Trouble in Baseline Music, as Skales, manager remanded for alleged fraud
With his exit from Banky W-led Empire Mates Entertainment (E.M.E), and his release of the single, Shake Body, that became an instant hit in Nigeria, and well accepted across the continent, the singer Raoul John Njeng-Njeng, popularly known as Skales, became a prominent figure in the Nigerian music scene.
Despite the soaring popularity with the hit single, behind the scene, the money wasn’t coming as expected, and in a bid to sustain the growing acceptance, Skales created his own imprint, OHK Entertainment, with all the branding possible, signed up beat maker and music producer, Dreybeatz, while the promotional photos flooded the social media and the Internet with the creative support and supervision of his manager, Teresa Osagie Osarenkhoe, popularly known as Osagie, who had earlier managed Wizkid.
When Howie T and Dipo Abdul-led Baseline Music signed the Man of the Year crooner in 2014, there was air of triumph from his camp, as he was said to have crossed one of the most difficult times of his life. The deal helped him make a statement of comeback after his exit from E.M.E.
The single also launched him into a new phase in his career, and the feeling was ecstatic, as fans, who had cried with him in his dark moments, joined in the celebration of a new deal.
With the deal reportedly worth N200 million signed, the label officially unveiled the rapper on July 22, 2014, at a press conference held at The Wheatbaker Hotel, Ikoyi, Lagos. That deal came with perks, which included a brand new car, a house, cash advance, and upkeep allowance. Skales was also given the freedom to run his label independently.
Details of the deal showed that Skales agreed to relinquish 70 per cent of profits earned from everything. Under the terms of the contract, he assigned to Baseline Music, all copyright and other rights or interests throughout the world in all sound recordings made by him prior to or during the term of the contract.
The contract further provided that the record label shall be entitled to 70 per cent of the gross receipts received by Skales from performances, tours and brand endorsements during the term of the contract. The most shocking part of the deal, although not confirmed from official sources, stated that the termination of the deal is worth £10m.
A snapshot of the clause reads: “The artiste may terminate this agreement prior to the expiration of the contract period by paying the company the sum of £10m.”
This generated outcry on the social media, with many weighing in on the deal, saying the termination fee was too expensive, and outrageously unreasonable.
Crack In Wall
The once sweet relation has gone sour, as Skales and his manager, Osarenkhoe, have been accused of allegedly defrauding the record company to the tune of N13.374 million.
The music label in a press statement titled: ‘Theft of Company Monies Earned by Skales from March — April 2016’ and made public on Thursday June 2, confirmed the arrest of Skales and his manager.
“Osagie (Teresa Osagioduwa Osarenkhoe) was arrested today by the Nigerian Police at the instance of Skales record label, Baseline Records. She was accused of fraudulently diverting N13.3m belonging to the record label for personal purposes,” the statement read.
An insider in the label, who affirmed the news, said the singer and his manager were remanded in Police custody but were released after questioning. The insider noted that at the inception of the contract, Skales was given a fully furnished luxury apartment in Lekki in a gated estate, with a brand new customised SUV, and a multimillion naira sign on fee.
“The label gave him a free hand to select and run his brand, supported by a multimillion naira corporate expense account,” he said.
The label in a petition dated May 19, 2016 and addressed to the Assistant Inspector General of Police, Zone 2 Command, Onikan, Lagos, claimed that Skales introduced Teresa Osagioduwa Osarenkhoe to the label as his manager and stated her duties to include, tour bookings, strategy and promotion.
“By the company’s estimation, from the aforementioned events, Osarenkhoe has fraudulently converted the sum of N7,474,000 from this brief period without accounting to the company or making payments first into the company’s accounts as stipulated in the contract,” the statement read.
The record label noted that though Skales was listed as performing at various concerts, shows, tours and other events, none of the monies received from these events were remitted to the company.
“In this regard, the company invited Skales and his manager, Osarenkhoe, to various meetings seeking account reconciliation. At these meetings, both Skales and his manager insisted that the events in question were not paid events and as such, there were no monies to remit.
“These dubious activities continued for a period of 12 months, wherein the company was fraudulently deprived of its legitimate earnings by the said Osarenkhoe as payments made for performances were paid directly into her account in violation of the procedure set up for payments at the beginning of the Contract,” the statement read.
How the bubble burst
The music label in the statement said that it had in March 2016, decided to catalogue some of the paid shows, performances, concerts and tours wherein Skales performed and the monies were fraudulently converted for personal use by the said Osarenkhoe. It made a list of performances, which only covers the period from March 3 to May 1. This, it stated, is without factoring all the other performances, tours and shows where no remittance was made from the period January 2015 to April 2016.
“In order to properly document this fraud and catch Teresa Osagioduwa Osarenkhoe in the act of theft, the company created an email address, and sent an email to her requesting the performance of Skales at an event in California on the 2nd June, 2016. In the email communication, Teresa Osagioduwa Osarenkhoe requested the sum of $5,000 (five thousand US dollars) for the performance as well as one business class ticket, one economy class ticket and two hotel rooms in a 4-star hotel. Please find enclosed herewith the email communication between Skales and Femi George with respect to the said performance…” the statement read.
The label further explained that on May 18, the first tranche of $2,500, representing 50 per cent of the performance fee demanded by Osarenkhoe was wired into the following account: Bank of America, Name: Teresa Osagioduwa Osarenkhoe; Account Number: 483063945907.
It added that subsequent to the transfer and proof obtained, Samuel Gbemileke Samuel, a staff member of the record label put a call through to Osarenkhoe requesting for an account of all monies received by Skales for performances and tours for the month of May. Osarenkhoe, however, insisted that there had been no paid performances for Skales during the period in question.
In the statement, the company explained that in 2015 it entered into an agreement with Upfront and Personal, for the engagement of Skales to appear in TV commercials, billboards websites and other social media on behalf of MTN Pulse. And as per the terms of the agreement, Upfront and Personal was to pay to Baseline Records the sum of N5,000,000 (five million naira) in two tranches of N2,500,000 each.
“The said Osarenkhoe representing that she was authorised by the company obtained the sum of N5,000,000 (five million naira) due to the company without being so authorised. Teresa Osagioduwa Osarenkhoe has failed after repeated demands to repay the said N5,000,000 (five million naira) fraudulently obtained. Given the above circumstances, the company believes that a fraud had been committed against it by Teresa Osagioduwa Osarenkhoe,” the statement read.
But a source told Weekend Beat that Baseline Music owned by Segun Adebutu, son of popular lotto merchant, Kessington Adebutu has actually not lived up to its contractual agreement. It was gathered that since Howie T and Dipo Abdul left, the label had been enmeshed in some financial mess.
The source said that though the singer and his manager were actually arrested by the Police on Tuesday, May 31, they were released after explaining what transpired between their camp and the new management of the music label.
“Yes, they were arrested on Tuesday, but they were released same day. One thing people don’t know about the whole story is that since Howie T and Dipo Abdul left, the owner of Baseline Music have not been living to their own end of the deal. In March this year, the owner of the label, Segun Adebutu, son of the popular ‘Baba Ijebu’ had a meeting with Skales and Osagie, and he promised to introduce the new management to them, which they are yet to do that as I speak with you,” the source said.
According to the source, in a bid to keep the Skales brand going, the singer had asked his manager keep all monies that come to the brand, pending when the label management will introduce the said new managers.
“Truth is that since Howie and Dipo left, they have not been living to their own bargain of the contract. They don’t remit on time artiste cut of performance fee or any deal the artiste brings by virtue of the contract agreement. Baseline on their part, breached the terms of the contract. It is not that Osagie diverted the money to personal account or used it for personal purpose. Everything she did was on the instruction of Skales; she acted on the directive of Skales,” the source added.