…as ICPC, EFCC finger FCDA, NSCDC officials in FCT real estate scam
…301 houses recovered from civil servants
Speaker, House of Representatives, Femi Gbajabiamila, Thursday, said that Nigeria housing deficit rate was alarming.
He said the deficit is current estimated to be between 17 and 20 million housing units.
According to him, this number was increasing annually by 900,000 units.
Gbajabiamila however said the potential cost of overcoming the deficit was about N6 trillion.
The Speaker made the disclosure at an investigative hearing of the House on corruption in real estate sector where the Independent Corrupt Practices and Other Related Offences Commission, ICPC and the Economic and Financial Crimes Commission, EFCC fingered some officials of government as culprits.
The Chairman, ICPC, Professor Bolaji Owasanonye said that 241 houses were recovered from a public just as another 60 built on a large expance of land were also recovered from another public officer.
The investigation was sequel to a motion on the need to investigate alleged sharp practices of some estate developers in the Federal Capital Territory, FCT, recently passed by the House.
Represented at the hearing by the House Leader, Hon. Alhassan Ado Doguwa, Gbajabiamila bemoaned lack of legal framework to properly monitor the activities of estate developers.
He said: “As you are aware, one of our primary tasks and constitutional responsibilities as elected representatives of the people and of our various constituencies is to, amongst other things, ensure the welfare and prosperity of our people. Access to decent and affordable housing is one of the primary indicators of such economic empowerment.
“With the current housing deficit in Nigeria, which is estimated to be between 17 and 20 million housing units and also said to be increasing annually by 900,000 units, the potential cost of overcoming this deficit is about N6 trillion. This highlights the huge opportunity that exists in the real estate sector.
“However, there are gaps in the relevant legislation that empowers some real estate developers, while they capitalise on this opportunity to also operate with impunity, stealing away the dreams and billions of naira of hard-working Nigerians. A lack of accountability and regulation in the dealings between these real estate developers and home buyers has caused untold hardship to many already struggling Nigerians, who desire to own their own houses. It is our responsibility to introduce effective regulations to resolve these issues.
“I am happy to commend the efforts of the ICPC and EFCC in sanitizing the sector. Hardworking Nigerians should not lose their money to fraudulent developers with no consequence. Nigerians are crying out over these sharp practices, and we cannot turn a deaf ear to their cries.
“That is why I was very happy when Honourable Boma Goodhead brought the motion to the floor on the need to investigate the operations of real estate developers in the Federal Capital Territory.
“The resolutions of this committee will hopefully ameliorate and bring some lasting solutions to the lack of transparency, professionalism and accountability in the real estate sector while introducing legislation to protect home buyers from unfair contracts and other sharp practices highlighted in the sector.”
In his presentation, the ICPC Chairman, Professor Owasanonye said that some public officers were involved in the unwholesome practices.
“Public officers acquire estates in pseudonyms to conceal the illegal origin of funds. This is made possible by the absence of proper documentation, the registration of titles to land and estates in the country and the non-enforcement of beneficial ownership standards. A tour round Abuja especially the metropolis and the central area, would show a lot of estates that are built up but empty. If they had been constructed with funds that were borrowed at market rates, I don’t think any investor would such proprieties empty. One way or the other they would put them to use. So it is suspected that some of those estates have been used to launder ill-gotten public funds.
“The commission has for example a case in which recovered 241 houses houses from a public officer and another one in which we recovered 60 buildings on a large expanse of land from public officer. Corruption in real estate aids illicit financial flows. the real estate sector is globally recognized as attractive to IFF largely because it is partially informal, it is not properly regulated, easily open to abuse, the use of shell companies, the use of intermediaries and third parties to acquire real value with proceeds of crimes or illicit funds.
“I must note that major culprits and criminals, who are frustrating the problems are the staff of the FCDA and their collaborators. The ICPC over the years has partnered with a number of relevant registries to scale down the incidents of corruption in land tenure system by intelligence and information sharing, making available our forensic tools to analyze documents and detention of forged documents and by prosecuting offenders.
“The commission has at various times commended administrative resolution, where FCDA is required to remedy whatever went wrong and to reallocate or to withdraw and allocation depending on what is teh proper justice of the case at the time. This is aside from prosecution of offenders where the infractions are found and breaches of relevant laws are established and in some cases, ill acquired assets are recovered and returned to victims”, he said.
The Chairman also disclosed that the agency made a recovery of N53, 968, 158, 974.64 from some developers who refused to make remittances to the government during their investigation as part of the defunct special presidential investigation panel on recovery of public property in collaboration with the FMBN.
He added that the agency was also in receipt of many petitions from stakeholders in the real estate.
“The defunct special presidential investigation panel on recovery of public property in collaboration with the FMB investigated some real estate developers who defaulted in remittance and payment of money due to government.
“The ICPC continued and completed this exercise and from it recovered a total of N53, 968, 158, 974.64. The figure comprises of part of the money that was paid and handed over in advance, about N858 million fully recovered returned to FBN. One billion naira post dated cheques that are due this month of October and N51 billion plus that were given to promissory notes in advance notarized agreement FMBN. We are happy the the Ministry under the leadership of the current Minister has taken the bull by the horns in introducing a lot of measures. Two years ago he wrote a letter to the ICPC requesting a collaboration to deal with a lot of anomalies that he met on the ground and we responded positively to that request by working with the FCT for improving the situation.
“It is very important that the FCT and the agencies under it must make sure that they reduce the opportunity for their own staff in collaboration with outsiders to clone documents that lead to defrauding of innocent members of the public including honest real estate developers. Because we have a number of cases whereby the original of certificates of occupancy or land title documents are released to fraudsters and criminals temporarily in order to deceive investors and after that deceit is effected, the documents are returned to the file. This cannot happen unless somebody on the inside has colluded. FMBN processes for loan application for estate development should be made unambiguous transparent and less cumbersome.
“They border on forgery, the closing of land documents, double or multiple land allocations, allocation of land without the minister’s approval, revocation of land title without due process, non delivery of projects, embezzlement of sourced capital, land racketeering, the use of land syndicates and speculators, the marketing of fake layouts, fraudulent allocation of land, inordinate delay in processing of land documents for those who subscribe to their projects, general abuse of office, bribery, dishonesty, fraud, payment scams, or the refusal of government itself to pay fair value for acquired land and the concomitant refusal of settlers and traditional owners to give access to legitimate land allotees and other related issues and challenges,” he said.
Owasanonye also pointed accusing fingers to the Real Estate Development Association of Nigeria (REDAN) as shielding the fraudsters.
Similarly, Director of SCUML, Economic and Financial Crime Commission (EFCC), Daniel Isei said that their investigation indicated that most of the developers do not always identify their buyers.
“From our record we have registered over 8000 estate developers, and most of them do not comply with basic standard of identifying and verifying customers,” he said.
Also speaking, the Minister of FCT, Adamu Mohammed expressed hope that the anomalies identified will be taken care of.
“I hope the entire issues raised will give us the clue to deal with the situation; we must look at where we have challenges and so move on to correct it,” he said.
In his remarks, the President of REDAN, Aliyu Wamakko promised to adopt measures to sanitize the system.