A political dispute has emerged in Osun State after its government accused the Central Bank of Nigeria (CBN) and the Accountant-General of the Federation (AGF) of plotting to divert statutory allocations meant for its 30 local government areas.
The state claims the federal agencies tried to pay these LG funds into private accounts linked to associates of former governor Gboyega Oyetola, an allegation that has set the state and federal institutions on a collision course.
In a statement on Wednesday, Dosu Babatunde, Osun State Commissioner for Local Government and Chieftaincy Affairs, called the move “unconstitutional” and “a blatant breach of Nigeria’s public finance regulations.”
According to him, the state acted quickly upon hearing about the alleged scheme, submitting a formal list of authorized signatories for all 30 LGAs. These signatories, he said, comprise the Heads of Local Government Administration (H.L.A.), Directors of Finance, and Directors of Administration.
But the state claimed the CBN rejected its list. “To our dismay, the Osogbo Branch of the CBN refused to accept the names of authorized signatories we submitted,” Babatunde stated.
“We suspect this was done deliberately to enable the allocation to be paid into private accounts of former governor Oyetola’s associates, regardless of due process.”
The Osun State Government insists that any payments made to unauthorized individuals will be treated as a serious offence. “We will pursue every legal avenue available to ensure accountability,” the statement read.
Meanwhile, the All Progressives Congress (APC) Chair of LG Chairmen, Abiodun Idowu, waved off the claim, saying any legitimate LG payments must pass through authorized channels.
“We understand the implications of public money going into private accounts,” Idowu stated. “Perhaps those making these accusations should verify their facts. Let them look elsewhere.”
The crisis deepened when the Osun chapter of the Nigerian Union of Local Government Employees (NULGE) revealed it had received a letter from the AGF, dated June 10, 2025.
According to the state NULGE president, Dr. Nathaniel Ogungbangbe, the letter announced a new requirement for LGAs to open bank accounts with the CBN Osogbo Branch. The AGF proposed that the accounts be opened by any two officers: the LG Chairman, Treasurer, Director of Finance and Administration, or the Director of Personnel Management.
NULGE rejected this as a ploy to bypass state-authorized signatory protocols. The union emphasized that the only valid signatories for LG accounts are the Director of Finance and Supplies and the Director of Administration and General Services, with the H.L.A. and council chairmen confirming transactions.
“The CBN must adhere to the rule of law,” Ogungbangbe stated. “There is a grand scheme to channel LG allocations into personal accounts of people who are not LG staff. This is illegal and unacceptable.”
Adding to the tension, the Chairman of the Osun State Independent Electoral Commission (OSIEC), Hasim Abioye, asserted that the only legitimate LG authorities are those elected in February 2025. Abioye condemned what he called the “partisan and biased stance” of the AGF and the Inspector General of Police in supporting sacked LG chairmen. “These sacked officials lost in court and have no legal claim to office, yet they now storm LG offices with armed support and share alcohol openly, making a mockery of the system,” Abioye said.
He reaffirmed OSIEC’s commitment to transparency and accountability, urging stakeholders across Nigeria to reject any scheme that threatens the integrity of Osun’s local governance.
As tensions rise, Osun State has called on President Bola Tinubu and the Minister of Finance to intervene and prevent a potential scandal that could further deepen Nigeria’s federal-local tensions.
The state maintains that any LG allocations deposited into unauthorized accounts will have serious consequences, a warning that sets the stage for a legal and political standoff.
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