On Friday the 22nd of November 2019, the United States Department of Justice through the U.S Attorney’s Office for the Northern District of Georgia, announced the indictment of Allen Onyema and Ejiroghene Eghagha.
Both are respectively the CEO and CFO of Air Peace, the leading domestic airline in Nigeria which controls at least 40% of the country’s local aviation market.
Air Peace founded in 2013 by Onyema maintains a fleet of 22 active aircraft as at 2019 and operates national, regional and international routes.
The Friday indictment from the U.S DoJ alleges that Mr Onyema and Mrs Eghagha were engaged in money laundering as well as bank fraud to the tune of over USD 20 million, moving from Nigeria through the United States through various financial stratagems equally involving the use of fraudulent documents.
The investigation seems to have been conducted by the high-profile Organized Crime Drug Enforcement Task Forces (OCDETF) Strike Force Initiative which usually focuses on drug-related crime but equally has a mandate for investigating money laundering crimes.
Asides from triggering several legal and compliance issues for Air Peace’s partners and bankers such as AJW Aviation of the United Kingdom, J.P Morgan Chase of the United States and the Bank of Montreal of Canada, the indictment presents a certain amount of geopolitical risk and economic challenges in Nigeria and the sub-region.
Air Peace is the sole airline plying several domestic and regional routes from Nigerian airports and this indictment as well as corresponding cash seizures from the company’s bank accounts are bound to impede the airline’s operations and those of business clients as well as regular passengers.
None of the airline’s domestic competitors such as Arik Air, Aerocontractors, Azman, Dana and others are likely to be able to fill the void if such a scenario arises, owing largely to poor fleet size and financial challenges.
Elsewhere, political ripples from this indictment have been flagged by afridiligence in public commentary reviews with some blaming the current Nigerian government for allegedly having a hand in Onyema’s indictment due to ethnocentric reasons, a claim which seems to be something of a stretch but has nonetheless found an audience in certain quarters of the most populous Africa nation.
All risks considered, the evolving case underlines the importance of conducting effective integrity and enhanced due diligence on partners and their business practices prior to engaging in business transactions with them, regardless of how straightforward or profitable the business case appears to be on the surface.