The Kano State Government has set up an executive committee to recover N1.8 billion.
The money was allegedly deducted illegally from civil servants’ salaries by private loan vendors.
The government has also suspended all new loan contracts between workers and private vendors.
It further announced that it will no longer act as a third party in such agreements.
The 12-member committee was inaugurated on Thursday.
The inauguration was carried out by the Secretary to the State Government, Alhaji Umar Faruq Ibrahim.
According to him, an independent audit uncovered the unauthorized deductions.
The audit found that some vendors made arbitrary deductions from workers who had taken soft loans.
It also revealed that multiple deductions were made beyond the legal one-third salary limit.
This practice violates existing regulations governing salary deductions.
The State Executive Council has approved the audit report.
The council directed the committee to identify all affected workers, both living and deceased.
Refunds will be made to the beneficiaries once identification is completed.
The committee is chaired by the Commissioner for Finance, Dr. Ismaila Aliyu Danmaraya.
Alhaji Ibrahim also addressed earlier claims about missing funds.
He clarified that N1.5 billion was not missing under the former Head of Service, Alhaji Abdullahi Musa.
The audit exonerated Musa of any misappropriation.
It confirmed that the actual amount illegally deducted by vendors is N1.8 billion.
The SSG expressed concern over the widespread loan agreements between civil servants and private lenders.
He noted that total liabilities from these facilities have risen to N13 billion.
The government will no longer allow vendors access to the state’s payment system for deductions.
“In February 2025, the government received complaints about illegal salary deductions for loan repayments,” Ibrahim said.
The complaints were presented to the State Executive Council in a memo, which was approved.
An independent audit firm was then engaged to investigate the matter.
The firm later submitted its findings to the council.
The report showed that vendors made arbitrary deductions in the name of loan repayments.
It also found that workers were granted multiple loans beyond the one-third salary limit.
Upon receiving the report, the council directed the formation of a recovery committee.
The committee’s mandate is to recover the illegal deductions and refund affected workers.
Other members of the committee include the state Attorney General and Commissioner for Justice.
The Head of Civil Service and the Accountant General are also on the panel.
The Chairman of the State Standing Committee is included in the membership.
The Chairman of the Local Governments Standing Committee will also serve.
The Director of the Computer Center is part of the team.
The Permanent Secretary, Establishment, will act as the committee’s secretary.
Other members are the Principal Assistant Secretary (REPA) and the Commissioner for Livestock.
The Commissioner for Planning and Budget is also listed.
A chartered accountancy firm completes the 12-member committee.
The government said the move is aimed at protecting workers from exploitative lending practices.
It reaffirmed its commitment to upholding financial regulations and workers’ rights.
