A UK High Court has blocked the Federal Republic of Nigeria from appealing the court’s decision last month to dismiss its $1.7bn (£1.4bn) claim against JP Morgan, over claims the bank acted negligently by paying $875m into a bank account linked to a convicted money launderer.
The High Court said Nigeria had “no real prospect” of overturning the ruling, after Nigeria sued JP Morgan for transferring millions to a company owned by Nigeria’s former oil minister Dan Etete, after he was found guilty money laundering in 2007.
Nigeria said JP Morgan missed “red flags” in transferring the funds to a bank account linked to Etete’s Malabu Oil and Gas company, as the country claimed the millions were later siphoned off to the ex-petroleum minister’s “cronies”.
The payments came in the midst of a long-running dispute over the ownership of Nigeria’s OPL 245 oilfield, after European oil majors Eni and Shell agreed to buy the resource from the Nigerian government in 2011.
Nigeria later claimed JP Morgan had breached its “Quincecare” duties, that require it to disregard any customer instructions that might result in fraud, after funds paid by Eni and Shell to the Nigerian government were transferred to an account linked to Etete’s Malabu Oil and Gas company.
JP Morgan refused to comment. Lawyers acting on behalf of Nigeria also declined to comment.