The director-general of the Securities and Exchange Commission (SEC), Lamido Yuguda in an interview with OLUSHOLA BELLO, says the commission is committed to deepening the commodities trading ecosystem in Nigeria.
Ponzi schemes are springing up every day. What is your Commission doing to stem the tide?
The Commission has adopted a variety of measures, including putting up the list of authorized capital market operators on our website, so that any interested investor will check on our website to confirm whether or not the scheme they intend to invest in is truly a registered operator by the SEC.
Unfortunately, many of the Ponzi schemes’ operators once they give the mouth-watering promises, they entice so many valuable investors and, in the end, money is actually lost and these investors start running to our offices to complain. The Commission is sustaining its campaign against illegal operators in the capital market, especially those promoting ponzi schemes, and has adopted multi-level engagements with media platforms and regulators of publicity agencies in order to curb the activities of these illegal operators.
While we continue our activities to resolve the complaints that have been forwarded to the Commission through the official channels, it is important to reiterate to the investing public to be wary of unscrupulous schemes that promise unrealistic returns on investment. This is a continuous fight; we are not resting on our oars on this and we also urge the media to help in disseminating this information.
What efforts has the Commission made in deepening the commodities trading ecosystem?
We are encouraging investments in the commodities space and we are collaborating with the Standard Organization of Nigeria (SON), the National Insurance Commission, the Federal Ministry of Trade and Investment and Federal Ministry of Mines and Steel Development, amongst other strategic partners, in this drive. All of these engagements are with a view to encouraging investments in this massive area where Nigeria has a comparative advantage over many other countries.
As part of measures to deepen the commodities ecosystem, the Commission held engagements with the National Insurance Commission (NAICOM) towards de-risking and insuring certain commodity assets, which we believe, will attract more investments within the space, particularly from the pensions industry. A technical committee, comprising representatives of the Commission, SON, AFEX, Lagos Commodities and Futures Exchange (LCFE) & Nigerian Commodities Exchange (NCX) was also constituted to deliver agro-based standards within three months.
Can we have an update on the current figure of mandated accounts?
From the inception of the e-dividend portal which was in 2016 to July 2021, the total mandated and approved accounts is 1,144,970. This is at July 2021. That is the total number of mandated accounts. The issue of COVID-19 from last year has affected the registration.
What is the situation of the unclaimed dividend now?
The truth of the matter is that we have problems with identity management in the Nigerian Capital Market and this is one of the things that the Commission has been trying to resolve. In June 2021 the Commission constituted a Committee on Identity Management for the Nigerian Capital Market. The committee is chaired by Mr. Aigboje Aig-Imoukhuede and is expected to harmonize various databases of investors, and facilitate data accuracy in the market.
We are optimistic that the outcome of this committee’s assignment would address the challenges of identity management and help resolve some of the issues we face in the areas of unclaimed dividend, direct cash settlement and multiple subscription. There are people who have bought shares under false names before which is what we refer to as multiple subscriptions problem.
Most of the things became an issue after the introduction of BVN, because BVN is tied to only one name. if you have another name that you were using before then, no account will be opened for you and those accounts cannot be accepted by your bankers. Only God knows now how many bank accounts at the bank cannot be connected to BVN simply because they cannot be traceable to the owners.
Consequently, the registration portal was extended till August 31, 2021. This was to enable operators that were yet to update their information with the Commission do so before the end of the new deadline.
What are other measures taken by SEC to reduce unclaimed dividend?
As part of measures to increase the number of mandated investors on the e-DMMS and reduce the quantum of unclaimed dividends, members of the CMC adopted the following measures: automation for mandating to e-DMMS; increase monitoring of adherence to procedures; increase awareness campaigns on the initiative; a training session to be organized by the Central Securities Clearing System (CSCS); who will be supported by the e-DMMS technical committee, institute of Capital Market Registrars (ICMR) and Association of Securities Dealing Houses of Nigeria (ASHON); conduct of a study to determine the suitability of the CSCS to process dividends of investors in unlisted companies.