Nigeria lost $1.7 billion to JP Morgan Chase & Co in London Court battle over its role in the transfers of hundreds of millions of dollars to a former oil minister accused of corruption.
Nigeria’s government said a contract awarded by one of its predecessors to explore the deep waters off the Gulf of Guinea to Dan Etete was corrupt.
But, Judge Sara Cockerill on Tuesday ruled that the Nigerian government could not show that it had been defrauded.
During a six-week trial, Nigeria argued that the US Investment Bank acted negligently when it transferred $875 million in funds from 2011 to 2013 from government accounts to Etete, who had a money-laundering conviction.
Read also: UK Court Okays Nigeria’s $1.7bn Suit Against JP Morgan
The case examined the extent of a bank’s duty of care towards clients, and whether it should have halted payments even if it meant overriding assurances from government officials.
Nigeria alleged that the bank ignored “glaring” red flags, including “overwhelming” evidence of fraud and stark warnings from its compliance staff when it authorised the payments. The West African nation was seeking damages of about $1.7 billion including interest.
It may be that “with the benefit of hindsight JP Morgan would have done things differently”, the judge said. “But again none of these things individually or collectively amounts to triggering and then breaching” its duty of care to its client.
Judge Cockerill said that at the time of the 2013 payments the bank was “on notice of a risk” of fraud. “There was a risk — but it was, on the evidence, no more than a possibility based on a slim foundation.”
“This judgment reflects our commitment to acting with high professional standards in every country we operate in, and how we are prepared to robustly defend our actions and reputation when they are called into question,” JPMorgan said in a statement.
