The Economic and Financial Crimes Commission (EFCC) has told a Lagos court that about N4.9 billion realised from the sale of Arik Air’s assets was diverted to establish NG Eagle instead of being used to offset the airline’s outstanding debts.

The claim was made by the Director of EFCC’s Lagos Zonal Directorate 2, Bawa Usman Kaltungo, while testifying under cross-examination before the Special Offences Court in Ikeja in the ongoing trial of former Managing Director of the Asset Management Corporation of Nigeria (AMCON), Ahmed Kuru, and four other defendants.

Kuru is standing trial alongside former Arik Air Receiver-Manager, Kamilu Alaba Omokide; former Arik Air Chief Executive Officer under receivership, Capt. Roy Ilegbodu; Union Bank of Nigeria Plc; and Super Bravo Limited on charges of conspiracy, stealing and abuse of office.

During proceedings, Kaltungo maintained that financial records obtained from Arik Air’s Chief Financial Officer and findings from the EFCC investigation showed that the N4.9 billion was not applied to settle the airline’s liabilities.

According to him, the funds were instead channelled into the creation of NG Eagle, an airline established during the period Arik Air was under receivership.

The witness also addressed the legal status of Arik Air following AMCON’s appointment of a receiver-manager, insisting that although control and management of the airline were transferred, ownership remained with the shareholders.

“Even under receivership, Arik Air still belongs to the shareholders,” Kaltungo told the court.

He explained that a receiver-manager is empowered to take possession of a company’s assets, preserve and manage them, recover debts on behalf of creditors and continue operating the business where necessary.

The court also examined allegations relating to the dismantling of a Boeing aircraft, identified as 5N-JEA, valued at approximately $31.5 million.

The prosecution alleged that Kuru, Omokide and Ilegbodu abused their offices by authorising the teardown of the aircraft in a manner detrimental to Arik Air and Nigeria’s economic interests.

However, under cross-examination, Kaltungo admitted that investigators did not trace any proceeds from the dismantling of the aircraft to the personal accounts of either Kuru or Ilegbodu.

“I have said it before that no money was traced to their personal accounts,” he stated.

Despite the admission, the witness maintained that the dismantling was unlawful regardless of whether any personal financial benefit was established.

The witness was also confronted with documents said to show that JEM Leasing Limited, alleged to be the aircraft’s original owner, had authorised the dismantling. Kaltungo questioned the authenticity of the document, arguing that it was not written on the company’s official letterhead.

The trial stems from allegations that Union Bank misrepresented the status of Arik Air’s loan obligations when transferring them to AMCON, resulting in what the prosecution described as a fictitious debt figure of N71 billion.

Another charge alleges that Kuru, Omokide and Ilegbodu fraudulently diverted N4.9 billion belonging to Arik Air for the benefit of NG Eagle Limited in 2022.

All the defendants have pleaded not guilty to the charges.

Justice Mojisola Dada subsequently adjourned the case until July 7 for the continuation of the cross-examination of the EFCC witness.