Former First Bank staff accuses Nigerian businessman Oba Otudeko of fraud

Omokolade Ajayi -

Key Points

  • Former FBN Holdings employee Adesuwa Ezenwa sues Oba Otudeko for fraud, claiming $7.6 million loan misappropriation and wrongful termination.
  • Supreme Court mandates Otudeko to repay over $17 million debt; allegations of asset transfers via Barbican Capital to avoid repayment persist.
  • FBN Holdings and CBN seek dismissal of Barbican Capital’s lawsuit, questioning the legitimacy of its 15.1% stake in FBN Holdings.

In a new twist to the ongoing legal saga involving Nigerian businessman Oba Otudeko, a former employee of First Bank of Nigeria Holdings Plc (FBN Holdings Plc), Adesuwa Ezenwa, has filed a lawsuit accusing Otudeko of fraud during his tenure as chairman of FBN Holdings Plc.

This lawsuit further complicates the ongoing controversies surrounding Otudeko, who remains one of Nigeria’s wealthiest individuals and founder of Honeywell Group. Ezenwa, who served as a relationship manager at FBN Holdings from May 2002 until her dismissal in 2016, claims she was wrongfully terminated after being implicated in a scandal involving unsecured loans. 

Ezenwa claims that she oversaw the disbursement of N12 billion ($7.6 million) in loans to firms tied to Otudeko. She alleges these funds, intended for Stallion Group, were rerouted to V-TECH LTD and Ontario Oil and Gas. Ezenwa is suing for N500 million ($320,000) in damages and N25 million ($15,600) in legal fees, asserting that her dismissal was unfair due to her limited loan approval authority.

Supreme court backs debt repayment

The accusations come on the heels of several financial disputes involving Otudeko. In 2021, Otudeko was ousted as the largest shareholder and chairman of FBN Holdings. In July 2023, Ecobank Transnational Incorporated (Ecobank) took action to seize his shares in FBN Holdings due to an outstanding debt of over N13.5 billion ($17.1 million).

Despite disputes, the Supreme Court has upheld the ruling requiring Otudeko and his affiliated companies to repay the debt. Recent allegations suggest that Otudeko attempted to evade debt repayment by transferring assets through a special-purpose vehicle, Barbican Capital Limited. 

According to a letter from Ecobank’s legal representative, Kunle Ogunba and Associates, Otudeko used Barbican Capital to acquire 4,770,269,843 shares of FBN Holdings from various institutional shareholders. These shares were later moved to multiple proxy accounts, a move Ecobank claims was designed to obscure his financial obligations.

FBN Holdings seeks lawsuit dismissal

In a related development, FBN Holdings and the Central Bank of Nigeria (CBN) have requested a Federal High Court in Lagos to dismiss a lawsuit filed by Barbican Capital Ltd.

The investment firm, linked to Honeywell Group Limited, has challenged the legitimacy of its 15.1 percent stake in FBN Holdings, which it asserts was accurately recorded by FBN Holdings’ registrars and the Central Securities Clearing System (CSCS). The dispute over these shares continues to draw scrutiny as both parties await further court decisions.

The unfolding legal drama highlights the deepening financial and legal troubles facing Otudeko, a figure celebrated as one of Nigeria’s leading businessmen. The outcome of these cases could have significant implications for both his fortunes and the broader Nigerian financial landscape.