The Federal High Court in Abuja on Monday began hearing a lawsuit filed by the Osun State Government against the Central Bank of Nigeria (CBN) and the Accountant General of the Federation (AGF) over the alleged mishandling of local government (LG) funds.
Presided over by Justice Emeka Nwite, the case centers on accusations that federal financial authorities are attempting to divert LG allocations intended for Osun into unauthorised private accounts.
In its submissions, the Osun State Government alleged that the CBN and the AGF are working together to channel statutory allocations for local councils into accounts operated by individuals posing as government officials.
According to the state, this would violate both public finance regulations and the 1999 Constitution, particularly regarding fiscal transparency and accountability.
The state also claimed that the disbursement scheme is being executed without the involvement of legally designated accounting officers, a practice it described as both illegal and an affront to due process.
Osun State further argued that the alleged actions of the CBN and AGF are an attempt to preempt and undermine pending proceedings before the Supreme Court regarding the constitutionality and legality of the administration of local government funds in the state.
This development follows ongoing political tensions between elected officials from the All Progressives Congress (APC) and the ruling Peoples Democratic Party (PDP) in Osun, stemming from disputes over the October 2022 local government elections and subsequent conflicting court rulings.
The case raises significant constitutional questions about fiscal federalism, local government autonomy and the limits of executive power in handling public funds.
The court has adjourned the matter for further hearing, with both parties expected to present additional arguments.
