The lawsuit said that JP Morgan then transferred the funds to two accounts controlled by Etete, without sufficient due diligence to make sure the money did not leave accounts controlled by the Nigerian government. Reuters was unable to reach either Etete or Malabu for comment.
MILAN CASE
The filing seen by Reuters was made in London in November on behalf of the Federal Republic of Nigeria, and says that JP Morgan acted with gross negligence by allowing the transfer of the money without further checks. It said JP Morgan should have known that, under Nigerian law, the money should never have been transferred to an outside company. “If the defendant acted with reasonable care and skill and/or conducted reasonable due diligence it would or should have known or at least suspected ... that it was being asked to transfer funds to third parties who were seeking to misappropriate the funds from the claimant and/or that there was a significant risk that this was the case,” the filing said. Late last year, a Milan judge ruled that Shell and Eni must stand trial in Italy, where Eni is headquartered, for a separate legal case in which Milan prosecutors allege bribes were paid to Etete and others as part of the same oilfield deal, including sums that went to Etete’s Malabu. Both Eni and Shell have repeatedly denied any wrongdoing in relation to that case. Malabu has never commented on the case and Reuters has not been able to contact it. Shell last year said it knew some of its payment to the Nigerian government as part of the deal would go to Malabu “to settle its claim on the block”, but that it was a legal transaction.
There are also ongoing investigations regarding the deal in Nigeria and the Netherlands, where Shell is based. The license for the offshore block was awarded to Malabu in 1998 under then-President Sani Abacha, but Shell finalised a deal for the block with the Nigerian government in 2011. A British court, in a judgment late last year that agreed to return to Nigeria $85 million in frozen funds related to the deal, said that Malabu was controlled by Etete. *Reuters
