In January 2012, Lawan chaired the House of Representatives committee that investigated the Nigerian government’s fuel subsidies. The committee was set up in the wake of nationwide strikes in Nigeria after President Goodluck Jonathan removed a fuel subsidy. This resulted in the increase in price of fuel.
The committee’s report released in April the same year revealed a huge scam in which Nigerian fuel companies were being paid hundreds of millions of dollars in subsidies by the government for fuel that was never delivered. It was estimated the scam cost the country $6.8 billion.
Business tycoon, Femi Otedola accused the former House of Representatives’ member of accepting a $500,000 bribe as part of a $3m demand to remove his company, Zenon Petroleum and Gas Limited from the list of oil companies allegedly involved in fuel subsidy fraud.
The $500,000 bribe was allegedly received by Lawan from Otedola in a sting operation involving the State Security Service (SSS).
Justice Angela Otaluka of the FCT High Court on 22/06/2021, found him guilty on three counts of bribery and corruption, then subsequently sentenced him to 7 years imprisonment.
Lawan, a four-term member (1999-2015) representing Bagwai/Shanono Federal Constituency of Kano State, approached the Appeal Court who affirmed the verdict of the trial Court but reduced his sentence to 5 years.
In January 2024, the Supreme Court affirmed the five-year jail term handed to Lawan by the Court of Appeal.