LASU Pro-Chancellor and the Vice Chancellor have been accused of
diverting N198 million Staff Pension to buy luxury vehicles.

LASU VC, Olanrewaju Fagbohun

The management of Lagos State University (LASU) diverted N198
million it illegally withdrew from the contributory pension of the
institution’s employees to purchase 12 luxury vehicles for members of
its top echelon, a PREMIUM TIMES investigation has revealed.
The management also used an additional N83.37 million from the same
fund to buy four buses, documents obtained by this newspaper revealed.
The N281 million was part of N474 million withdrawn in October 2018
purportedly to finance the National University Commission’s (NUC)
accreditation of some academic programmes in the university. Nigeria’s
pension legislation prohibits such withdrawal.
The management of LASU collects pension contributions of staff
members and remits them to Pension Fund Administrators (PFAs). However, a
good percentage of the university’s employees are not registered with
any PFA.
PREMIUM TIMES learnt that those without PFAs wanted their pension
funds to be administered by the Nigerian University Pension Management
Company (NUPEMCO), which was only licensed National Pension Commission
PENCOM in February after a nationwide strike by university lecturers,
For those employees awaiting the registration of NUPEMCO, the
university kept their pension contributions in an escrow account, a
practice that PENCOM said negates pension regulation.
“There is a regulation that when employees do not open a
retirement savings account, the organisation has the liberty to approach
a pension fund administrator and transfer those funds there. Those
funds will be kept in what we called a Transitional Contributory Fund
Account pending when they open a retirement savings account,”
 Peter Aghahowa, spokesperson for PENCOM, told PREMIUM TIMES.
“The account is domiciled with the PFA. The whole idea about
the regulation is that the account should not be domiciled with the
employer because, no matter if it is placed in an escrow account or not,
there is the tendency of those funds being used when there is pressure.
“From the little I have heard, quite clearly, the university
didn’t follow the regulations through. The things they ought to have
done, some of them they didn’t do,” 
he added.
Section 60, subsection 2 and 3 of the Pension Reform Act, 2014 buttresses the explanation of Mr Aghahowa.
“All companies and institutions already engaged in the
management of pension funds who are not licensed by the commission
shall, at the commencement of this Act, compute and credit all
contributions to Retirement Savings Account opened by them for each
contributor including distributable income,” 
it says.

“All companies and institutions referred to in subsection (2)
of this section shall transfer all pension funds and assets held by them
to Pension Fund Administrators and Pension Fund Custodians as may be
determined by the Commission.”

Also, Section 70 subsection 2 of the Pension Reform Act 2014
forbids a custodian of workers’ pension – LASU management in this case –
from using the pension to meet its own obligations.
“The Pension Fund Custodian shall not utilise any pension fund
or assets in its custody to meet its own financial obligations to any
person whatsoever,”
 the section of the act stated.
Breaking the law
But the withdrawal in October 2018 was not the first time LASU’s
management would unlawfully withdraw money from its staff’s pension
In March 2018, the university management withdrew N215 million from
the pension escrow account to fund the accreditation of 17 academic
An internal memorandum of the university’s governing council
ratifying an executive order of the university’s pro-chancellor and
chairman of the Governing Council, Adebayo Ninalowo, said that the Lagos
State Government had approved N215 million for the accreditation, but
was yet to release the fund; therefore, the university had to borrow
from the staff’s pension account.
“In view of the pending accreditation exercise and the time
constraint, the university sought and obtained the executive approval of
the Pro-Chancellor and Chairman of the Governing Council for temporary
borrowing of the sum of two hundred and fifteen million naira
[N215,000,000.00] from the university’s pension/escrow investment in
order to cover the expenses of the forthcoming accreditation exercise
which would be paid back from the approved grant from the Lagos State
Government, when paid to the university,” 
the internal memo stated.
However, a June 21, 2018 bulletin of the university’s branch of
Academic Staff Union of Universities (ASUU) claimed that only N148
million was actually disbursed for the said accreditation exercises.
The bulletin, which gave a breakdown of the amount spent on the
exercise for each of the 17 programmes and other related financial
obligations, frowned at how the money was disbursed.
It claimed that top academic staff of the affected programmes were blindsided from the exercise.
“It is noteworthy that principal officers and senior
non-academic staff members were mostly the ones who oversaw the
supervision and disbursement of accreditation funds for various academic
programmes in these faculties,” 
the bulletin, which was co-signed by Tony Dansu, the secretary of the union and his assistant, Adeolu Oyekan, alleged.
For instance, the union claimed the immediate past registrar of the
university was placed in charge of the accreditation of academic
programmes in the Faculty of Education with a budget of N23.5 million.
The university’s bursar, Adetayo Hassan, was placed in charge of
the exercise at the faculty of Management Science with a budget of
N19.5million, while the university’s director of internal audit, Said
Olayinka, was placed in charge of Engineering and given a budget of N51
million for the exercise.
More withdrawals
By October, the university embarked on another accreditation
exercise. This time the university pro-chancellor unilaterally ordered
the withdrawal of N474 million from the staff Pension Investment Fund
account for the accreditation of 20 academic programmes.
According to the October 5 memo, the state government had promised
to release funds for the accreditation, but the money had not come and
the university was unsure when it would arrive. The university said it,
therefore, took alternative steps so as not to miss out of “securing full accreditation for the affected programmes”.
In doing so, it promised that the fund would be returned with
interest as soon as it received the fund for the exercise promised by
the state government.
PREMIUM TIMES could not confirm if the funds withdrawn from the
staff pension account on both occasions had been returned as promised by
the university’s management.
When asked if indeed the government assured the university that it
was going to provide the fund for both exercises, Obafela Bank-Olemoh,
the special adviser on education to the governor of Lagos State,
Akinwunmi Ambode, declined to comment.
“I am not going to respond to that. I don’t work in LASU,” he said.
“My brother write your story. I am not going to respond to
anything. You are writing a story about LASU, reach out to LASU and let
them respond to you,”
 said Mr Bank-Olemoh, who is in charge of tertiary education in the state.
Beyond Approval Limits
But sources within the university, who asked not to be named for
fear of being victimised told PREMIUM TIMES that apart from the
illegality of tampering with staff’s pension fund, the amount Mr
Ninalowo, the pro-chancellor, approved for withdrawal was way above his
approval limit.
According to a February 23, 2016, internal memo of the university’s
governing council obtained by PREMIUM TIMES, the expenditure approval
limit of the university’s pro-chancellor was reviewed upward from N10
million to N20 million while that of the university’s vice chancellor
was reviewed upward from N3 million to N5 million.
For the expenditure of any amount beyond fund above N20 million,
the pro-chancellor has to seek the approval of the governing council
after first discussing such expenditure with the Finance and General
Purpose Committee (F&GPC) of the council.
In both cases above, our sources alleged that the withdrawals were
unilaterally done by the pro-chancellor without recourse to the
F&GPC. An internal memo seen by this newspaper suggested that in the
October 2018 withdrawal of N474 million, the university management
secured the approval of the governing council after the fact.
“In view of the impending accreditation exercise and the time
constraint, the university sought and obtained the executive approval of
the Pro-Chancellor and Chairman of the governing council for temporary
borrowing of the sum of four hundred and seventy four million naira
[N474,000,000.00] from the university Pension Investment Fund in order
to cover the expenses of the forthcoming accreditation exercise,”
 the memo stated.
The memo added that the governing council ratified the approval after deliberation.
Purchase of Luxury Cars
Sources in the university told this newspaper that the management
decided to use a large chunk of the money for things with completely no
correlation with that for which it was withdrawn. More than one source
said the university also cut corners and came up with ploys that fooled
the team of NUC accreditation assessors.
The NUC accreditation process involves the assessment of seven
components of an academic programme – academic matters, staffing,
physical facilities, library, funding and employer’s rating of
However, the university management used the lion share of the fund
to purchase of 12 luxury vehicles for top management staff, which have
nothing to do with the accreditation process.
The vehicles were three pieces of Toyota Corolla1.8 Gli CVT AT LS
Luxury model at N63 million plus VAT, seven pieces of Toyota Corolla 1,8
Gli CVT AT FS luxury model at N113.9 million, and two pieces of Toyota
Yaris Sedan AT LS (New Model) at N21.42 million for a total of N198.34
The university’s vice-chancellor, Olanrewaju Fagbohun, also
approved the purchase of four 18-seater buses for a total sum of N83.37
The cars were distributed to top management members in the week of October 22, 2018, our investigation revealed.
“A total sum of N198,345,000 was expended on the 12 cars, which
will not be assessed by the NUC, whereas the classrooms, staff and
departmental offices, studios and laboratories that would be evaluated
for the accreditation remains in pitiable conditions,”
 another source said.
While the school management spent the funds on the purchase of
luxury vehicles, it only approved a fraction of the budgets sent in by
departments for the exercises. For instance, the Department of Zoology
requested N60 million for the exercise but the university only approved
N13 million.
A source told PREMIUM TIMES that the School of Agriculture
requested N400,000.00 to procure the cable needed to install internet in
the faculty, the project was aborted midway allegedly on the orders of
the vice chancellor. But before the team of NUC assessors arrived the
faculty for the accreditation exercise, the university had purchased
Wi-Fi dongles which was given to a number of employees to create the
impression that the faculty had a functional internet connection.
“After the accreditation exercises, the internet disappeared,” the source said.
“The bitter truth about this charade of accreditation
preparation is that offices for the staff and programmes were mostly
never upgraded but rather, some stranded offices of other departments
and staff were hurriedly tagged as belonging to the programmes earmarked
for accreditation,”
 the source added.
One of our sources alleged that one of the Toyota Corolla
purportedly bought for the accreditation exercise was given to the
“I challenge the university administration to list how the
vehicles were distributed. This is one of the reasons why the
pro-chancellor will always approve executively all demands of the
university management without recourse to the F&GPC or the governing
 the source added.
The vice-chancellor, Olanrewaju Fagbohun, did not respond to
questions sent to his email despite an automated response confirming
that the questions were delivered.
Ademola Adekoya, the LASU spokesperson, who originally did not
respond to questions sent to him for comment, later told this reporter
upon a follow-up call that the university management has decided to be
“quiet for now.”
“If there are people who want to know, they should actually get
the facts right. Because, most of the things (claims), they are not
actually correct. We don’t want to respond to it.”


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