N1bn Sanction: Court Dismisses Stanbic IBTC Suit Against FRCN

N1bn Sanction: Court Dismisses Stanbic IBTC Suit Against FRCN

A Federal High Court in Lagos has dismissed a suit filed by Stanbic IBTC Plc against the Financial Reporting Council of Nigeria, FRCN, over N1 billion sanction imposed by FRCN.

Stanbic IBTC had instituted the suit against FRCN seeking to know if the regulatory body has the power to determine its failure to register with National Office for Technology Acquisition and Promotion, NAOTAP, is a criminal offence.

Ruling on the reliefs sought by Stanbic IBTC, Justice Ibrahim Buba held that the reliefs cannot be granted by the court.

The judge held that upon the evidences before him, he was unable to answer all the questions raised in favour of the plaintiff.

Justice Buba held that the contract entered into by Stanbic IBTC with the Standard Bank of South Africa was against the provisions of Section 7 of the NOTAP Act which seeks to protect the country from being used as dumping ground.

“The court cannot find any merit in the instant originating summons and it is accordingly dismissed”, he said.
FRCN had sanctioned Stanbic IBTC over its audited accounts for 2013 and 2014.

FRCN had since August 3, 2015, been investigating Stanbic IBTC Holdings audited accounts for the year ended December 2014.

The investigations concern liabilities accrued in the plaintiff’s 2014 accounts in respect of franchise fees owed to Standard Bank of South Africa, the registration of which it said has been pending before the National Office for Technology Acquisition and Promotion (NOTAP) since 2011.

Stanbic IBTC later sued, praying the court to determine whether FRCN acted beyond its powers.

It also sought a declaration that failure to register a “registrable” agreement under the NOTAP Act is not a criminal offence.
It also sought a declaration that the effect of non-registration of an agreement under the NOTAP Act is as stated in section 7 of the NOTAP Act, namely to prevent payment or remittance of money to any person outside Nigeria in respect of the unregistered agreement.

The bank had in its originating summons prayed the court to determine among others whether FRC has the power to impose a fine of N1 billion on it.

It also sought a declaration that the effect of non-registration of an agreement under the NOTAP Act is as stated in section 7 of the NOTAP Act, namely to prevent payment or remittance of money to any person outside Nigeria in respect of the unregistered agreement.

Stanbic IBTC Holdings Plc said FRC, since August 3, had been investigating its audited accounts for the year ended December 2014.

It added that the investigations concern liabilities accrued in its 2014 accounts in respect of franchise fees owed to Standard Bank of South Africa, the registration of which it said has been pending before the National Office for Technology Acquisition and Promotion (NOTAP) since 2011.