The Kano State Government has set up an executive committee to recover about N1.8 billion allegedly deducted unlawfully from the salaries of civil servants by private loan vendors.
The government also ordered the immediate suspension of all new loan agreements between civil servants and private lending companies, and announced that it will no longer act as a third-party facilitator in such transactions.
While inaugurating a 12-member recovery committee in Kano, the Secretary to the State Government (SSG), Alhaji Umar Faruq Ibrahim, said an independent audit revealed widespread irregular deductions from workers who accessed soft loans.
According to him, the audit showed that some loan vendors exceeded the legally approved one-third salary deduction limit, carrying out multiple and unauthorized deductions from workers’ wages.
He explained that the State Executive Council approved the audit findings and mandated the committee—headed by the Commissioner for Finance, Dr. Ismaila Aliyu Danmaraya—to identify affected workers, including deceased and active staff, for possible refunds.
The SSG also clarified earlier reports alleging missing funds under a former Head of Service, stating that the audit exonerated the official and confirmed that the actual illegal deductions amounted to N1.8 billion, not N1.5 billion as earlier speculated.
The state government further disclosed that total liabilities linked to such loan arrangements could be as high as N13 billion, describing the situation as a serious financial concern.
Officials blamed the crisis on unchecked agreements between civil servants and private loan vendors, which allowed excessive deductions outside regulatory limits.
The committee includes top government officials such as the Attorney General, Head of Civil Service, Accountant General, and representatives from finance, budgeting, and auditing bodies.
Authorities say the government will now tighten controls to prevent further exploitation of workers and ensure recovery of all illegally deducted funds.
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