denied links to Ocean Trust but when reminded that he ran the firm with Mr Obi and others and the 2018 transfers from Alpha-Beta, he warned the Gazette not to proceed with our story.
Mr Adefarakan said the bank documents were “classified,” warning in Yoruba that “e ma ba nkan je oh,” i.e.: publishing the documents could trigger chaos within their circles.
Although its CAC filings showed involvement of members of Lagos political and business elite, Ocean Trust had no known physical address.
The Gazette tracked Ocean Trust to Freedom House and other addresses in Lagos but no one admitted familiarity with the name.
Yet, Alpha-Beta moved billions to the apparent shell company presumably from its opaque and questionable earnings from successive Lagos governments since Tinubu.
On January 12, 2018, Alpha-Beta transferred N800m to Ocean Trust.
Barely a few days later, the company also received N750m on January 15 and another N450m on January 16.
Ocean Trust again received N750m from Alpha-Beta on May 14, 2018.
The next day on May 15, the firm received N1bn in two tranches of N550m and N450m from the tax contractor, documents showed.
On May 17, N50m went to Ocean Trust from Alpha-Beta.
All the transactions, totalling N3.8bn in the reviewed period, were vaguely described as ‘outflow’, making it difficult to understand their purpose.
Afolabi Aremu, chief account executive at Alpha-Beta, suggested the transactions were legitimate, but failed to elaborate on the company’s business with Ocean Trust to the Gazette.
Our findings came as Mr Tinubu and Alpha-Beta were striving to extricate themselves from money laundering charges raised against them by Dapo Apara, a former CEO of Alpha-Beta, who said Mr Tinubu controls Alpha-Beta as a conduit for siphoning Lagos funds to service his political and business structures.
In separate statements, Mr Tinubu and Alpha-Beta denied allegations of corruption, but neither denied Mr Apara’s claim about Tinubu’s control of Alpha-Beta.
Last month, Tinubu confirmed ownership of TVC and The Nation newspapers, yet neither he nor any member of his family reflected in the CAC documents of both companies.
The former Lagos governor effectively admitted using proxies to hold commercial interests across multiple companies.
Alpha-Beta’s enduring status as Lagos government’s main tax consultant has generated keen interest of taxpayers and criticism of political opposition.
In 2012, Lagos PDP chief Adegbola Dominic filed an FoI seeking disclosures of Lagos government’s businesses with Alpha-Beta, but he was turned down on the basis of FoI’s irrelevance in Lagos as a federal law.
Alpha-Beta continued its business with Lagos unchecked, receiving an irrevocable order to take from Lagos monthly federal allocations.
The company’s bank statements are being published for the first time since it became the preeminent tax consultant for the richest state in the country, and they reflected vast transfers to business and political associates of Tinubu.
Tinubu was the governor when Alpha-Beta, founded by Apara, became Lagos’s main tax collectors.
There were claims that the government was paying Alpha-Beta some commissions for confirmed tax receipts, but the company’s bank accounts published on Monday by the Gazette reflected other transactions that appeared to show a fixed monthly revenue from Lagos coffers.
Apara said in court filings that most of the transactions from Alpha-Beta were transferred to other entities linked to Tinubu in a manner that suggested money laundering.
Tinubu and Alpha-Beta denied the allegations.
Still, both Alpha-Beta and Lagos authorities have continued to deny the Gazette requests for them to clarify some of the suspicious transactions in the bank documents.