The N43m Contract To Unregistered Company Violates State Procurement Law, SFTAS Goals
By Christiana Ofem
Public money intended to revitalize Cross River’s Callywood studio went astray. A probe found the N43 Million contract for studio equipment went to an unregistered company, violating procurement laws. The studio is now derelict, and the entertainment industry is frustrated. Pressure mounts on the new governor to investigate and breathe life back into the project.
From October 8th to 22nd, 2020 several cities in Nigeria were rocked with the #EndSARS and #PoliceBrutality peaceful protests demanding the immediate disbanding of the notorious Special Anti-Robbery Squad (SARS) unit of the Nigeria Police Force.
Days later, the peaceful protest turned into massive looting and destruction of public and private properties.
In Cross River State the problem started on Friday evening, 23rd October 2020 when some youths under the guise of a protest, broke into the State Housing and State Emergency Management Agency (SEMA) warehouses in Calabar and made away with the COVID-19 palliatives before other citizens joined them to cart away both food and non-food items.
WAEC and JAMB headquarters in the State capital, Tinapa, the University of Calabar, the National Identity Management Commission (NIMC) office, the Garment Factory, and the Rice Seed and Seedlings Factory were touched by the looting and destruction.
Some government politicians’ houses and private business premises were equally looted and destroyed in the process.
Among the properties touched by the looters in Tinapa, Cross River State’s once most-priced business and leisure resort is the Callywood studio. It operates from Callywood City located inside Tinapa, Adiabo in 8 Miles Calabar Municipal local government area.
Callywood City Ltd was incorporated by Governor Ben Ayade on the 18th of July 2016 with the Corporate Affairs Commission (CAC) as a private company limited by shares. Its registration number is RC 1348381 and its status is inactive, see the directors below.
Breach Of Procurement Law, SFTAS Goals
On the 15th of September 2021, the Cross River State Government contracted Livics Nigeria Enterprises to procure equipment for the Callywood studio valued at N43,478,800, aiming to boost the state’s creative economy.
According to the evidence of contracts awarded in 2021, a document prepared by the Due Process and Price Intelligence Bureau (DPPIB) the procuring entity is the Governor’s Office/Events Management department headed by a Special Adviser, Mr. Kenn Aklah gave the contractor four (4) weeks to deliver the equipment.
From the document, TheInvestigstor established that the contract and 78 others were awarded from a World Bank grant. Cross River State got a $20.4 million grant from the World Bank’s States Fiscal Transparency, Accountability, and Sustainability (SFTAS) program.
The N43,478,800 contract to procure equipment for Callywood studio awarded to Livics Nigeria Enterprises was awarded by the immediate past government of Sen. Ben Ayade on the 15th of September 2021.
Checks on the Corporate Affairs Commission (CAC) and NG-Check websites by TheInvestigator reveal that Livics Nigeria Enterprises is not incorporated and, thus, not qualified for any government job.
The contract violates Part 3, section 6(b) of the State Procurement Law, 2020. The law makes it mandatory that all bidders “shall possess the legal capacity to enter into the procurement contract.”
Furthermore, the contract is at variance with the Project Development Objective (PDO) of the SFTAS program – to strengthen fiscal transparency, accountability, and sustainability in participating Nigerian states.
Studio Closed, Weeds Overtake Premises
A three-week investigation by this reporter reveals that the ghost contractor, Livics Nigeria Enterprises did not deliver the equipment.
Furthermore, the Callwood studio has been abandoned after the mayhem of the #EndSARS and #PoliceBrutality protest in October 2020.
Several visits showed that the studio is not functional, some sections are under lock and key while others are wide open.
Overgrown weeds surround the environment, and part of the roof is open. Studios 1 and 2 do not bear the looks of N43,478,800.
Contradiction
Mr. Kenn Aklah, Special Adviser to Governor Ayade on Governor’s Office/Event Management was contacted by TheInvestigator about why the contract was awarded in violation of the state procurement law, he claimed it went through due process. On why the equipment has not been delivered, he said the contractor was not paid.
According to him his office only facilitated application and did not get credited with the money or notified if disbursement was done.
Kenn Aklah.
Mr. Kenn said “She made an application to His Excellency the Governor that she wanted to buy some equipment for Callywood. At that time she didn’t have the subhead, at the time they conceived Callywood it was under event management so when the document came for processing and all that they (his office) did. She was the one who took the money after the processing, the accounting department could tell you.”
He further stated “She has been separated from us by being made the DG. The event management will process the document to final payment but payment will be done to her. We did that for a lot of people who had subhead issues.”
Mr. Kenn, when pressed further by TheInvestigator, withdrew his earlier statement stating that “I thought you meant 2016”. He quickly clarified “I’m not sure they have paid any company that money. There was a contract that passed through due process and all of that for payment to be made but I’m not aware those payments were made.”
He went on to assert that until Gov. Ayade left office last year and the contractor and some others were not paid, he did not provide the reason.
On the findings of this investigation that Livics Nigeria Enterprises is not registered with CAC, Mr. Kenn said “It was, they went through due process.”
Mr. Kenn has been appointed as an adviser by the current governor, His Excellency Senator Bassey Edet Otu. He was appointed Special Adviser Power in a press release with reference number GO/PRESS/012/VOL.IV/43, dated 5th of March 2024 and signed by his former Chief Press Secretary, Mr. Emmanuel Ogbeche.
Contrary to Kenn’s claim, the then Director General of Callywood studio, Shan George acknowledged receiving N18 million in 2021 for the purchase of equipment but not through the Governor’s Office/Events Management department.
Speaking to TheInvestigator over the phone Shan revealed that “I wrote directly to His Excellency requesting for N20 million to purchase equipment, N18 million was approved and paid directly to me.”
The entertainment guru revealed that after her appointment in 2019, no office was allocated to her; she has been operating from her studio, not Callywood’s.
Shan George.
The N18 million piece of equipment she purchased is in her studio. When asked why she said “I was already doing my film academy because at that time my mom was sick, I had turned my parlor into a studio. The equipment is in my studio, we had shot some movies then which are still with me waiting for the government to tell us what to do.”
Shan revealed that her office has increased the capacity of local entertainment workers in the state such that “just come with your money, you can get all the crew here”.
Stakeholders React, Calls For Investigation
Entertainment stakeholders who spoke to TheInvestigator expressed disappointment about the state of the studio, counting their losses. Some called for a probe into the contract while others urged the current administration to revive Callywood Studio.
Egor Kelly, pioneer DG of Callywood studio spoke to TheInvestigator over the phone from the UK about the state of things.
The Nollywood filmmaker said memories of Cross River State break her heart because “what I was promised wasn’t what I met. I was told I was coming to run a $1 million studio, I came down with a team of people but nothing,” Egor paused and pleaded to stop the interview there because it opened up old wounds. Egor revealed that she left office in January 2018.
Joe Esse is the chapter Chairman of the State Actors Guild of Nigeria (AGN) and Entertainment Union, speaking with TheInvestigator he blamed the State Government for the failure.
In his words: “It’s terrible, I hold no individual accountable but the government. It is appalling to see that an organization such as that was created for people who make films and bolster the film industry in Cross River State and nobody can give an accurate account of what transpired.
“Callywood was in Cross River State throughout the Ayade’s administration. We first had Egor Kelly who came from America on an appointment and used Tinapa Studio and Lakeside Hotel. We had nothing at the end of the day to account for.
“In his second tenure, we had Shan George as DG replacing Egor Kelly and you are hearing that a DG did not have an operational office. It is appalling and disappointing to the government.”
On the impact, he said “This is one of the worst things to happen to the entertainment industry, especially the movie sector. It is crazy and sad that a lot of people have been discouraged from going into the film business, especially those who had the anticipation that the government is coming in and our dreams can come alive.
“I know Kenn Aklah was a very close friend and ally of the governor, whether he was DG Callywood or not he ought to have known more. If he says he doesn’t even know if the funds were released it shows a very poor system of government that was operated.
“Callywood was under his purview, if he says he doesn’t know then it means it’s either he’s not telling the truth or the then governor didn’t do the right thing. You can imagine how many investors would have come to Cross River State.”
He revealed that “Debt owed at the studio and Tinapa Lakeside hotel were worth over N180 million, I’m not talking of the ones that were spent.”
On his part, the State chapter chairman of the Performing Musicians Association of Nigeria (PMAN), Prince Emmanuel Effiom, known by the stage name Rebreed said he is also disillusioned by the state of the entertainment sector in Cross River.
He spoke with TheInvestigator over the phone, “I got wind of that news and I was heartbroken because when we are doing everything we can, making frantic efforts to better the lives of musicians in Cross River State, and trying to boost the entertainment industry so that we can make it. Some people were just sitting down, embezzling, and shortchanging the entertainment industry.”
Calling for the new administration to probe further, Rebreed said “I believe that justice must be done, whosoever is involved must be brought to book. No group of people should divide it as if it belongs to them. So we from PMAN are willing to get as involved as possible to ensure those people are brought to book.”
TheInvestigator produced this investigation through its Environmental and Accountability Reporting (EAR) project with support from CITAD and the MacArthur Foundation.