A Federal High Court sitting in Lagos on Thursday ordered 20 commercial banks in Nigeria not to honour any withdrawal request from Alhaji Sani Dangote, younger brother of billionaire business man, Aliko Dangote and two of his companies, Dansa Foods Limited and Bulk Pack Services Limited.
The trial judge, Justice Okon Abang, directed that the order is to be in force until September 11, 2014 when all applications filed in a suit brought by Union Bank against Sani Dangote would be heard.
The judge ordered the banks to file affidavit to show cause on the details of his accounts with them within five days.
The banks are Access Bank, CITI Bank, Diamond Bank, Ecobank, Enterprise Bank, Fidelity Bank, First Bank, First City Monument Bank (FCMB), Guaranty Trust Bank (GTB), Heritage Bank, Keystone Bank, Mainstreet Bank, Skye Bank, Stanbic IBTC, Standard Chartered Bank, Sterling Bank, United Bank for Africa (UBA), Unity Bank, Wema Bank and Zenith Bank.
Justice Abang, also ordered Union Bank to file an undertaken to indemnify the defendants in the event that the freezing order ought not to have been made.
Union Bank had sued Dangote and his companies over alleged failure to liquidate about N5 billion debt despite repeated demands.
The bank, in two separate suits against Dangote and his companies, had sought an order of mareva injunction restraining all commercial banks in Nigeria from allowing withdrawal of funds from their accounts pending the determination of the suits.
When the matter came up for hearing on Thursday, the motion could not be heard as the defendants had filed an objection challenging the jurisdiction of the court to entertain the suit.
Out of all the banks, Diamond and Zenith Banks appeared before the court on Thursday and explained that Dangote was equally indebted to them.
Zenith Bank specifically said Dangote was indebted to the bank to the tune of €7 million.
But while stating that he would entertain all the applications filed in the matter on Spetember 11, Justice Abang said there was an urgent need to preserve the rest in view of the allegation that the defendants were about to move the funds abroad.
Union Bank, in the suits, alleged that in a bid to evade payment of the loan, Dangote has been making frantic efforts to deplete the funds in the accounts of his companies, and that investigation had revealed that the defendants had started diverting the funds to Dubai in United Arab Emirates (UAE), Canada and Switzerland.
According to two separate affidavits in support of the suits deposed to by one Olufunmilola Ayoola, an official of the bank, it was alleged that the failure of the defendants to liquidate the monumental debt had negatively affected the Nigerian economy, a development which the bank claimed necessitated the suits.
According to Ayoola, Union Bank was having difficulty in extending credit facilities to small scale businesses which in turn would have helped in boosting the nation’s economy and salvage the country from its present malaise of corruption and under development.
The bank stated that the funds which the younger Dangote and his companies failed to pay, were capable of going a long way in impacting positively on the nation’s economy.
According to the processes, the bank in September 2008, granted the defendants N5.2 billion.
The breakdown of the loan was given as follows; N500 million overdraft, N500 million advert loan, $2.5 million equipment lease, $2.5 million sales and lease back and $30 million import finance.
Ayoola recalled that when the defendants could not fulfill the promise of paying back the credit facilities from time to time, the bank approved the restructuring of the loan, but despite that development, Dansa Foods was indebted to the bank to the tune of N4.003 billion as at November 29, 2012.
The loan was later reduced to N3.477 billion, but that despite repeated demands, the defendants failed to liquidate the debt.
Bulk Pack, on the other hand, is said to be indebted to the bank to the tune of N745.145 million.