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Accuses FG of breaching property right
From Chukwuma Umeorah
The Independent Shareholders Association of Nigeria (ISAN) has strongly condemned the recently passed legislation by the National Assembly mandating the transfer of all unclaimed dividends from company registrars to accounts managed by the Securities and Exchange Commission (SEC) under the custody of the Central Bank of Nigeria (CBN).
In a statement signed by its National Coordinator, Moses Igbrude, ISAN described the move as a gross violation of property rights and an affront to investor protection. They accused the federal government of indirectly expropriating investor funds. The shareholders’ group warned that such a policy sets a dangerous precedent capable of undermining confidence in the Nigerian capital market.
Igbrude noted, “Unclaimed dividends are not government revenue. They remain the legal property of individual investors and their heirs, regardless of the time elapsed. The attempt to centralise and manage these funds under SEC control is a form of indirect expropriation.”
He further argued that the law, passed without adequate consultation with shareholders and capital market stakeholders, disregards due process and violates the principle of participatory governance. The group said the government’s decision to move forward with such legislation suggests a growing trend of state overreach into private capital.
“This law will shake investor confidence in Nigeria’s capital markets. Local and international investors need assurance that their returns will be protected, not confiscated under state pretexts.”
The shareholders’ association also criticised the absence of transparency in the management framework proposed by the SEC, warning that without a clear mechanism for claims, accountability, or returns to rightful owners, the policy risks becoming an avenue for bureaucratic inefficiency and potential corruption.
“There are no clear frameworks for how the SEC intends to manage these funds, what returns will be offered to rightful owners, or how and when claims will be honoured,” Igbrude noted. “This is a recipe for bureaucratic mismanagement and corruption.”
In addition, ISAN said the legislation could inadvertently harm financial inclusion efforts, particularly among rural and elderly investors who already face difficulties in reclaiming dividends. According to them, the law would introduce a new layer of opacity and complexity instead of simplifying the claims process.
“Instead of simplifying the claim process for unclaimed dividends, this law adds another layer of opacity and complexity, especially for rural and ageing investors who already face hurdles in reclaiming dividends,” ISAN warned.
Calling for immediate intervention, ISAN urged President Bola Tinubu not to assent to the legislation, and if already signed into law, to suspend its implementation pending judicial review. It also revealed that legal action is underway to challenge the law’s constitutionality.
“We call on President Bola Ahmed Tinubu not to assent to this law. If already signed, we demand an immediate suspension pending judicial review,” the statement said. “ISAN is mobilising legal resources to challenge this law in court as unconstitutional, unjust, and economically detrimental.”
Rather than confiscate unclaimed dividends, ISAN proposed a reform-based approach that emphasises technological upgrades, public education, and process standardisation at the registrar level. According to the group, such measures would better address the issue of unclaimed dividends without infringing on investors’ rights.
“We sue for reform, not confiscation,” the shareholders said. “We propose that efforts should focus on reforming the claims process at the registrar level through technology, public education, and standardisation, not through centralisation and state seizure.”
ISAN urged Nigerians to resist what it described as an injustice, insisting that dividends are earned rights and not fallback options for government financing.
“We call on all shareholders to join us in rejecting this injustice. Your dividends are your right, not a government fallback fund.”