ABUJA, Nigeria (AP) -- A Nigerian lawmaker who led a probe into the nation's fuel subsidy program that saw billions of dollars lost through fraud has been charged with allegedly soliciting a $3 million bribe from someone targeted by the inquiry.
Rep. Farouk Lawan and his aide Emenalo Boniface pleaded not guilty Friday to the charges they face in a Federal High Court in Nigeria's capital, Abuja. Justice Mudashiru Oniyang ordered the two men to be held in prison until a bail hearing Feb. 8.
The allegations surrounding Lawan and Boniface stem from their investigation of Femi Otedola, the chairman of Zenon Petroleum and Gas Ltd. and a powerful ally of Nigerian President Goodluck Jonathan. Charging documents released by the court Friday show investigators claim the two men sought a $3 million bribe from Otedola to remove his company from a list of firms suspected of stealing some $6.7 billion from the government through the subsidy program.
Prosecutors accused Lawan of receiving at least $500,000 of the demanded bribe, while Boniface received $120,000. The alleged bribery scandal erupted when Nigerian newspapers published stories claiming Otedola and his associates filmed the encounters. The films have not been released publicly, though Otedola cooperated with police in their investigation.
The bribery allegations quickly overshadowed the work of the House of Representatives, which launched a probe of the subsidy program in the wake of a January 2012 nationwide strike over the removal of the fuel subsidies.
The subsidies, in theory, keep prices artificially low for buyers while paying companies for bringing in refined gasoline at a loss against the world market price. Nigeria, despite producing about 2.4 million barrels of oil a day, has decrepit refineries unable to meet the nation's demand for gasoline due to years of mismanagement and sabotage.
However, gasoline importation licenses became a means of patronage, as the number of companies involved jumped from six in 2006 to 140 in 2011, according to the report. In 2009, when there were 36 companies licensed to import, government officials once issued about $800 million in 128 transactions in a 24-hour period without proper documentation, the report reads.
The probe ultimately called for $6.7 billion to be repaid by importers, the state-run Nigerian National Petroleum Corp. and other agencies. Allegations of corruption continue to hound the subsidy program, which eats away billions from Nigeria's federal budget. However, the comparatively low fuel prices as a result of the subsidy program are one of the few benefits seen by the masses in Nigeria.