N2.05bn Customs Audit Bombshell: N1.94bn Taxes Unremitted, N103.5m Legal Fees Questioned Under Hameed Ali

Secrets Reporters

Troubling financial and administrative lapses have been discovered in the Nigeria Customs Service Headquarters in Abuja, amounting to approximately N2.05 billion, after a review of its 2019 overhead accounts by SecretsReporters.

The audit, which identified five separate issues, under the leadership of Col. Hameed Ali, raised concerns about the management of public funds, adherence to financial regulations and the adequacy of internal controls within the Customs Service.

According to the findings, N103.5 million was paid to external solicitors without evidence that the engagements received the approval of the Attorney-General of the Federation, as required under Establishment Circular SGF/PS/CIR/625/1 of July 16, 2003.

Moreover, the Customs Service failed to provide essential documentation to justify the payments, including case breakdowns, receipts, engagement letters and contract agreements. The absence of these records made it difficult to establish the nature and scope of the legal services for which the substantial sum was spent on.

Furthermore, the audit exposed serious issues regarding the manner in which arms and ammunition at the FCT Customs Command were kept and documented. The weapons were reportedly stored in an ordinary room rather than a fortified armoury, while the Command had no properly maintained Arms and Ammunition Register capable of providing a reliable record of new procurements.

There was no evidence of internal checks on the records that were available, raising concerns about the controls surrounding government-owned arms and ammunition.

Also flagged was a payment of N4.68 million for a staff executive-education leadership programme at Harvard Kennedy School. The payment was made through a voucher dated December 24, 2019, for a programme scheduled to take place in March 2020.

However, the Customs Service failed to produce documents capable of confirming that the training actually took place, including a timetable, attendance certificate or photographs. The expenditure violates paragraphs 603(i) and 417 of the Financial Regulations 2009.

The most substantial concern in the audit involved N1,935,981,031.99 allegedly deducted from various contractors as statutory taxes. Despite the deductions, there was no evidence that the money had been remitted to FIRS.

These violates Treasury Circular TRY A1&B1/2017 and paragraphs 234(i) and 235 of the Financial Regulations 2009. The absence of evidence of remittance placed nearly N2 billion in statutory deductions at the centre of the controversy surrounding the Customs Service’s 2019 accounts.

Furthermore, the Customs Service failed to deduct the required one per cent stamp duty from certain contracts. N641,999.74 in stamp duty was not deducted from overhead-cost contracts, while another N3,978,571.68 was not deducted from capital-vote contracts. The combined amount of stamp duty not deducted is N4,620,571.42, violating Treasury Circular TRY A1&B1/2017