SEC Warns Market Operators against Unethical Practices

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Ndubuisi Francis in Abuja

The Securities and Exchange Commission (SEC), has warned some capital market operators to refrain from unethical conducts capable of leading to strict regulatory actions in tandem with the rules and regulations of the Commission.

SEC, in a statement on Monday, said its attention was drawn to an emerging trend of unethical conduct by brokers, issuing houses/book runners and other receiving sgents in primary and secondary market transactions. To

The Commission said the concerned operators carry out their activities by inducing investment through the sharing of brokerage fees or receiving agents commission with private banking officers, asset/fund managers, pension fund administrators (PFA’s and other institutional investor classes who are not duly registered or recognised by it as being eligible to be paid commission.

“Notice is hereby issued that only capital market operators duly registered by the Commission are eligible to be paid brokerage fee/receiving agents’ commission and such Operators shall not pay or offer a percentage of the commission earned from services provided in a transaction as an incentive for investment.

“Any capital market operator found to engage in this practice or similar acts shall be subject to strict regulatory actions in accordance with the rules and regulations of the Commission,” the statement said .

It therefore enjoined the public to utilise the Commission’s whistle blowing mechanism to provide information on any known or suspected case for necessary action.