SINGAPORE - Singapore-listed Olam Group said on Feb 19 that a review has turned up no evidence that its Nigerian unit was involved in an alleged multibillion-dollar fraud as reported by media outlets in 2023.

Shares of the agribusiness company surged in response to the news. They rose as much as 17 per cent before closing up 12 cents, or 13.6 per cent, at $1. Trading was heavy, with 10.4 million shares changing hands.

The stock had fallen to its lowest close since 2005 in late October following the fraud allegations, which added to setbacks facing the company, including a profit slump and the delay of the dual listing of its unit Olam Agri.

Olam Group is scheduled to announce full-year earnings on Feb 28.

In September 2023, The Daily Nigerian and Prime Business Africa reported that Nigeria’s secret police were investigating the company’s units, Olam Nigeria and Olam International, and their associate companies for a more than US$50 billion (S$67 billion) foreign exchange fraud.

They also said Olam allegedly funnelled US$34 billion into the Central Bank of Nigeria through its special purpose vehicles as capital importation at official rates, before round-tripping the foreign exchange by selling to other businesses at parallel market rates.

Responding to these allegations in the same month, Olam said references to the sums of US$50 billion and US$34 billion were “manifestly inaccurate and designed to be misleading”.

Its board nonetheless directed the audit and risk committee (ARC) to conduct a review of the matter.

On Feb 19, Olam said its review was led by an investigation team comprising Olam’s ARC, external counsels and independent external accountants.

Work performed by the team – which was approved by the ARC and Olam’s board during the review – did not identify that Olam Nigeria was involved in any of the specific allegations mentioned in the media reports.

“Olam Nigeria has cooperated fully with the Nigerian authorities and assisted in their inquiry. No charges were brought against Olam Nigeria or any of its officers by the Nigerian authorities,” stated Olam.

The group added that all its businesses in Nigeria “continue to operate normally”.

“Olam regards Nigeria as an important part of its future strategic plan, and it will continue to seek future opportunities to grow its business there. Olam will also continue to further strengthen its governance and compliance in Nigeria.”

Shares of Olam ended 0.5 cent, or 0.6 per cent, higher at 88 cents on Feb 16. THE BUSINESS TIMES, BLOOMBERG