LAGOS — A former Group Executive Director of Union Bank PLC, Mr. Austine Obigwe, has told the Lagos State Special Offences Court in Ikeja how he wrote off a $2.3 million debt owed to his private company, Staal, by Arik Air.
Obigwe, who testified as a prosecution witness for the Economic and Financial Crimes Commission (EFCC), is involved in the ongoing trial of former Managing Director of the Asset Management Corporation of Nigeria (AMCON), Mr. Ahmed Kuru, and four others.
During cross-examination, Obigwe disclosed that the debt arose in 2011, two years after his exit from Union Bank in 2009, and was subsequently written off due to the operational challenges faced by the airline. “I am not interested in collecting it. I wrote it off when I discovered that Arik Air started having challenges,” he told the court.
The testimony contrasts with Obigwe’s earlier claim during a prior court appearance that Arik was a financially sound company at the time of his departure from Union Bank.
However, under further questioning, he conceded that the airline was “irresponsible, badly run, and immoral,” and acknowledged that he had a close business relationship with its promoter, Sir Johnson Arumemi-Ikhide.
The EFCC has arraigned Kuru and four other defendants—including Arik Air CEO Captain Roy Ilegbodu, former Receiver Manager Kamilu Omokide, Union Bank of Nigeria PLC, and Super Bravo Limited on a six-count charge of conspiracy, stealing, and abuse of office.
All the accused have pleaded not guilty.
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Justice Mojisola Dada granted each defendant bail in the sum of N20 million, with one surety in the same amount.
Obigwe confirmed that after leaving Union Bank, he became a consultant for Arik Air and other entities. When asked if Arumemi-Ikhide was a personal acquaintance, Obigwe affirmed, describing him as a church member and someone he maintains a relationship with, though no longer in a formal business capacity.
Under questioning from defense lawyers including Olasupo Shasore, SAN, Olalekan Ojo, SAN, and Tayo Oyedepo, SAN, Obigwe revealed that he participated in an inspection of 26 Arik aircraft in 2009.
The inspection, based on Lufthansa’s evaluation, found the aircraft to be airworthy. “I had no reason to doubt Lufthansa’s evaluation,” he said.
He further stated that, during his time at Union Bank, Arik Air was not in default of its loan obligations and there were no complaints from other financial institutions.
However, he denied knowledge of a letter dated April 23, 2009, allegedly sent by AMCON to Union Bank about a N46.11 billion debt owed by Arik, despite being the Group Executive Director responsible for overseeing the Arik account at the time.
On the question of how banks manage non-performing loans, Obigwe explained that lenders have several options, including transferring the loan, reassigning it, or enforcing security attached to the loan.
He agreed that Union Bank’s decision to transfer Arik’s debt to AMCON, following the corporation’s establishment by the federal government to absorb toxic assets, was justified.
Obigwe, the second prosecution witness, was led in evidence by Dr. Wahab Shittu, SAN.
The court noted that his consultancy relationship with Arik Air, formalized shortly after his departure from Union Bank, raised questions about a potential conflict of interest, given that he maintained a close relationship with the airline’s promoter while still serving in a key banking role.
The trial continues on June 4, 2025.
