Osman Shahenshah, 56, former Chief Executive Officer (CEO) of Afren plc, was on Monday sentenced to 16 years in prison. Also sentenced — this time to 14 years in prison — was Shahid Ullah, the 59-nine-year-old former COO.

The duo tricked the Afren board into investing $300 million in a deal in Nigeria, without disclosing that the partner, Oriental Energy Resources Ltd, would kick back $45 million to a Caribbean shell company they controlled.

Shahenshah and Ullah used some of the money to buy luxury properties in Mustique and the British Virgin Islands, and split the rest with some of Afren’s and the partner’s employees.

Before Monday’s sentencing, a jury at Southwark Crown Court convicted them last week after a six-week trial of one count of fraud by abuse of position and two charges of money laundering.

Shahenshah and Ullah arranged the $45 million kickback after Afren shareholders rejected their £6.6 million ($8.5 million) and £3.8 million ($4.9 million) salary packages in 2013.

Lisa Osofsky, Director of Afren’s Serious Fraud Office (SFO), said the US Justice Department “greatly assisted with our investigation”. An internal investigation at Afren uncovered the fraud in 2014. The SFO started a criminal investigation in June 2015.

Mohammed Indimi, a former in-law of former Military President Ibrahim Babangida and a current in-law of President Muhammadu Buhari, founded Oriental Energy, the Nigerian company with which Shahenshah and Ullah arranged the kickback, in 1990. He has been the Chairman since. He also owns a major share in Afren.

Indimi’s Oriental was awarded an Oil Prospecting Licence (OPL) 224 by the regime of former military President, General Ibrahim Babangida (rtd). From 1991 to 1994, it entered a Technical Service Agreement (TSA) with DuPont Nigeria Limited (Conoco oil) for its activities. Its OPL 224 was converted to Oil Mining Licence (OML) 115.

Later in 2008, Oriental entered into a Technical Service Agreement with Afren Energy Resources to appraise the Ebok Field. Oriental Energy and Afren Energy preserved and worked on the Ebok Field and by 2012, Afren had transformed from a London penny stock to an Africa-focused power house worth £2billion, thanks to the Ebok Field.

Afren gradually started spreading to other counties in Africa and the Middle East, such as Congo, Cote d’ ivore, Ghana, Kenya, Madagascar, Seychelles, South Africa, Tanzania, Ethopia and Iraq.

Following the recession and its attendant crash in global oil prices, the funds for Oriental Energy’s exploration activities in the Obok Field had dried up. Therefore, Indimi turned to his friends in Afren, Shahenshah and Ullah, for the striking of a deal for Afren to provide a $400million lifeline for Oriental while the Afren executives get 15% of it in return.

In mid-2014, Afren announced that the law firm of Willkie Farr & Gallagher (UK) LLP had completed its independent review into the receipt of unauthorised payments by members of management and senior employees.

“In connection with the conclusion of this review, the company has decided to terminate the employment and directorships of Osman Shahenshah and Shahid Ullah with immediate effect,” the company said in a statement published on its website.

The investigators added: “WFG has concluded that in October 2013 Shahenshah and Ullah entered into an agreement with Oriental by which Oriental agreed to pay 15 per cent of the agreed net cash flows that Oriental was due to receive from Ebok for the period 2013 to 2017 to a British Virgin Islands special purpose vehicle, Ntiti Limited, in exchange for facilitating $400m in funding by Afren to Oriental,” the WFG stated.

“Shahenshah and Ullah, with assistance from Afren’s former Nigeria Business Development Manager, Faiz Imam, used the funds in part to pay extraordinary bonuses to themselves ($17.1m in total was paid to Shahenshah and Ullah), and to other selected employees of Afren,” it further said.

In the review, 11 employees — past and present — were found to have benefited from payments from Oriental Energy. Afren also sacked Associate Directors, Iain Wright and Galib Virani, saying they received payments in breach of the company’s approved remuneration policy and that it would seek to recover such sums.

“The Board has instructed counsel to commence legal proceedings against Shahenshah and Ullah, if necessary, to recover sums in respect of such unauthorised payments,” the statement added.

“Greed motivated this crime. Osman Shahenshah and Shahid Ullah failed in their duties as company directors, abused their positions and lied to their board,” Said SFO’s Osofsky.

“Instead of acting in their company’s best interests, they used Afren like a personal bank account to fund an illicit deal, with no regard for the consequences. Fraud corrodes confidence, undermines trust and damages the reputation of the UK at home and abroad. It is our mission to bring those committing this crime to justice.”

In 2014, boasting a net worth of $670million, Forbes named Indimi the 37th richest company in Africa. His wealth has since plummeted. Similarly, Afren once a FTSE 250 company with a market cap of more than $2.6 billion, is now in administration.

Due to concurrent sentencing, Shahensha will serve up to six years and Ullah up to five years.

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