‘New AMCON Act to Limit Debtors from Public Contracts’

By James Emejo in Abuja 

The Asset Management Corporation of Nigeria (AMCON) intends to take full advantage of the...

provisions of the AMCON Amendment Act 2, which was recently signed into law by President Muhammadu Buhari, to exert maximum pressure on recalcitrant debtors, a reliable source told THISDAY.

 The new legislation gives AMCON extensive powers to deal with uncooperative debtors who have spurned the available mechanisms to reach agreement and pay their debts.  

 The objective, according to a top source in the corporation, was, “to demonstrate to these people to the full extent possible that they will not get away with cheating the nation.”

Already, with strong support of the Presidency, plans are in place to activate some of the strong measures in the law, including the seizure of properties belonging to the owners of the indebted entities across the country.

Those being targeted are mainly in the list of top debtors which AMCON published in national newspapers in October last year.

The source added: “You can basically say that with the new law and the broad powers we have been given, time has run out on the stubborn debtors. They have no choice but to do the do the right thing or face serious sanctions. And we have the full backing of the presidency.”

Also on the cards, the source further explained, was the implementation of another provision of AMCON Act 2 which was to deny the debtors access to government contracts.

This means that AMCON would compel MDAs to seek clearance from the corporation before engaging, dealing with or paying a client who is on its list of debtors.

 The relevant provision of the new law states that: “The Corporation shall furnish the federal government, ministries, departments and agencies with a list of its recalcitrant debtors and then impose an obligation to seek clearance on the federal government, ministries, departments and agencies when the federal government, any ministry, department or agency proposes to contract with, or pay, debtors on the list furnished by the corporation”.

 To achieve this, AMCON would provide the MDAs with a list of debtors and that the agencies must, in turn, notify AMCON and that any money which ought to be paid to a debtor may be used to offset their debt.

The Act also targets debtors who hide behind banking confidentiality to stop AMCON from accessing details of the sources and locations of their funds. 

Accordingly, private account information and all bank financial and commercial records of any debtor can now be obtained with ease, for the purpose of debt recovery.

The extensive powers which the Act grants AMCON includes the right to: “Obtain access to any computer system component, electronic or mechanical device of any debtor with a view to establishing the location of funds belonging to the debtor, and to obtain information in respect of any private account together with all bank financial and commercial records of any debtor of any eligible financial institution, banking secrecy, and the protection of customer confidentiality is not a ground for the denial of the power of the corporation under this section.”