A Federal High Court sitting in Kaduna has ordered the temporary forfeiture of N1.37 billion allegedly diverted into a private account under the administration of former Kaduna State Governor, Nasir El-Rufai.
The ruling, delivered by the judge H. Buhari, followed an ex parte application filed by the Independent Corrupt Practices and Other Related Offences Commission (ICPC) on February 14, 2025.
The commission sought the order under various anti-corruption laws, including the Corrupt Practices and Other Related Offences Act 2000, the Advance Fee Fraud and Other Fraud Related Offences Act 2000, and the Proceeds of Crime (Recovery and Management) Act 2022.
The ICPC alleged that the funds were diverted into a private account belonging to INDO KADUNA MARTS JV NIG. LTD and were later recovered into the commission’s recovery account domiciled at the Central Bank of Nigeria (CBN).
The judge also directed that a public notice be published in two national newspapers, inviting any individuals or entities with legitimate claims to the funds to come forward and show cause why the money should not be permanently forfeited to the Federal Government of Nigeria.
The case has been adjourned to April 8, 2025, for a hearing on the final forfeiture.
The ICIR reports that the commission approached a Federal High Court in Kaduna, seeking an interim forfeiture order on the fund, which it said was a proceed from a fraudulent light rail project that the administration failed to execute.
The ICPC had recovered the money into the commission’s recovery account domiciled with the Central Bank of Nigeria in the course of an ongoing investigation into the activities of the officials of the state government during the period.
The exparte motion filed by the commission before the court seeks the court’s nod for the commission to repatriate the fund to the Kaduna State Government.
The ICPC noted that the alleged diversion had deprived the people of Kaduna State of the benefits of the rail transportation system which the money was meant for.
The ICIR reports that the alleged discovery contradicts El-Rufai’s claim that not a dime was stolen under his administration. The former governor had also boasted recently when he appeared on Arise Television for an interview that he led a corruption-free government.
According to documents filed by the ICPC before the court, the Kaduna State Government, under El-Rufai, entered into a joint venture agreement in October 2016 with Indo Kaduna MRTS JV Nig. Ltd to develop a light rail transport system in the state.
At the time the contract was awarded, the company was not registered with the Corporate Affairs Commission (CAC). Despite this, the state government proceeded to transfer over N11 billion into the company’s account at Sterling Bank through multiple transactions between December 23, 2016, and January 17, 2017.
The ICIR reports that awarding a contract to an unregistered company is a serious violation of Nigerian law.
Section 814 of the Companies and Allied Matters Act (CAMA) 2020 mandates the registration of business names with the Corporate Affairs Commission (CAC).
Operating a business without such registration is considered an offence under Section 821 of the same Act. Therefore, making payment into the account of such a company not registered by the CAC contravenes these provisions.
How the alleged fraud unfolded
The ICPC’s investigation revealed that rather than execute the rail project, Jitender Sachdeva, the president of Indo Kaduna MRTS JV Nig. Ltd., also the Indian representative of Skipper Nigeria Limited, allegedly instructed Sterling Bank to place the funds in a fixed deposit account.
Over time, the fixed deposit yielded an interest of N326.8 million, increasing the total sum under scrutiny to N11.37 billion.
The interest on the fixed deposit was said to have been diverted to different accounts of Skipper Nigeria Limited domiciled with Sterling Bank Nigeria Limited.
Further investigations showed that in 2019, N10 billion was refunded to the Kaduna State Government following concerns about the project’s execution.
However, the ICPC found that a balance of N1.04 billion remained unaccounted for. This remaining amount, according to the commission, was funnelled into the accounts of GTA Engineering Nigeria Ltd., a subsidiary of Skipper Nigeria Ltd., under “payment for feasibility study” for the light rail project.
The ICPC said there was no evidence that any such study was conducted.
Relying on the Proceeds of Crime (Recovery and Management) Act (2022), and the Advance Fee Fraud and Other Fraud-Related Offences Act (2006) and Nigerian Constitution, ICPC asked the court to grant an interim forfeiture order on the funds.
The commission argued that the money represented illicit proceeds derived from a contract that was never executed and the fund should be forfeited to the Federal Government in public interest.
In addition to the forfeiture request, the ICPC also sought an order compelling the publication of the court proceedings in two national newspapers.
This would allow any interested parties such as the Kaduna State Government or companies involved in the transaction to contest the forfeiture request and provide justification for why the funds should not be permanently confiscated.
Controversial light rail project
The Kaduna light rail project was initially presented as a major infrastructure initiative designed to modernise the state’s transport system and ease movement of residents.
However, the project was abandoned, despite the billions of naira allocated to it.
The legal battle over the N1.37 billion comes amid broader scrutiny of Kaduna State’s finances. The state is grappling with allegations of mismanagement under the former governor, particularly concerning massive debts allegedly incurred by his administration.
El-Rufai was accused by his successor, Uba Sani, of leaving Kaduna in a dire financial state with billions in liabilities.
Sani said he could not pay salaries and further lamented that El-Rufai left a “huge debt burden of $587m, N85bn, and 115 contractual liabilities” for his government.
El-Rufai’ defence
Former members of the Kaduna State Executive Council (2015–2023) including El-Rufai, however, denied corruption allegations in the Light Rail Project and insisted that all payments made for the project followed due process.
They explained that the rail project was part of the El-Rufai administration’s infrastructural development agenda and was designed as a Public-Private Partnership (PPP), with an Indian firm, Skipper, securing the contract after a competitive bidding process.
The project was to be funded through a $600–700 million loan from the Indian EXIM Bank, with Kaduna State providing a 15 per cent equity contribution.
According to the statement they issued as their defence, the state government engaged a French consultancy firm, Systra, alongside GTA Engineering, to conduct a feasibility study, which cost $2.8 million (about N890 million). The officials said the study was necessary to secure the loan, and its findings led to an in-principle approval from the Indian EXIM Bank in 2017.
They further noted that the state had made a down payment of N12 billion as part of its equity contribution but later recalled the funds when it became clear that the project could not be executed. They argued that all refunds were made except for the N890 million feasibility study cost.
According to them, the feasibility study remains the property of the Kaduna State Government. They also said a forensic audit was conducted to verify the refunds.
They accused the ICPC of shifting its allegations “after initially claiming that N13 billion was missing.”
They further accused the commission of pressuring Sterling Bank to deposit N1.3 billion into an escrow account with the Central Bank of Nigeria (CBN), which they said comprised the feasibility study cost and accrued interest. They posited that the forfeiture process initiated by the ICPC was unjustified and politically motivated.
Reacting to the ICPC’s claim that the funds were deposited into an unregistered company’s account, the former officials admitted there was a delay in incorporating the joint venture company but maintained that no laws were broken.
They insisted that the project was handled transparently and that the feasibility study and related documents remained state assets that could be used whenever the project is revived.
Nurudeen Akewushola is an investigative reporter and fact-checker with The ICIR. He believes courageous in-depth investigative reporting is the key to social justice, accountability and good governance in society. You can reach him via nyahaya@icirnigeria.org and @NurudeenAkewus1 on Twitter.