A former Managing Director (MD) of Imperial Micro Finance Bank, Chijioke Mbagwu, was yesterday, arraigned before the Federal High Court, Lagos, for fraud.
Mbagwu is being prosecuted by the Federal Ministry of Justice on 14 counts of fraudulent diversion of funds, as well as granting of unsecured credit facilities.
But, he pleaded not guilty to the charges pending before Justice Ayokunle Faji.
According to the charge, the defendant committed the offence between 2007 and 2008, while serving as MD of Imperial Micro Finance Bank.
He was alleged to have granted N25 million unsecured credit facilities to micro finance bank, formerly called Nsulu Community Bank, which he allegedly owns.
In counts two to five, the defendant was also alleged to have granted unsecured credit of about N4.5 million to the bank.
In counts six, he was alleged to have acted both as MD of Imperial Micro Finance Bank, as well as Chiik Finance and Securities, which is not a subsidiary of the micro finance bank.
In counts seven to 11, the defendant was alleged to have fraudulently obtained about N29.5million from Imperial Micro Finance Bank, under the pretence that it was for management of the bank.
He was alleged to have diverted the said funds to Investment Micro Finance Bank.
In count 12, he was alleged to have obtained N10million from Mega Equities Ltd, under the pretence of helping it secure shares from Imperial, but diverted same to Chiik Finance and Securities.
In counts 13, he was alleged to have fraudulently obtained N8.7million from Imperial Micro Finance Bank, and diverted same to the account of Chiik Finance and Securities, with intent to promote illegal banking activities. The offences contravene the provisions of sections 1(a), 15, 16 and 19 of the Failed Banks (Recovery of Debts) and Financial Malpractices in Banks Act, Cap F2, Laws of the Federation, 2004.
After his plea, defence counsel, Mrs S. Anoka moved a bail application on behalf of the defendant and urged the court to grant him bail on the most liberal terms.
In response, the prosecutor, Mrs. Ogochukwu Mba, a senior state counsel from the Federal Ministry of Justice, opposed the bail application on the ground that the defendant had evaded his arraignment on two occasions. She also told the court that the defendant tried to feign absence, when required by the police.
The prosecutor, therefore, urged the court to refuse bail on these premise.
In a short ruling, however, the court held that the defendant had shown reasons why he should be granted bail.