LG funds: Again, govs fail to stop NFIU guidelines in court
The 36 state governors have again failed in their bid to stop the implementation of guidelines issued by the Nigerian Financial Intelligence Unit (NFIU), directing banks not to allow transactions in States/Local Government Joint Accounts.
The NFIU guidelines rather directed that such accounts should only be used to distribute allocations to accounts of local governments directly.
However, the governors, under the auspices of the Nigeria Governors Forum (NGF), filed a suit against the NFIU challenging the legality of the guidelines.
In the suit marked FHC/ABJ/CS/563/19, before the Abuja division of the Federal High Court, the aggrieved governors had urged the court to quash the guidelines and declared it null and void.
But Justice John Tsoho, in his ruling on an interlocutory application moved by the applicants on Monday, declined to restrain NFIU from implementing the guidelines pending the determination of the suit.
Justice Tsoho ruled that since the matter is a constitutional issue, he would not ”bother with interlocutory injunctions.”
Meanwhile, following the absence of the lead counsel to the NGF, Prince Lateef Fagbemi (SAN), in court, proceedings were stalled.
Fagbemi was said to be at the Presidential Election Petitions Tribunal, sitting at the Abuja division of the Court of Appeal.
Although he had initially applied for a stand down to 11:30 am to enable him to come and argue on the matter and was obliged, he still could not attend court.
Consequently, lead counsel to the NGF, Arthur Obi-Okafor (SAN) informed the court that they ”had shown good faith by waiting for the plaintiff’s counsel till 11:30am and there was no guarantee he would be through at the Court of Appeal if the matter was stood down for another 30 minutes”.
He also informed the court that they were already challenging the jurisdiction of the court to hear the matter which has been served on all the parties.
The lawyer holding brief for Mr Fagbemi (SAN), for the plaintiffs, while not opposing an adjournment urged the court to restrain the NFIU from proceeding with the enforcement of the guidelines but the court declined to grant the request.
The court thereafter, adjourned the matter to October 23, 2019, to hear all pending applications
The NFIU had on May 6, 2019 issued ‘Guidelines to Reduce Vulnerabilities Created by Cash Withdrawals from Local Government Funds throughout Nigeria,’ which stopped governors from tampering with funds meant for local government areas.
The guidelines took effect from June 1, 2019.