Deported Again

 

By Tony Orilade /Abuja

 

Chairman of the Economic and Financial Crimes Commission, EFCC, Mrs. Farida Waziri, described them as incorrigible. For the kind of notoriety in alleged sabotage of the Nigerian economy that the Vaswani brothers - Sunil, Haresh and Mahesh - have acquired over the past decade, the conclusion that they are beyond redemption is not out of place. Last week, the federal government flashed the Indians, owners of both the Stallion Group, importers of rice and other edibles, and the Honda Place, merchants in brand new Honda vehicles, the red card for a new round of financial crimes, mainly evading payment of taxes and customs/ports duties.

 

A new round because only six years ago, in May 2003, the brothers were deported by the Olusegun Obasanjo administration for similar offences; they were only pardoned by the incumbent Umar Yar’Adua government in 2007. This time, Waziri and John Udeh, Comptroller-General of Immigration, told journalists last Monday, the deportation of the Vaswanis is for good. Udeh promised the Immigration Service’s commitment to ensuring that the Vaswani brothers do not re-enter Nigeria under assumed identities or pseudonyms. Their deportation order had been signed, but it is not likely it would ever be served on them. For some time, especially since the beginning of this year when words filtered out that the EFCC had begun probing the businessmen and their companies for duty evasion, they have been scarce in Nigeria and have been seen largely shuttling between Dubai in the United Arab Emirate and London. The order, dated 9 April, 2009, signed by the Minister of the Interior, Major-General Godwin Abbe (retd.) and consented to by President Yar’Adua, now formally shuts them out.

 However, 28 other officials of the Stallion group the EFCC indicted along with the Vaswani brothers have been deported, seven of them in the early hours of Monday 20 April. Twenty one had been deported 72 hours earlier. Unlike their Indian bosses that are barred permanently from residing in Nigeria, the 28 officials are banned for a period of five years only. The Vaswanis’ alleged offences of criminal conspiracy and fraudulent evasion of duty are punishable under section 164(a) and (b) of Customs and Excise Management Act CAP C45 Laws of the Federation of Nigeria 2004. Waziri said the men also abused the country’s tax evasion laws and the Money Laundering Provision Act 2004. The anti-corruption agency has sworn to punish certain indicted directors of the Stallion Group and some Customs officers believed to have connived with them to commit the offences.

The EFCC was able to nail the Vaswanis after the suspects it arrested made valuable statements. From findings from its own investigations on nine vessels that the Vaswanis used to import rice into Nigeria, the Commission was able to establish a case of financial malfeasance. The vessels are MV Golden, MV Luckyfield, MV Goldmar, MV Tomi, MV Glory Sanye, MV Thor Alliance, MV Almasi, MV Rama and MV Gora. The first three vessels – MV Golden, MV Luckyfield and MV Goldmar - were alleged to be involved in evasion of duty through manipulation of documents.

MV Golden was discovered to be still loading in Thailand as at 30 August 2008 and expected to depart on 21 September 2008, with its estimated time of arrival in Lagos and Port Harcourt given as 7 October 2008 and 30 October 2008 respectively. Notwithstanding the dates given above, all the accompanying documents including cargo manifest, ship’s inward report, cargo stowage plan, bill of laden, crew list, port of call list and summary of discrepancies were stamped and signed by the officer-in-charge, Report Seat of the Nigerian Customs Service, Area 1, Port Harcourt on 26 September 2008. Apparently, the documents had already been signed when the vessel was still in Thailand.

MV Luckyfield was expected to depart Thailand on 20 September 2008 with its estimated time of arrival in Lagos and Port Harcourt given as 31 September 2008 and 25 October 2008 respectively. But curiously, all the accompanying documents had been stamped and signed on 26 September 2008, six days after its expected time of departure from Thailand and when the vessel was still on the high seas before arriving Nigerian territorial water. The vessel subsequently arrived on 9 November 2008 after the expiration of the waiver period (7 May to 31 October 2008).

MV Goldmar, which by 30 July 2008 was still loading in Thailand, was expected to arrive in Lagos and Port Harcourt on 29 September 2008 and 12 October 2008 respectively. The vessel arrived on 8 November, 2008, after the expiration of the waiver period. Strangely again, all the accompanying documents had been stamped and signed on 26 September 2008 by the officer- in-charge, Report Seat of Customs, Area 1, Port Harcourt, two weeks before estimated time of arrival of the vessel in Port Harcourt. It was easy for the EFCC to infer from the example of these three vessels that the papers were processed at the Port Harcourt port days before the estimated time of departure from Thailand or the estimated time of arrival of the vessels in Nigeria. This, it said, is a clear case of “front loading”, which was done apparently to evade duty on the consignment of rice, using the federal government’s duty waiver (9 May to 31 October 2008) on rice importation, as cover.

Two other vessels - MV Tolmi and MV Sanye - which also arrived in Nigeria with imported rice and were rightfully recorded as arriving after the waiver period, were involved in a dispute over the price of rice in the international market with which the import duty was calculated by the Customs. While the importers claimed that it was expected to be $450.00 per ton of parboiled rice, the Customs Service insisted on $850.00. The vessels were only allowed to discharge at the Apapa Port after the importers issued bank guarantees to cover the short fall in the import duty. The EFCC said that in declaring false entries made on the arrival of the vessels to Nigeria to enjoy the waiver on rice importation between 7 May and 31 October 2008, the Vaswanis evaded a total of about N2.5 billion in duty payment.

When the Vaswani brothers were being pardoned and readmitted into Nigeria in 2007, they were understood to have agreed with government that they liaise with the EFCC to pay N4 billion as condition for re-entry. The money was payment of taxes and duties they had evaded. But rather than meet their part of the bargain, they resorted to the judiciary where to date, they have sought and obtained 12 ex-parte motions against various government institutions. Late last year, the EFCC began investigating the Vaswanis over fresh allegations. Consequently, it arrested some staff of the Stallion Group. One Friday, Waziri disclosed, the Vaswanis visited the Commission with a promise to redeem their N4 billion indebtedness the next Monday. By that Monday, they had secured an ex parte injunction which shielded them from honouring their pledge. They were said to have abandoned their staff in EFCC’s custody and the Commission was compelled to release them. It was on the strength of this and the uncovering of fresh crimes against them that the EFCC sought the President’s approval for their deportation.

Waziri fumed: “It’s only in Nigeria that you see a foreigner doing what he chooses to do without recourse to the laws of the land. Can they do this in their own country? As of now, their bank accounts have been sealed off. Aside from the N2.5 billion duty payment evasions which they must pay, the N4 billion outstanding must also be paid by the Vaswanis.” For the Vaswani brothers, it is a decade and half of scandals. And Waziri may be right after all about their incorrigibility. The Vaswani brothers are the second generation of the Vaswanis doing business in Nigeria. The Vaswani patriarch, Sunderdas, arrived in Nigeria in 1954 to start business in textile trading and fish trawling. His eldest son, Sunil, took over the old man’s business in 1983 and expanded into commodities, car franchise, construction and real estate. To have solid platforms to actualise the business shenanigans buzzing in his young head, Sunil registered Connoisseur Investment Limited, CIL; Stallion Nigeria Limited, SNL and The Honda Place, THP. He was later joined by Haresh and Mahesh.

It was CIL that Sunil would first deploy as the battering ram against the Nigerian economy. Interestingly, none of the Vaswanis featured as director/subscriber in the registration papers of CIL (RC No. 178636) at the Corporate Affairs Commission. Registered on 25 November 1991, the company’s operational headquarter address is 270A, Ajose Adeogun Street, Victoria Island, Lagos, the same base from where the Vaswanis operated till their deportation. At registration, rather than the Vaswanis listed as directors, it was one Mrs. Maureen Umunna who was credited with 24,999 shares and another Tajudeen Olalere with only one.

In 1993, Sunil, using CIL, imported 138 containers of artificial plastic resin that would normally attract about 50 per cent import duty. But Sunil would start proving he was a smart crook by completely evading duty payment. It was ingeniously acccomplished. The Indian, on 25 June 1993, simply wrote to the Federal Ministry of Finance that CIL was undertaking importation of the 138 containers on behalf of its sister company, Stallion Nigeria, which he described as a manufacturer of plastic-based auto spare parts. Since auto spare part manufacturers enjoyed some concession from the federal government, Sunil promptly requested for approval of duty-free concession for the consignment in his letter.

The response was incredibly swift. A letter, BD12237/S.134/T3/Vol.11/644A dated the same date as Sunil’s request and signed by one M.L. Sule on behalf of the then Secretary of Finance, Oladere Olashore, (now a traditional ruler) granted the request. How powerful and influential the Vaswanis had become in the corrupt Nigerian system began to manifest in developments arising from this importation. In April 1998, a non-governmental organisation, Society Against Vicious Exploitation, SAVE, informed the Vaswani Brothers that it had written a petition to “all relevant organisations over the importation, clearing and selling of about 138 containers of artificial resins by Connoisseur Investment Limited and Stallion without paying duties, based on the misrepresentation of the Federal Ministry of Finance.” SAVE went further to write the Attorney- General of the Federation to prosecute the two companies.

The Indians, rather than cringe, instructed their lawyers, Bonajo Badejo & Co. what to do. Thus, the solicitors wrote SAVE: “It is a matter for deep regret that you have allowed yourself to be used against law-abiding and responsible corporate citizens doing genuine and honest business in this country…We advise you to withdraw your libelous petitions to avoid a situation where you will be held responsible for any inconvenience or loss the petition may occasion to our clients.” To be sure they would totally emasculate any similar effort as SAVE’s on the matter, the Vaswanis headed for the Federal High Court and obtained an ex-parte injuction against SAVE and all known security agencies to stay all actions against them on the issue. Somehow, the threats of the Vaswanis worked wonders. SAVE and all those behind it disappeared and nothing was ever heard of the matter.

Stallion Nigeria Limited, which the Vaswanis mentioned in its letter to the Finance Ministry as manufacturer of auto spare-parts, was actually registered in 1986 (RC No. 63221) as an importer/distributor of edible commodities. Its directors/subscribers in CAC records are Chief Lawrence Esan Bankole, Mrs. Maureen Umunna, Mrs. Sophia Udom and Sunil Vaswani, each with one share. Like its sister company, Connoisseur, Stallion, at least up till the year 2000, did not file any annual returns.

It was Stallion and THP (The Honda Place) that the Vaswanis had used most extensively to cheat Nigeria. On rice, Stallion imports the Caprice brand from Thailand and India, through a company called Capital Rice. Some say Capital Rice Limited is owned by the Vaswanis. Whatever invoices Capital Rice Limited draws on consignments shipped to Nigeria has always been a matter of dispute between the Vaswanis and the Nigerian Customs Service, which always holds that the Capital Rice figures are far less than what they should be. On virtually every occasion, the Vaswanis would head to the Federal High Court to obtain an ex-parte order to allow them unfettered access to their consignments. And questionably, the judges were always according the Indians their wish. This practice the Vaswanis have consistently employed throught their stay in Nigeria.

THP was registered (RC No. 233540) on 29 October 1993 with a share capital of N500,000 and no Vaswani listed as director/subscriber. The names at CAC, at least until 2000, were Moses Akalaka Ijeih and Oluwemimo Ogunde. These names were absolutely meaningless in THP’s operations; everybody knows the Vaswanis are the all-in-all at the company. In December 1999, a group comprising Toyota Nigeria Limited, Briscoe, SCOA, Leventis and Elizade Nigeria Limited called a press conference to “bring to the attention of the relevant authorities and the public at large, the various activities and sharp practices of unscrupulous characters in the automobile sector of the Nigerian economy.”

The allegation against the Vaswanis was that they were outdoing competitors by undercutting prices. This, their rivals argued, they were able to achieve because they were shortchanging the federal government in payment of Customs duties. The vehicles they were bringing in were also held suspect. Till last week when they were deported, the Vaswanis maintained they were innocent of the allegations against them. Their staff backed them. In a petition to President Yar’Adua appealing that the Vaswanis should not be deported, the staff accused the Indians’ business rivals of being maliciously responsible for the accusations against their employer. Few Nigerians will believe them.

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