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Revived Enron Unit Loses Appeal to Claim Nigerian Yacht Proceeds
Federal judges upheld a decision made last year that allowed the American government to assume ownership of $37 million generated from the auction of the Galactica Star, according to a ruling filed on Sept. 13. U.S. prosecutors initiated a lawsuit four years ago to enable them to seize the 213-foot vessel and other assets, alleging that Nigerian businessman Kolawole Aluko acquired them with the spoils of bribery.
Enron Nigeria Power Holding Ltd. says it’s entitled to more than $22 million of the yacht’s sale proceeds. The company is trying to collect on an arbitration award issued against the Nigerian government for suspending a contract signed with the firm in 1999 to build and operate a power plant.
Remember Enron? Its Name’s Resurfaced in a Luxury-Yacht Battle
Once a subsidiary of Enron, the energy-trading giant that hid billions of dollars in losses and filed for bankruptcy 20 years ago, ENPH was bought by undisclosed shareholders in 2004.
After Nigeria’s government turned down a request by ENPH’s new owners to revive a contract paused before Enron’s collapse, an arbitration tribunal awarded the company $11.2 million in damages in 2012. A U.S. court later confirmed the debt. The amount owed has doubled with accumulated interest, according to ENPH.
Rejecting ENPH’s argument, a federal court in Texas agreed in May 2020 that the U.S. government was entitled to the Galactica Star’s sale proceeds. The judge reached his decision after the Nigerian state dropped its competing claim to the money and sided with the U.S. authorities. The two governments plan to use the money for the benefit of the Nigerian people.
A lawyer representing ENPH didn’t immediately respond to questions about the dismissal of the appeal.
Prosecutors targeted assets for confiscation that Aluko had acquired for more than $160 million, including the yacht for $82 million in 2013. They allege the businessman financed the purchases with lucrative oil trading contracts secured by bribing Diezani Alison-Madueke, Nigeria’s petroleum resources minister from 2010-2015.
Source: Bloomberg Business News