Vanishing Funds: How a Non-Existent Company Walked Away with ₦18 Million at ABU Teaching Hospital

Secrets Reporters

In a shocking revelation that strikes at the heart of public trust, the Ahmadu Bello University Teaching Hospital (ABUTH) in Zaria is under fire for awarding a multimillion-naira contract to a company that, on official record, does not exist.

According to a damning audit report obtained by SecretsReporters, the contract—worth a staggering ₦18,081,920.00 (Eighteen million, eighty-one thousand, nine hundred and twenty naira)—was issued on June 22, 2021, for the supply and installation of equipment/instruments for the hospital’s Urology and Nephrology Centre. However, what should have been a straightforward procurement process has unraveled into a web of administrative negligence, legal breaches, and suspected fraud.

A Ghost in the System

At the centre of this scandal is a mysterious discrepancy: the name of the company stated in the award letter (Ref. No. ABUTH/PROC/041/1) did not match any registered entity on the database of the Corporate Affairs Commission (CAC). Even more bizarre, all critical documents related to the contract—including the letter of acceptance, the contract agreement, and the power of attorney—bore a completely different name, one that has no legal standing under Nigerian law.

Section 16 (6)(b) of the Procurement Act requires that all bidders must have the legal capacity to enter into a contract. Section 863 of CAMA 2020 goes even further, making it a punishable offence for individuals or associations to carry out business activities without proper registration.

Yet, despite these clear legal stipulations, ABUTH’s management awarded and processed this dubious contract without batting an eyelid.

Management’s Silence, Auditor’s Fury

Perhaps more troubling than the procedural breach is the deafening silence from hospital management. According to the audit report, no explanation, no defence, and no attempt at damage control was provided by ABUTH in response to the glaring red flags raised.

As a result, the auditor has deemed the findings valid and enforceable until the hospital implements recommended corrective actions.

A Trail of Risks and a Cry for Accountability

Beyond the legal implications, the audit outlined two major threats; loss of government funds due to payments made to a non-existent entity, and payments for contracts not executed, raising suspicions that the contract may have been a front for siphoning public funds.

In light of these issues, the report directed the hospital’s Chief Medical Director to justify before the National Assembly’s Public Accounts Committees why a contract of over ₦18 million was handed to an unregistered firm.

It also recommended that the full amount should be recovered and remitted to the government treasury, and also provide proof of this remittance to the appropriate legislative committee.

In addition, the audit noted that the Chief Medical Director should face sanctions as provided in the Financial Regulations of 2009 and penalties stipulated in Section 863 of CAMA 2020, if recovery fails.