Exclusive: Nasty Details Of How Ortom As Benue Governor Took a N10 Billion Loan From Bank To Build Roads and Spent Part of It on Burials, a Birthday and a Newspaper Anniversary – Secrets Reporters Nigeria

Secrets Reporters

SecretsReporters has found documents where Benue State under then Governor Samuel Ortom borrowed N10 billion from one of Nigeria’s major bank in 2020 for infrastructure and human development, at an interest rate more than six times the legal ceiling and diverted part of the proceeds to fund burial ceremonies, a birthday celebration, a thanksgiving mass and the 10th anniversary of a national daily newspaper.

The bank’s offer letter to the Benue State Government, reviewed by investigators, states plainly that the N10 billion term loan was to finance development and infrastructure projects in the state, at a three-year tenor.

The investigators found that projects were indeed executed with parts of the loan: the 36.7km Igbor-Ikpa-Wanune road linking Makurdi-Yandev and Makurdi-Aliade-Otukpo federal roads, confirmed 100 percent complete though already showing signs of failure by the time of inspection; a road from the Customary Court of Appeal to George Akume Way in Makurdi; a female doctors’ quarters at Benue State University Teaching Hospital; the renovation of the Benue Printing and Publishing Corporation complex; and the direct purchase of 20 fairly used Toyota Hilux vehicles for security operations, vehicles that the government verification team was never able to physically sight, when they went visiting.

Public infrastructure money spent on burials and a newspaper’s birthday party

The most serious finding in Benue’s file is not a missing document – it is a diversion Federal investigators state without qualification: “part of the loan was used to support burial ceremonies, birthday, and thanksgiving mass and 10th anniversary of a national daily,” in direct contradiction of the loan’s stated purpose and in violation of Section 41(1)(a) of the FRA 2007, which restricts government borrowing strictly to capital expenditure and human development projects capable of generating long-term economic and social benefit. Ceremonial spending of any kind does not meet that bar.

The Ortom administration’s borrowing terms compounded the problem. The loan carried an interest rate of 20 percent, a figure the Federal investigator’s own report describes as “adjudged to be higher, compared to the ceiling of 3% specified in Section 41(a) FRA, 2007,” meaning the bank lent to Benue State at a rate roughly six-and-a-half times the legal concessional ceiling the Act requires for government borrowing. The three-year repayment term was also found not to be reasonably long enough under the same section of the Act, which calls for extended amortisation periods suited to capital projects. Almost all of the projects verified were never captured in Benue State’s 2020 approved budget, bid evaluation reports were not sighted, and a significant number of the project documents the investigating team requested were simply not made available.

A road built with public loan money was already showing signs of failure by the time auditors inspected it while the government could not explain why part of a N10 billion infrastructure loan went to burials and a newspaper’s anniversary.

The state did produce a cost-benefit analysis and extracts of State Executive Council and State House of Assembly approvals for the loan one of the few states in the FG review to do either and they have recommended that Benue State pursue lower-interest alternatives such as capital market bonds, Sukuk instruments or multilateral loans in future, strengthen its own Fiscal Responsibility Commission, and obtain proof of compliance from the FRC in Abuja before securing any further loans, a state now governed by Hyacinth Alia, who inherited both the completed road projects and the unanswered questions about how a portion of a development loan came to fund celebrations.