Introduction
Nigerian creditors often resort to various means to recover their debts from debtors and their business partners. While some of these recovery methods are permitted under the law, one improper and unlawful way some creditors attempt to recover money owed is by inviting law enforcement agents to arrest their debtors for either stealing or retention of the proceeds of crime in purely commercial or civil matters.
Although the appellate courts have held in numerous decisions that the duty of law enforcement agents does not include acting as debt recovery agents for creditors, we continue to observe cases where law enforcement agents wrongly file a criminal charge against a Defendant in a dispute arising from a purely civil or commercial transaction.
In the recent decision of F.R.N. -v- James Adebayo Ojo (Charge No.: ID/23183C/2023), which was delivered by Honourable Justice Rahman Oshodi of the High Court of Lagos State on Friday, 10 October 2025, his Lordship had the opportunity to address the appropriate instances when a law enforcement agency can file a charge for stealing and retention of proceeds of crime against a Defendant.
Summary of the Facts of F.R.N. -v- James Adebayo Ojo
The prosecution filed a criminal information charging the Defendant with the two offences of stealing and retention of proceeds of crime contrary to section 280 of the Criminal Law of Lagos State and section 17 of the Economic and Financial Crimes Commission (Establishment) Act No. 1 of 2004.
The prosecution’s case was that the Defendant fraudulently presented himself as a businessman trading in oil and gas, and he induced the petitioner, Mrs Memunat Adetona, to invest N19,200,000.00 (Nineteen million, two hundred thousand naira) with him with the understanding that he would pay her a return on investment of N500,000.00 (Five hundred thousand naira) every six weeks. However, when the petitioner requested the return of her funds from the Defendant, he refused. Therefore, the petitioner wrote a petition to the Economic and Financial Crimes Commission (EFCC) to investigate the Defendant for stealing. After concluding its investigation, the prosecution discovered that the Defendant paid the sum of N5,390,000.00 (Five million, three hundred and ninety thousand naira) to Wosbab Energy and N10,887,500.00 (Ten million, eight hundred and eighty-seven thousand, five hundred naira) to DFS Oil and Gas Concept, for the purchase of Premium Motor Spirit (PMS). However, the Defendant diverted the remainder of the funds invested in his business for his personal use.
The Defendant’s case was that he used a substantial part of the sum the petitioner invested with him to buy PMS. However, after selling the products, he did not notify her because the pandemic negatively affected his business operations.
After the prosecution had closed its case against the Defendant, the Defendant’s counsel filed an application for a no case submission, and the court upheld the application on the ground that the prosecution was unable to establish the three ingredients of the offence of stealing against the Defendant. The court identified the ingredients of the offence of stealing as follows: (a) The ownership of the thing stolen; (b) That the thing stolen is capable of being stolen; (c) The fraudulent taking or conversion.
The court also relied on the decision of the Supreme Court in Julius Bayode Ayeni v. The State (2016) LPELR 40105 (SC), where Kekere-Ekun, JSC (now CJN) at Pages 25-26, Para F-B, held as follows:
“The ingredients of the offence of stealing, which must be proved beyond reasonable doubt are: (i) The ownership of the thing stolen (ii) That the thing stolen is capable of being stolen (iii) The fraudulent taking or conversion.”
While the court held that the prosecution successfully established the first two ingredients, it found that the prosecution was unable to establish the fraudulent taking or conversion of the funds because there was evidence that the Defendant deployed a significant portion of the funds for the purchase of PMS. Honourable Justice Rahman Oshodi, at Pages 14-15, Paragraph 26 of the ruling held as follows:
“However, the critical question is whether the prosecution has established, at face value, the essential ingredient of fraudulent taking or conversion. The evidence adduced by the prosecution reveals that the money was transferred to the defendant for the express purpose of investment in oil and gas trading, with an agreed return on investment of N500,000 every six weeks. This is not a case where the defendant simply received money under false pretences with no intention of performing his part of the bargain. Instead, the evidence shows certain sums had indeed been invested in what appears to have been genuine commercial transactions.”
While his Lordship acknowledged that the Defendant did not remit the funds to the petitioner in the ruling, he held that this failure was not sufficient to establish fraudulent taking or conversion. This is how the Court explained its position at Page 15, Paragraph 28 of the judgment:
“The only issue that arises from the evidence is the failure of the defendant to remit the proceeds of the investments to the petitioner. This failure does not necessarily establish, at the outset, fraudulent taking or conversion, which are essential ingredients of the offence of stealing.”
The Court also held that the count on the retention of proceeds of crime was bound to fail since the Defendant was not found guilty of an unlawful activity from which he could be said to have retained any proceeds of crime.
After reviewing the evidence presented by the prosecution, the Court held that it found no prima facie established against the Defendant, warranting him to enter his defence, and it discharged the Defendant on the two counts of stealing and retention of the proceeds of crime.
Takeaway from the High Court’s Ruling in F.R.N. -v- James Adebayo Ojo
From the High Court’s ruling, we can deduce the following:
- A Court would only convict a Defendant for stealing if the prosecution can establish the following three ingredients of the offence of stealing: (a) the ownership of the thing stolen; (b) that the thing stolen is capable of being stolen; (c) the fraudulent taking or conversion.
- Creditors should exercise caution before involving law enforcement agents in commercial disputes. Where evidence shows that the debtor deployed the funds for the agreed business purpose, the dispute will be regarded as a commercial one and not a criminal act of stealing or fraudulent conversion.
- The failure or inability of a businessman to remit the return on investment to an investor is not enough to establish fraudulent taking or conversion of the investor’s funds.
- Law enforcement agents should not always be in a hurry to charge matters arising from a purely commercial transaction to the Court without first thoroughly establishing the essential elements of a crime such as fraudulent taking or conversion.
Please note that this article is for general information only. We do not offer it as advice on any particular matter, whether legal, procedural or otherwise. If you have questions about this article, please contact the author at foa@abdu-salaamabbasandco.com.