Barely 24 hours after the news broke out that Access Bank has acquired Diamond Bank, a Chartered Accountant, Dr Patrick Ayo Akinyelure has instituted a case against Access bank Plc in a Federal High Court in Lagos. He is suing the bank for N100 Million over a breach of contract. The case has however been adjourned till the 20th of January 2019 by the Court.
Joined as co-defendant in the suit is the United Securities Limited.
In a statement of claim which was filed before the court by the law firm of Onu, Uduma & Associates, Dr Akinyelure alleged that he applied for a N30 million loan facility for the purpose of trading on the floor of the Nigeria Stock Exchange.
He offered a collateral security arrangement on the loan, a lien on his existing and security worth as at 24th January, 2008 at least N9 million together with a cash of N1 million which shall be disbursed for the immediate opening of the share trading account
He averred further that he fully complied with all terms and condition of the loan while Access bank through their officials induced and coerced him to execute all the documents by insisting that United Securities Limited will be best suited to manage his share Portfolio purchased from the share Loan Facility profitably with good return on his investment.
He accepted the share Loan Facility and the discounted loan amount was transferred to United Securities Limited by Access Bank for the purpose of acquisition of share for investment in his name.
Dr Akinyelure stated that his tale of woes started sometime in May 2008 when he received a letter from the bank informing him that the interest rate applicable to the share loan facility was being reviewed from 20% to 25% per annum.
He responded by a letter and put forward counter proposal and that the bank should terminate the share loan facility contract if the bank fails to reverse the interest rate applicable to 20% per annum or acceded to the upward review by 5% of his investment of N10 million and N20,024,109.59 in two different branches of the bank.
The bank refused his proposal while unilaterally maintaining the upward review of interest rate applicable to the share loan.
Thereafter the bank over charged interest on his account in the sum of N73,545.92 and by letter dated 21st July, 2008, he demanded the reversal of the said interest sum. The bank never responded. By letter dated 22nd July, 2009,the bank wrote him letter demanding immediate payment sum of N41,119,208.19 being purported amount outstanding on his account within 14 days failure of which the bank threatened to embark on steps to recover its funds in a manner inimical to him.
The Plaintiff at the hearing of this case is contending that the bank breached their duty of care by dealing with his share investment portifolio in a manner inimical to interest and contrary to agreement, which did not yield any profitability or good return on investment, in respect of which he has suffered loss.
Dr Akinyelure further alleged that Access Bank had full and total control and discretion over his share investment portfolio and was under duty to diligently deal with same and ensure the portfolio’s profitability independent of his involvement or contribution, but the bank by wrong investment advice and poor management failed, refused and neglected to deal diligently with his share investment portfolio resulting in depreciation in value and huge accumulation of interest of the loan facility.
The bank was also alleged to have ignored statutory regulatory directive issued by the Central bank of Nigeria to all banks including Access bank in respect of Monetary Policy regulating applicable interest rate.
United Securities was alleged to have ignored best industry practices in managing the Plaintiff’s shares investment portfolio and failed to take steps to mitigate losses on share market movement.
By the reason of the foregoing, the plaintiff has suffered loss and damages, and claim against both defendants jointly and severally are as follows:
An order directing the defendants to pay him damages in the sum of N100 million for losses sustained as a result of the defendants breach of the share loan facility agreement.
A declaration that he does not owe or indebted to the defendants and a declaration that the defendants breached the terms and conditions of the shares loan agreement.
The court has adjourned till 20th January, 2019 for report of settlement or hearing.
Let us know what you think about this new development happening in Access Bank Plc, especially as they just officially merged with Diamond Bank.