The Economic and Financial Crimes Commission has frozen the Osun State government's statutory allocation account held at First Bank, directing the lender to place a Post No Debit restriction that blocks withdrawals from the account. The anti-graft agency confirmed the action after the state government went public with a protest, framing the measure as a step to prevent what it described as the diversion of public funds rather than an attempt to seize them.
According to the commission, the freeze was not driven by the investigation on its own. The EFCC said it acted after detecting what it called a precipitate and unwarranted movement of funds from the state accounts to several suspicious accounts from August 2. It maintained that the sudden outflows, rather than the long-running inquiry alone, prompted the emergency restriction on the account.
The EFCC said it had been examining the Osun State government's finances since around March over the alleged fraudulent handling of about 11 billion naira. The sum, according to the commission, covers ecology funds, intervention funds and monies released through the Federal Account Allocation Committee, the body that shares federally collected revenue among the tiers of government.
Analysts reviewing the case on Channels Television pointed to Section 6, subsection 5B of the Money Laundering (Prevention and Prohibition) Act of 2022 as the legal window used by the commission. That provision allows the chairman of the EFCC or an authorised representative to place a stop order not exceeding 72 hours on any account or transaction suspected of being linked to a crime, without first obtaining a court order.
Governor Ademola Adeleke rejected the action as an abuse of due process, insisting that the commission moved against the state's account without any court order and that federal agencies were trampling on the constitutional rights of subnational governments. He called on the EFCC chairman to explain the freeze publicly and to produce proof, and directed the state's Attorney-General and Commissioner for Justice to challenge the measure before the Federal High Court in Osogbo.
The Nigerian Bar Association also weighed in, warning that any directive restricting withdrawals from a state government's accounts would effectively cripple governance and amount to an abuse of power. The association argued that the commission could seek court orders against specific accounts suspected of fraud, but could not lawfully freeze all of the accounts belonging to a state government.
The dispute has landed about nine days before the Osun governorship election scheduled for August 15, and commentators on the programme questioned the timing, noting that the investigation had been known for months and asking why the restriction was imposed now. It was also observed that while a sitting governor is shielded from criminal prosecution by the immunity clause, the resources of the state do not enjoy the same protection, leaving the accounts open to such action.