SEC Warns Fund Managers On Holding Client’s Funds, Securities

The Securities and Exchange Commission(SEC) has warned some fund managers still in the habit of holding on to client’s funds and securities to desist from the act or face the wrath of the apex regulator.

Director-general of SEC, Mr. Lamido Yuguda stated this at the Post Capital Market Committee Press Briefing held in Lagos at the weekend.

Yuguda noted that holding on to clients’ funds and securities is a clear violation of the Commission’s Consolidated Rule.

Fund managers were reminded that all funds and securities of clients being managed by their firms must be vested with the custodians.

The SEC DG also drew the attention of Fund Managers to issues that arose from the commission’s recently concluded inspection of Fund/Portfolio Management operations whereby several Fund Managers managing discretionary and non-discretionary products and portfolios were yet to seek a ‘No Objection’ of their products and portfolios from the Commission, which is a violation of the Commission’s Rules, noting that, this was also a violation of the Commission’s rules.

The SEC DG disclosed that the meeting also emphasised the increasing importance of Fintech, Sustainable Finance, Financial Inclusion and non-interest finance, adding that, the executive management team of the SEC reiterated its commitment to continue creating awareness, imparting knowledge and engendering public participation in these topical areas.