The announcement by Nigeria’s former Minister of Finance, Ngozi Okonjo-Iweala, of her two international posts with Global Alliance for Vaccine and Immunization (GAVI) and Lazard has raised conflict of interest concerns. A day ago, Mrs. Okonjo-Iweala disclosed that GAVI had appointed her a board member while the Lazard, a financial advisory and asset management firm, hired her as a “senior advisor.”
In her long career as Nigeria’s Finance Minister, Mrs. Okonjo-Iweala’s actions and policies had financially benefited the two multinational entities that have engaged her, our investigations discovered.
On July 27th, 2015 SaharaReporters broke the news that the Ministry of Health had questioned the propriety and authority of Mrs. Okonjo-Iweala’s decision to remit $2.2 million to GAVI, a major non-governmental organization. The Global Alliance for Vaccine and Immunization (GAVI) had completed a Cash Program Audit (CPA) in 2014, and accused the Ministry of Health and National Primary Healthcare Development Agency (NPHCDA) of misusing $2.2 million meant for vaccinations in Nigeria between 2011 and 2013.
A press statement by GAVI, released on July 30th 2015, stated, “it was agreed in principle by the Minister [of Health] to repay any funds identified as having been misused.” The statement continued: “The CPA [Cash Program Audit] determined that US$2.2 million had been misused.”
GAVI finally disclosed that, pursuant to the agreement between them and the Nigerian government, the multinational organization “has since been fully reimbursed.”
But an independent investigation by the Economic and Financial Crimes Commission (EFCC) suggested that Mrs. Okonjo-Iweala’s authorization of payment of $ 2.2 million to GAVI was hastily done, and against the protest of Nigeria’s Ministry of Health.
Sources within the Nigerian government, law enforcement and civil society disputed GAVI’s claims that part of the vaccination funds was misused. The groups also questioned the propriety of Mrs. Okonjo-Iweala’s authorization of a refund to GAVI especially as the reconciliation done by several statutory agencies found that GAVI’s fund was not mismanaged in anyway.
The Federal Ministry of Health was so mystified by the refund that its permanent secretary, L.N. Awute, wrote a letter to the EFCC asking for an investigation. Dated July 15, 2015, the permanent secretary’s letter stated it was “surprising to note that the payment of the disputed USD 2.2 million was made to GAVI by the Federal Ministry of Finance” under the leadership of Mrs. Ngozi Okonjo-Iweala without consultation with the Health Ministry.
Mr. Awute further informed the EFCC that the Health Ministry “drew the attention of the then Coordinating Minister for the Economy [Ngozi Okonjo-Iweala] on the necessity for a reconciliatory process to address the discrepancies in the GAVI audit report. However, we are yet to receive any response to our letter from the Federal Ministry of Finance.”
The permanent secretary wrote that the ministry learned of “conflicting information and discrepancies” between their investigation and the GAVI audit, prompting the ministry’s appeal to the EFCC to scrutinize all the findings.
An anti-corruption group, the Civil Society Coalition Network Against Corruption (CSNAC), said it became interested in the matter after learning of GAVI’s allegation that Nigerian officials misused vaccination funds.
However, a source at CSNAC told SaharaReporters that their independent investigation of the missing $2.2 million found no evidence to support GAVI’s claims of misuse.
Our CSNAC source said his group contacted the EFCC, the Corporate Affairs Commission, the Ministry of Health, the Federal Inland Revenue Service, and the United Nations International Children’s Emergency Fund. “All of these groups indicated that they were not aware that Nigerian officials violated any rules in the disbursement of the vaccination funds. Nor did they find that any funds were misappropriated or misused,” the source said.
The EFCC’s report, obtained by SaharaReporters, stated that their investigators had not established any “case of fraud, diversion of funds, or other crimes in relation to the [GAVI] project.” The EFCC report added that their investigation “confirmed that [the] National Primary Health Care Development Agency (NPHCDA) paid all due taxes to the Federal Inland Revenue Service. The NPHCDA also paid required funds to UNICEF in 2012,” contrary to GAVI’s allegations.
According to the EFCC, “all contracts under the [GAVI] project were duly executed” and “the findings from the initial [GAVI] audit report [were] based on unfounded suspicion of fraud.”
Our CSNAC source described GAVI’s audit as “troubled.” He added that the NPHCDA and the Health Ministry blamed “misleading assumptions and non-transparent actions by the [GAVI] CPA team” for the wholly inaccurate audit. CSNAC’s investigation also found that “there was a significant downward revision of the ‘unaccounted sum’ of $8.2 million in CPA’s initial report to $2.2 million in the final report.” This discrepancy underscored the broader problems and concerns over the GAVI audit, the source said.
CSNAC’s independent investigation also debunked GAVI’s allegation that the Federal Ministry of Health and NPHCDA had not supplied the required incinerators. CSNAC’s investigation found that the majority of incinerators were provided at the required locations.
CSNAC concluded that the Nigerian government “has refuted GAVI’s claims and provided documentary and other evidence which contradict GAVI’s claims.” CSNAC contacted GAVI’s representatives in Nigeria to discuss their findings in greater depth, but GAVI demurred, claiming that they were “not in a position to share with information related to the audit beyond what is published.”
CSNAC described GAVI’s attitude as inconsistent with international best practices. It particularly condemned “GAVI’s adamant and uncooperative posture.”
Ex-Minister Okonjo-Iweala’s election to GAVI’s board has raised deep suspicions, considering her role in authorizing the questionable refund of $2.2 million to the group less than one year ago.
Lazard’s hiring of the 61-year-old Okonjo-Iweala has also raised equally significant conflict of interest issues. Neither the firm nor Mrs. Okonjo-Iweala disclosed that Lazard has a subsidiary known as Lazard Frères, a French investment bank that was hired by the Nigerian government as a consultant in the controversial loan forgiveness negotiations that culminated in Nigeria’s payment of close to $20 billion in loan repayments to the Paris Club in 2005. Lazard, which had ties to the Paris Club secretariat, was paid $100,000 monthly for the duration of the loan repayment negotiations, according to sources in the Nigerian government knowledgeable about the deal.
While Mrs. Okonjo-Iweala celebrates her new appointments, she faces serious questions about her management of the Nigerian economy during two Presidencies marked by the theft of billions of dollars from the Nigerian treasury. Besides, even though Mrs. Okonjo-Iweala had trumpeted the Paris Club debt deal as a signal achievement of her ministerial tenure during the Presidency of Olusegun Obasanjo, she oversaw Nigeria’s descent into another era of strangulating debt during her ministerial stint under President Goodluck Jonathan.
“The most important question now, with Okonjo-Iweala’s recent appointments, is whether she traded Nigeria’s economic interests to secure these positions,” said a civic society source.
SaharaReporters contacted representatives from GAVI about these findings and whether they had any connection to Dr. Ngozi Okonjo-Iweala’s election, but the representative refused to answer any questions by phone. GAVI prompted SaharaReporters to submit questions by email but they remained unanswered at the time of publication. GAVI is closely connected to the US-based Bill and Melinda Gates Foundation.
A SaharaReporters correspondent also contacted representatives from Lazard about conflicts of interest related to their dealings with Dr. Ngozi Okonjo-Iweala during the 2005 debt negotiations and her appointment as senior adviser, however our calls were not immediately returned.