EFCC Testifies on CBN Board's Approval of Arik Air Takeover by AMCON

Court testimony has revealed that the Board of Governors of the Central Bank of Nigeria (CBN) formally approved the takeover of Arik Air by the Asset Management Corporation of Nigeria (AMCON), citing the airline’s severe financial deterioration. Testifying before the Lagos State Special Offences Court, an official from the Economic and Financial Crimes Commission (EFCC) presented minutes from a 2017 CBN board meeting where the decision was made to place the airline into receivership.

The case highlights ongoing legal challenges surrounding one of Nigeria's most significant airline interventions and raises questions about corporate governance within the nation's aviation sector. The proceedings involve charges of fraudulent conversion against former executives of AMCON and Arik Air, with alleged sums totaling N76 billion and $31.5 million.

Court Testimony Details Takeover Rationale

Bawa Usman Kaltungo, an Assistant Director with the EFCC, informed the court that the agency obtained a Certified True Copy (CTC) of the CBN board meeting minutes. The meeting, reportedly chaired by then-CBN Governor Godwin Emefiele, concluded that intervention was critical to prevent the airline's imminent collapse. At the time of the takeover on February 9, 2017, Arik Air accounted for a substantial portion of Nigeria's domestic air travel, with some estimates placing its market share at nearly 60 percent.

According to Kaltungo's testimony, former AMCON Managing Director Ahmed Kuru warned the board that Arik Air's operations had deteriorated significantly and that the carrier could cease operations within two weeks without intervention. Kuru also alleged that the airline's owners had effectively abandoned operations after paying out cash collaterals to its technical partner, Lufthansa, facilitating its exit from Nigeria. The decision to intervene was reportedly supported by three of the airline's major creditor banks.

Allegations of Fund Mismanagement and Legal Charges

The EFCC has arraigned several individuals and entities, including former AMCON Managing Director Ahmed Kuru, former Arik Air receiver-manager Kamilu Omokide, and the airline's CEO, Captain Roy Ilegbodu. They face a six-count charge encompassing conspiracy, stealing, abuse of office, and making false statements related to the alleged N76 billion and $31.5 million fraudulent conversion.

Beyond the primary charges, Kaltungo introduced a separate allegation during his testimony. He stated, “In the course of investigation, we discovered that Arik Air’s money was used to pay the insurance of Umza Airline.” He asserted that while Umza Airline had confirmed the payment and initiated a repayment, the full amount had not been returned at the time of the investigation. The EFCC witness claimed that after reviewing the relevant account statements, the investigation concluded the receiver-manager was not properly discharging his responsibilities.

Legal Proceedings and Rulings

The prosecution's attempt to submit the insurance certificate for Umza Airline as evidence was met with strong objections from the defense counsel. The defense, which included several Senior Advocates of Nigeria (SAN), argued that the allegation of fund diversion for insurance payments was not part of the formal six-count charge and was therefore irrelevant to the case. In a bench ruling, Justice Mojisola Dada agreed with the defense, holding that the document could not be admitted as evidence because it was not specified in the charges. The trial has been adjourned until February 26, 2026, for continuation.

Broader Context: Arik Air Under Receivership

The AMCON intervention was executed under the authority of the Asset Management Corporation of Nigeria (AMCON) Act, 2010, which empowers the government entity to resolve non-performing loans and stabilize key sectors of the economy. The takeover of Arik Air reflects persistent challenges in Nigeria's aviation industry, including high debt burdens and corporate governance issues that often necessitate state intervention to prevent systemic disruptions.

Despite being in receivership for several years, Arik Air has maintained a significant operational presence. According to data from the Nigeria Civil Aviation Authority (NCAA), the airline transported 2,239,176 domestic passengers in 2024, securing its position as the country's second-largest carrier. This represents a domestic market share of 19.3%, indicating a degree of operational stabilization under AMCON's management. The ongoing legal case, however, continues to cast a shadow over the circumstances of the takeover and the subsequent management of the airline's assets.

Why This Matters

This high-profile court case serves as a critical examination of Nigeria's framework for managing corporate insolvency and state-led asset recovery. For the Nigerian aviation industry, the outcome could influence future investor confidence and the standards of corporate governance expected of airline operators. The proceedings offer a rare insight into the decision-making process behind the intervention at the Central Bank of Nigeria (CBN) and will be closely watched by financial institutions and regulators dealing with distressed assets in critical sectors.

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