Heineken reached a million settlement last year in a fraud case in Nigeria. CEO Nico Vervelde was suspended for up to seven years in prison for abusing power, but he was promoted to Singapore. The case is not isolated.
‘I’m having a good time in Nigeria. I love an international environment and work in a different culture, “says Nico Vervelde. It is February 6, 2017 and Heineken’s CEO in Nigeria tells Elsevier enthusiastically about his work and life in the largest country in Africa at the Radisson Blu Hotel in his hometown Lagos . He orders a club sandwich with bacon and fries, poses for the photo by the pool and talks about his hobbies: golf and running. No, he says, he will not leave here for the time being. Life smiles towards Vervelde, it seems.
Less than three months later he submits his resignation to Nigerian Breweries, the local subsidiary of Heineken. He left Singapore with a silent drum. What happened?
Nico Vervelde is not the first the best. For Heineken, Nigeria, which is estimated to have more than 200 million inhabitants, is one of the most important nations on earth. At the head office in Amsterdam, people speak of ‘the promised land’. Only in Mexico does the world’s second brewer sell more beer. The Dutch have around two-thirds of the Nigerian beer market and book good profits year in year: more than 200 million euros in top year 2014 and 90 million euros in the difficult 2017. Nevertheless, the expectations for the future are favorable.
What Elsevier does not report is that Vervelde was interviewed one month before the interview at the headquarters of the federal police in Abuja. And there he received considerably more difficult questions. The police want to know everything about a controversial corruption case. His wife is the suspect, he himself is heard as a witness. The Nigerian and international press reports about it, but a sequel stays out.
“I paid and she kicked out the previous supplier”
Until Vervelde (60) unexpectedly submits his resignation at the beginning of May and takes up a non-existent position at Heineken Asia Pacific in Singapore. He does not have a successor at that time, the newspapers report. A former colleague is surprised: ‘Nico wanted to finish his career in Nigeria. He knew he couldn’t get much higher at Heineken at his age. ” No mention is made of the corruption case in the reporting.
The case starts at a jet set party in Lagos in 2013, when oil trader Alhaji Amadu Sule is introduced to Clémentine, a – in his own words – not young, but beautiful woman. She gives him a calling card for her company, Limitless Mind Africa, specialized in the production of musicals, the organization of conferences, artist management ‘ and more“. The latter is not an exaggeration. Clémentine does much more indeed. She is also a consultant, she tells Sule, and has excellent connections. Would he not want to become an oil supplier to Nigerian Breweries? The businessman comes from the Islamic north and his recently deceased father has always forbidden him to go into business with alcohol producers. He himself is less strict in the doctrine. He realizes that there is more at stake than a few barrels of diesel for trucks. Most of the beer brewery’s ten breweries run entirely on generators and slurp millions of liters of oil annually. Of course he is interested!
But what about the public tender? As a listed company and part of a globally operating multinational, Nigerian Breweries applies strict procedures for this type of contract. No worries, Clémentine assures. In exchange for a correct reimbursement, she will take care of everything.
She arranges an appointment with Nico Vervelde, which takes place on the terrace of the Radisson Blu in Lagos, apparently a place where the top man likes to be. Sule is impressed by the energy of Clémentine and leaves a good feeling about the conversation. In his own words he only sees at home that she and Vervelde have the same last name, when he places both business cards next to each other. He finds it rude to make inquiries.
Soon after, Sule is invited to the Verveldes in the residential area of Banana Island , one of the most expensive neighborhoods in the world. Jasper Hamaker is also present, the man who deals with the money at Nigerian Breweries. Sule: “The financial director saw opportunities for me.”
That does not appear to be a big word. With his company TMDK Oil Traders, Sule became supplier of two breweries for three years in the fall of 2013. Moreover, he says he makes an oral appointment with Clémentine Vervelde for another two years. Nigerian Breweries is expected to purchase 3 million liters per month, a deal with a total value of around 61 million dollars. They agree on a first payment of $ 200,000 to be handed over to her in cash. “I paid and she kicked out the previous supplier,” the businessman says.
The joy does not last long. Resentment arises when Nigerian Breweries Sule managers accuse poor-quality oil of causing a fire in one of the breweries. But internal research from the brewery shows that there is nothing wrong with its product. The rumor is circulating that the fire was lit to blacken Sule, the result of internal power games. A further setback for the oil trader is a drastic reduction in the monthly order, due to a partial switch from oil to gas in the breweries.
According to Sule, that is contrary to his agreement with Clémentine Vervelde. In the meantime, she is demanding more and more money. And according to him it doesn’t stop there. “Everyone also had to be bought off at lower levels,” he says.
A Dutch source, a former expat in Nigeria, confirms that bribes are common for suppliers. ‘A guard charges 100 naira [the Nigerian currency, ed. ] At the gate to let you in, at a slightly higher level you pay 1,000 naira and you soon lose a few million naira to get the financial controller to you will be paid. That’s how it works here. ”
The size is full for Sule. His people, the Fulani from the north, are known as proud and stubborn and he comes from an influential family. They got the wrong one.
“Don’t you dare fight Nigerian Breweries”
When the inspector and his colleague ask for another 3 million naira (at the time about 15 thousand euros), he pays, but via the bank, with proof of payment. With this he goes to the management of Nigerian Breweries and the audit department. The company has to respond and does an internal clean-up: both employees leave the avenue and the case is further investigated, which leads to more layoffs. The head office in Amsterdam is also informed and sets up its own investigation.
Still Clémentine Vervelde – nicknamed ‘madame’ – continues to ask Sule money. According to the businessman, the total amount has risen to 878 thousand dollars when he discovers that Nigerian Breweries is exchanging his company for a competitor. According to Sule, this is Forte Oil, a company that is already a supplier to Heineken, but the brewer says it is a different supplier. The two-year extension of the contract that the supplier would have been promised and for which he says he has paid extra commission, is easily ignored by him.
Angry, Sule goes to the villa of the Verveldes, where he tells the man of the house that his wife is playing a game with him. He says he has information that shows that she has also taken money from Forte Oil. According to Sule, Vervelde responds with threats: “Don’t you dare fight Nigerian Breweries,” he said. “Nobody does that, we are too powerful. You had a contract for three years. They are over. You better go quietly. ”
The headquarters of the federal police is located in the Louis Edet House in Abuja, named after the first Nigerian chief of police who took over the police authority from the British in 1964. It is an impressive white building in a neighborhood full of government buildings. The head of state is a few minutes’ drive away, in the Aso Rock Presidential Villa, and the Parliament and Supreme Court are also nearby.
“Whatever you perform, you better watch out”
On January 23, 2017, Clémentine and Nico Vervelde must report to the Criminal Investigation and Intelligence department. This is an elite unit of the Nigerian police force that also deals with the Boko Haram terror movement. Sule has sued Clémentine Vervelde for fraud and his complaint is taken seriously enough. Nico Vervelde is being heard as a witness, along with some other directors and managers of Nigerian Breweries.
The police is your friend is the Nigerian police motto, but that does not apply to the Verveldes at that time. The commissioner ignores phone calls from influential countrymen who, according to an internal source from Heineken, have been called in by the top of the brewing company. They put pressure on the police to drop the case. The lawyer of Nigerian Breweries has, according to the police, repeatedly made threats in the run-up to the interrogation. “This is a big company. Whatever you perform, you better watch out. ” The police are not intimidated and, according to those involved, have a large amount of evidence, among other things because the telephones of the protagonists have been tapped.
Nico Vervelde in particular has a hard time. “After twelve hours of interrogation, he looked terrible, he looked ten years older,” says one present. It was harder to forgo Clémentine Vervelde, but she, too, had a hard time. The same source: “The police commissioner was very handy. He sat quietly behind his desk, on which lay a large pile of paper. He watched his prey like a crocodile. She did not tolerate silence and kept talking. He fed her. Exactly at the right time, he gave her a piece by asking the right question. ”
First Clémentine Vervelde denies everything, but eventually she admits that she has taken money. For others, she says. “In that case I can imagine that it is also in your interest that we investigate this thoroughly,” replies the Commissioner.
“Why did Clémentine Vervelde have an office at the expense of Nigerian Breweries when she was not employed there?”
Relieved, she wants to go home, but it’s not that far yet. First someone must be prepared to guarantee her release, otherwise she will be forced to spend the night in jail. “I fear that the accommodation that we offer here is not of the standard that you are used to,” said the Commissioner. She has to leave her passport because she is considered to be a suspect in flight.
According to several sources, Femi Otedola, CEO of Forte Oil and one of Nigeria’s richest businessmen, stands surety. Nico Vervelde has been a supervisory director since December 2016 on the board of this oil supplier.
It doesn’t come to a lawsuit. Sule agrees with a settlement of more than 2 million dollars, paid by Nigerian Breweries, considerably more than the commissions of just under 9 tonnes that he spent. Heineken decides to do a cleaning at the Nigerian subsidiary. Those directly and indirectly involved lose their jobs or end up on a sideline and Nico Vervelde disappears to Southeast Asia, where he continues his career in August 2017.
An internal source confirms that fiscal tampering is common
According to a source within the police, the Heineken chief may be happy with this outcome. “If it had come to a case, he would also have been charged with abuse of power. Why did Clémentine Vervelde have an office at the expense of Nigerian Breweries when she was not employed there? Abuse of power is a form of corruption that is punishable by imprisonment. The duration depends on the burden of proof: it can be three years, but also seven. ”
In addition, the police in this case also discovered tax evasion by Nigerian Breweries. ‘With every contract of this kind, the tax authorities should pay a percentage. Nigerian Breweries had promised to pay 120 million naira withholding tax on behalf of Sule, but the businessman later discovered that the company had paid only 19 million. That is fraud worth 100 million, “said the same police source. According to the exchange rate of the time, it is almost half a million euros.
An internal source from Heineken in Nigeria confirms that fiscal tampering is common at the subsidiary, but the head office denies that tax evasion exists.
No incident, but a system
“Someone who fits in the store, a decent manager who needs every company,” is how Nico Vervelde is described by a former colleague. “I always thought he was a bit hesitant, a little weak. If you then also a woman have one larger is than life , you become overshadowed. It was unclear who was at the helm, Mr. or Mrs. Vervelde. That doesn’t work in Nigeria. You must always radiate authority there. ”
This former colleague thinks it is strange that Vervelde still works for Heineken. “It’s not the first time that Clémentine has been discredited. He has always maintained that he knew nothing about her activities. We thought that was questionable. I assume there is no Chinese Wall within a marriage. ”
“Nico must have been informed”
“Nico must have been informed,” says a former manager who worked with him a lot. ‘He appears honest and has a good reputation. In the beginning I thought he really knew nothing, that he was naive. But that is not possible. This is too large, too widespread. He’s the boss. ”
According to various sources within Nigerian Breweries, the affair with TDMK Oil Traders is no more than the tip of the iceberg and it is wrong to designate Clémentine Vervelde (with her husband) as the only scapegoat. From conversations with those involved, a picture emerges of several top managers, both Dutch and Nigerians, who pursue all sorts of controversial trades, with the goal of personal enrichment and branches at all levels. An initiate calls the Heineken subsidiary a ‘thoroughly rotten company in which fraud and corruption take place at every level’. He remembers the first cleaning well after Sule had submitted the proof of payment. “It was mostly cosmetic. The top remained in place and the system remained unchanged. Almost everyone shares it, creating a close-knit chain that cannot be broken. ”
Clémentine Vervelde was the most important pivot in this system. “Everyone in the industry knew she was supreme,” says a Nigerian ex-manager. ‘If you wanted something done at Nigerian Breweries, go see Clémentine. ” Whether it was a house for a new expat or plane tickets for a business trip, everything went through her. With her company Limitless Mind Africa, she also regularly organized conferences for Nigerian Breweries, often at the Eko Hotel on the lush Victoria Island in Lagos. Hotel manager and good friend Danny Kioupouroglou gave her a substantial discount, according to insiders, while she actually charged the brewery a substantial additional price. She also got a finger in the door with sponsor contracts, from small cultural events to large TV promotions. A former Nigerian Brewery employee: ‘Then you came to such an event that we sponsored 40 million naira and you had no idea where all that money had gone. The figures were often highly debatable. ”
“The Verveldes have maintained close ties with Heineken’s CEO for at least 20 years”
After the settlement, a number of sponsor contracts were abruptly terminated, with relatively little money involved. A prize for visual artists and a renowned writers’ workshop , set up by best-selling author Chimamanda Ngozi Adichie , did not survive. According to Heineken, this was a cutback, but initiates believe that the involvement of the director’s wife is the real cause. It was time for a clean ship.
Close ties with the Heineken top
Clémentine Vervelde-Murekatete, as it is called in full, is originally Rwandan. She also has good connections and diverse commercial interests in her native country. For example, she refers to Sule as the national airline RwandAir, which connects daily Lagos and the Rwandan capital Kigali, as a potential customer.
In Rwanda she is still the owner of a transport company to this day. A former Heineken CEO said: “According to her, those trucks would get a contract with our brewery there, but the director said: I don’t know anything about that, that’s not how we work. Then Mrs. Vervelde made an incredible stennis there and pushed through to the highest level in Amsterdam. But Nico was not aware of that either. It can’t be that you have a woman who invests in trucks to deliver beer, you are in the beer businness yourself and you don’t talk about it. ” Following the intervention of the board of directors, Clémentine Vervelde was allowed to distribute the crates of beer according to various insiders, which Heineken denies.
Nico Vervelde started his career after studying food sciences in Wageningen. He met his current wife in the early 1990s, when he was appointed marketing director at the local Heineken subsidiary in Rwanda. There he was the direct successor of none other than Jean-François van Boxmeer, Heineken’s CEO since 2005. Several sources around the Verveldes confirm that the couple have maintained close ties with Heineken’s CEO for at least twenty years and in this way ‘protect’ enjoy.
‘The Netherlands is starting to get a nice reputation as the bribery number 1 in Nigeria’
Moreover, a manager in Nigeria noticed how quickly Clémentine Vervelde was aware of this fraud case that was told to the head office in confidence. “Without protection, Nico would no longer have worked for Heineken,” says a former colleague. It is also surprising that initiates have received permission from Van Boxmeer for the supervisory board at supplier Forte Oil. ‘That smells very much of a conflict of interest. That would probably not be possible in the Netherlands, “says a former director in Nigeria.
Has Heineken been guilty of criminal offenses in Nigeria? “This sounds like a classic case of corporate crime, in this case bribery and private corruption,” says Wim Huisman, professor of criminology at VU University Amsterdam. ‘Bribery is often associated with governments, but that is not necessary. It is also punishable between companies. Incidentally, it is not legally forbidden to award contracts to loved ones, but only if a bribe has been paid. ”
According to Joseph Wilde of the Research Foundation for Multinational Enterprises (SOMO), Heineken has in any case violated the OECD guidelines, the standards that multinationals must adhere to. “With these revelations about Heineken, coupled with recent revelations about corruption and bribery by Shell in relation to an offshore oil platform in Nigeria, the Netherlands is starting to gain a good reputation as a bribery number 1 in Nigeria,” he says.
A former expat from Heineken in Nigeria reacts indignantly when he hears this story: “This is all that Heineken does not stand for in my eyes. Everywhere in Nigeria we talk about integritywith large letters and we prohibit drivers from paying the smallest bribes . We want to show that you can function in a climate of fraud without taking part. And now that it concerns the highest level, you as a company try to put that under the carpet. That just can not be.’
Back to February 2017. Shortly after the interview in Elsevier , the annual report of the subsidiary also comes out. On page 27, Nico Vervelde features a tuxedo. His company has been awarded a Corporate Governance Award by the Institute of Directors, a group of leaders in the public and private sectors. The reason? Nigerian Breweries would, like no other, meet the four pillars of good corporate governance: responsibility, transparency, honesty and liability.