Financial fraud rocks Magodo estate, top officials embezzle millions

The Magodo Residents’ Association is embroiled in controversy as top officials, including Chairman Sheriff Daramola and an individual named Kunle, face accusations of embezzling millions of naira.

The allegations, which involve financial irregularities, unauthorized expenditures, and missing funds, were first brought to light by the association’s internal auditor, Lawson Adesokan.

In a memo dated December 13, 2023, Adesokan raised concerns about suspicious transactions and accused the chairman of approving additional security measures without the board’s consent.

He noted that Daramola’s decision to authorize N4.8 million per annum for four extra police officers exceeded his approval limits and lacked proper oversight, raising questions about accountability within the association.

The ongoing investigation has revealed gaps in documentation, making the association vulnerable to financial losses. Members are calling for greater transparency and accountability to resolve the issue.

“I understand payment of PR to the police commanders is not unusual, but if the amount is running over N10m, it should not be handled by only one person, which in this case is the security secretary.

“An additional N4,800,000 per annum and to be disbursed by only one person is prone to fraud, and it is a concern to me. Besides, the method of transferring the money out of the association is questionable.

“A fictitious payment voucher will be prepared and cash paid to a staff member by the name Moses Alawode who knows nothing about the intended purpose. The money will then be transferred by him to the security secretary. This to me is a red flag right there,” the auditor said.

Following the discovery, Saturday PUNCH gathered that the estate’s Board of Trustees and the Magodo Residents General Assembly set up investigative committees to probe the involvement of Daramola and Kunle in the alleged mismanagement of the estate’s security funds.

Documents obtained by our correspondent revealed that investigations carried out by the committees identified discrepancies in police allowance payments, lack of documentation, and significant weaknesses in financial management practices.

Going through some of the documents, it was discovered that the security secretary received funds for police allowances without disbursing them to officers, while the chairman approved expenditures exceeding his authority.

The investigation also revealed that Kunle had been making the payments without disbursing the funds to the intended beneficiaries, raising suspicions of embezzlement.

In a report dated June 11, 2024, one of the investigative committees said it discovered that there was a lack of documentation and oversight in the disbursement of funds within the association.

The committee revealed that investigation conducted through interviews with different stakeholders including Divisional Police Officer and Station Officer showed that some payments made to police officers by the security secretary were not documented.

While recommending the suspension of Kunle over alleged mismanagement of funds, the committee suggested that the association’s chairman should receive a reprimand for lack of due diligence and oversight.

The report further read, “The investigation revealed significant weaknesses in the current financial management practices related to the payment of security allowances and public relations funds.

“The security secretary had disproportionate control over the process, with insufficient oversight and documentation, leading to potential mismanagement of funds.

“The mismanagement of funds has undermined the trust and transparency within the estate association, potentially jeopardising the security arrangements and financial stability of the estate.

“The lack of proper documentation and oversight has created vulnerabilities that could be exploited, leading to financial losses and dissatisfaction among the security personnel.”

Similarly, an ad-hoc committee report dated August 5, 2024, and sighted by our correspondent revealed that the security secretary received money from the association from May 2023 to August 2024 without disbursing the funds to police officers from the Isheri Division.

The committee said the security secretary “failed to report the above diversion of funds or provide documentation where the unused funds were utilised.”

It stated, “The Divisional Police Officer and Station Officer both of Isheri Division confirmed regular payment of allowances till May 2023, and thereafter no payment has been made to them till date. The Security Secretary, Mr Kunle Kosile, also admitted to receiving the payments from the MRA accounts department all through the year 2023 and did not remit the same to the officers in Isheri since May 2023 till date.

“The Security Secretary continuously included the DPO and Station Officer, Isheri, in the list of officers, which also included officers from the Magodo Station to be paid from the total sum of N175,000 payments monthly that was approved by the CMC Chairman — Mr Sheriff Daramola, from June 2023 till December 2023, thereby using their names to get approval for funds to be disbursed and same funds were diverted.

“The station officer in Magodo also testified that the monthly payments to Magodo Police post continued promptly till September 2023, but payments seized in October 2023 till the second week in December 2023 where all outstanding were paid with the station officer of Magodo testifying that the payments and gifts given to him from the Security Secretary were personal gifts not from MRA. However, records show payments from the MRA accounts were disbursed promptly every month for the same purpose.”

Meanwhile, the President of the South West Zone, Magodo Residents’ Association, Nosa Ebomoyi, lamented that despite the committees submitting reports about what was discovered during fact-finding, no action had been taken.

Ebomoyi, in a letter to residents dated September 30, 2024, claimed that the residents paid N3000 for access control stickers, which remained non-functional.

While noting that the mismanaged funds belong to residents, including the elderly, retirees, widows, and widowers, Ebomoyi vowed to continue fighting for the truth.

He added, “Let me say that I am used to the shenanigans of having people come to the general resident’s meeting to defend allegations where evidence is superior. Please recall the issue of the shuttle bus cabal, where I worked with the interim committee and ensured buses were returned back to the zones which have increased revenue from N45m to over 1N35m for the past three years.

“This was also the same issue with gate takings at the Magodo gate, where the fraud was uncovered and revenue increased from N400,000.00 to about N4m monthly. If we multiply all these it is over N160m income for the Estate. Not forgetting the MRA Townhall, where I raised the issue of over-inflation of contracts which led to the emergence of Chief Akinseye Building Committee, which saved the estate of over N23m.

“With this MRA has to be very careful or the revolt of payment of dues will start because of the mismanagement of funds.

“The essence of this message to you, my good people of Southwest, is to keep you up to speed on what is going on and to get us prepared for the next General meeting which the BOT said is in two weeks from now. I will not give up on fighting and working for the truth.”

Reacting, the MRA Chairman insisted that due processes were followed in approving security funds and other money spent by his administration.

While attributing the allegations to ‘mischievous characters’ with selfish motives, Daramola denied approving any funds without consent from the association’s structure, which consisted of the board of trustees, CCC, and CMC, with 21 executives from different zones.

On the missing N4.8m, he argued that the reports from different committees found no evidence of his involvement in the alleged financial misappropriation.

He explained that the two committees only discovered that the practices in question were inherited from previous administrations.

“The committees’ reports showed that the approval process for security funds has been in place for years, even before my administration. The reports recommended improvements to the process going forward,” Daramola clarified.