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UBA Seeks Jail Term for WEMPCO Directors Over ₦61.45bn Debt
UBA Seeks Jail Term for WEMPCO Directors Over ₦61.45bn Debt
UBA has asked a Federal High Court to commit nine individuals linked to WEMPCO to prison over alleged disobedience of a court order.
The bank alleges that the respondents forcibly removed its court-appointed receiver from a steel plant in Ogun State.
The dispute involves ₦61.45bn in funds targeted by a court order and follows failed negotiations over repayment.
October 27, () – United Bank for Africa Plc has asked the Federal High Court to commit nine individuals linked to Western Metal Products Company (WEMPCO) to prison over alleged disobedience of a court order in a dispute involving ₦61.45bn in outstanding debt.
The bank alleges that the individuals forced a court-appointed receiver-manager out of WEMPCO’s steel plant in Magboro/Ibafo, Ogun State, and continued operating the business despite judicial restrictions.
The committal notice, published in The Nation on Tuesday, October 27, under an order permitting service by newspaper, accuses the respondents of “wilful, deliberate and orchestrated disobedience” of an April 2 court order. UBA is asking that they remain in custody until they comply with the order.
Those named are Lewis Shui Noor Tung, Phillip Shui Che Tung, Alhaji M.A. Ola Yusuf, Tung Lawrence Blake, Alli Aare Hadji Tokunbo, Paul Shui Po Tung, Robert Tung, CL Ip and Taiwo Alli. The notice lists their address as 18 Wempco Road, Ogba, Ikeja.
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Alli is managing director of Nigerian Enamelware Company Plc, a Nigerian Exchange-listed company and one of the 17 defendant companies. Robert Tung is also a director of the company.
The allegations have not been determined by the court. WEMPCO’s response was not immediately available.
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Court freezes ₦61.45bn, appoints receiver
On April 2, Justice Akintayo Aluko ordered the freezing of up to ₦61,445,695,993.76 in funds linked to WEMPCO across 27 banks and fintech platforms.
The judge also appointed Romeo Ese Michael as receiver-manager over assets not already pledged under a 2019 credit agreement.
Under the order, financial institutions and platforms, including Moniepoint, OPay and Kuda, were directed to disclose and hold balances belonging to the defendants. The receiver’s powers also extend to two Wärtsilä power generators, wherever they may be found.
According to UBA’s affidavit, court bailiffs initially handed over the Magboro/Ibafo plant to the receiver.
The bank alleges that the respondents subsequently brought in thugs, broke the receiver’s locks and threatened his staff with serious injury.
UBA further alleges that the respondents retained control of the plant, continued operating the business and diverted its funds despite the court order.
The bank says the plant has remained under its control since the alleged incident.
The other defendants include Lagos Oriental Hotel Ltd., United Rolling Mills Ltd., Wempco Steel Mill Co. and Prime Nigeria Tiles Co.
Repayment talks break down
Court documents also detail unsuccessful attempts to negotiate a settlement.
On June 22, WEMPCO’s lawyers at SimmonsCooper Partners, led by Senior Advocate of Nigeria Dapo Akinosun, wrote to UBA seeking an urgent meeting.
They proposed an interim standstill, a joint reconciliation of the accounts and a structured repayment framework.
UBA’s lawyer, Senior Advocate of Nigeria Temilolu Adamolekun, responded the following day. He questioned the request for dialogue in light of what the bank described as physical violence and resort to self-help, but agreed to meet.
The parties met at UBA’s Marina head office on June 26 and agreed to conduct a joint inspection of the Magboro facility on July 2.
However, UBA’s affidavit alleges that WEMPCO and its lawyers failed to attend the inspection and subsequently became unresponsive.
The bank is now seeking committal proceedings against the nine individuals over the alleged breach of the April 2 order.
Enforcement test for secured lenders
The dispute centres on whether a court-appointed receiver can effectively take control of assets when a borrower or its representatives allegedly resist enforcement.
UBA’s recovery efforts follow its reported legal action against Stallion Group involving the same receiver-manager, which MoneyCentral reported on October 16.
WEMPCO was founded by K.F. Tung, who first arrived in Nigeria in 1967.
The outcome of the committal application could have implications for lenders seeking to enforce security over business assets and recover large outstanding loans.
For now, the alleged violations remain claims made by UBA and have yet to be established by the court.
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