JPMorgan was aware of risk in transfer to Nigerian minister, memo shows
But the bank has denied any wrongdoing and says it is being held responsible for not protecting the Nigerian people from their own government
London — JPMorgan Chase was warned by its compliance team over the “great risk” of corruption just days before it made the last of three transfers that totalled $875m to a former Nigerian oil minister.
The internal memo is set to be scrutinised in a London lawsuit brought by the West African nation. The US bank is accused of ignoring red flags when it transferred funds between 2011 to 2013 from government accounts to Dan Etete, who had been convicted of money laundering.
The current government says a contract awarded by one of its predecessors to explore the deep waters off the Gulf of Guinea was corrupt.
European and Nigerian courts have been raking over the purchase by Eni and Royal Dutch Shell of the oil licence in Africa’s largest crude producer a decade ago. While the energy giants were recently acquitted of corruption charges in Milan in a decision prosecutors could appeal, Nigeria’s government is continuing to seek compensation from JPMorgan.
The memo disclosed at a London court hearing this week shows what JPMorgan managers knew about the oil contract and when, lawyers for the Nigerian government said in court documents. A spokesperson for the investment bank declined to comment.
The government claims Etete distributed the funds received via the bank from the oil majors to corrupt former and serving senior public officials.
The bank has denied any wrongdoing and says it’s being held responsible for not protecting the Nigerian people from their own government.
The government says that by 2013, JPMorgan’s internal concerns over payments to Malabu Oil and Gas — a firm controlled by Etete — were escalating to more senior members of the bank.
“In light of Malabu’s reported connection to the alleged Nigerian corruption scheme, there would be great risk presented if JPMC continues to process wires involving Malabu,” a compliance officer based in the US wrote in a memo dated August 23 2013.
Just six days later, JPMorgan made a payment of $75.2m to the Malabu account.
Lawyers for the Nigerian government said in court on Wednesday it wanted to know how the memo was compiled and asked a judge for more e-mails and documents from the compliance team.
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