By Chinwendu Obienyi
Nigeria’s capital market is yet again embroiled in controversy as shareholders have expressed concerns after market operators accused the Securities and Exchange Commission (SEC) of illegally withholding over N12 billion in investors’ funds in its care for years.
Despite this allegation levelled against the apex market regulator, it is yet to respond, and as a result, this has left investors wondering whether their funds are in safe hands and may yet dwindle their confidence in the capital market.
It will be recalled that the commission had assured investors that their interest will be protected as investors’ protection remains at its heart of its operations.
Speaking during the second quarter (Q2) capital committee meeting (CMC) briefing with newsmen in Abuja via Zoom, the Director General, SEC, Lamido Yuguda, while stating that it is not focusing on majority shareholders alone, said that the SEC’s primary responsibility is to protect the interest of both majority and minority shareholders.
However, that appears far from its word as market operators who spoke to Daily Sun, revealed that the commission is yet to pay shareholders of Dangote Flour Mills their accrued funds for over two years. The operators who craved for anonymity, stated that despite shareholders making several appeals to the commission, it has remained silent.
In 2019, Dangote Flour Mills was acquired by Crown Flour Mills and under the terms of the acquisition, shareholders were to be paid the sum of N24 for every share of Dangote Flour Mills held. Under the terms of the scheme of arrangements of the acquisition the registrars, EDC Registrars Limited, was to pay the shareholders ab initio, and with a clause that all uncollected monies by shareholders should be transferred to the national investors protection funds by the registrars.
The national investors protection funds was established by SEC in 2017 and they are to manage the monies. Since 2021, however, when the unclaimed money was transferred by EDC to SEC, shareholders who held shares of Dangote Flour Mills, have had excruciating difficulties in getting paid by SEC from the national investors protection funds”, he said.
According to him, many shareholders have written series of letters and made calls to registrar and SEC but all to no avail despite several assurances. He pleaded that hapless and innocent investors be paid all payments due to them.
“By its positioning, SEC should be the one offering succour and confidence to investors not the other way round,” he said.
Several efforts to get SEC to respond to this allegation has yielded no results as the commission has remained mute so far.
Reacting to this development, the National Coordinator, Progressive Shareholders Association of Nigeria, Boniface Okezie, whilst stating that shareholders are in the dark due to spare of delistings ongoing in the nation’s bourse, noted that the current board at SEC seems bereft of ideas ans strategies of what to do to tackling the menace of delistings and the accusations from market operators.
Okezie said, “We have regulators who have gone to sleep and that is the problem; the regulators should fight for shareholders of those companies and know what is going on”.