FG Moves to Constitute SEC Board

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The Nigerian Securities and Exchange Commission (SEC) building is pictured in Abuja, Nigeria January 23, 2018. REUTERS/Afolabi Sotunde
  • Lijadu tipped as chairman

Goddy Egene

Barring any last-minute change of plan, the federal government will this week, constitute a board for the Securities and Exchange Commission (SEC) to be headed by a lawyer, Mr. Olufemi Lijadu.

The constitution of the board of the regulatory body for the country’s capital market is coming almost five years after the expiration of the last board, and after several calls by stakeholders on the government to do so.

The commission has been without a board and is presently being run by an acting director general and acting executive commissioners, a situation, market watchers said had partially affected the effective regulation of the market.

The commission always relies on the Federal Ministry of Finance for direction in the absence of a board.

However, market sources said given the determination of the federal government in this second term of President Muhammadu Buhari to ensure the capital market plays its role as an economic enabler, the inauguration of a board for SEC has become expedient.

While other members of the proposed board could not be ascertained, THISDAY gathered that Lijadu, who is a partner in the law firm of Ukiri Lijadu & Co has been pencilled in to chair the board.

He heads the banking and finance practice of the law firm.

Lijadu is a leading commercial lawyer with over 30 years’ experience in private practice and in-house.

He recently worked for the federal government as chairman, Presidential Audit Committee on Recovered Public Assets.

Lijadu returned to private practice in 2011 having worked in-house as company secretary and legal adviser, and subsequently, executive director of United Bank of Africa Plc.

He was also a non– executive director of UBA Trustees and First Security Discount House (the first discount house in Nigeria).

He has written several articles on globalisation of legal services and local content development in Nigeria’s oil and gas sector and regularly speaks on these issues on domestic and international platforms.

Lijadu is a fellow and Director of the Aspen Leadership Global Network (West – Africa), and a member of the advisory board of Art X (Art Fair).

He was a member of the presidential committee on the recovery of stolen assets.

He is a Sloan Fellow of London Business School.

Among stakeholders who had called for the constitution of a board for SEC is the Chairman of the Association of Securities Dealing of Houses of Nigeria (ASHON),  Chief Patrick Ezeagu, who had said the federal government should not delay any longer to get a board for SEC.

“We have been calling for a board for SEC without response from the government. SEC, which is regulating a market of several trillions of naira should have a board to enable a smooth running. It is disheartening to know that most of the laudable projects espoused in the master plan are being affected by lack of a board, which is statutorily mandated to take some major decisions in that direction.

“Apart from not having a board, the DG and the commissioners are all in acting capacities. This does not send good signals to investors out there. Appointing a board for the commission and confirming the officers would significantly boost investor confidence, thereby restoring some level of stability to the market,” Ezeagu had said.

The Chairman of Ibadan Zone of Shareholders Association of Nigeria (IZSAN), Mr. Eric Akinduro, said the international community was watching and the more the delay  in the constitution of a board for SEC the more it will affect confidence in the market.

“The apex regulatory authority should be able to show  example to others. If such a thing is happening in SEC now, the best way to handle the situation is for the government to put its board in place so that there can be confidence.  The market is very sensitive. Anything that is not positive can easily drag the market down. Therefore, the best thing for the government is to take proactive step by ensuring that the board is constituted so   that the growth the market is recording now can be sustained,” Akinduro said.

Also, the National Coordinator, Independent Shareholders Association of Nigeria (ISAN), Mr. Adeniyi  Adebisi, had said the shareholders were the ones bearing the brunt of the absence of a board in SEC.

SEC: We Followed Due Process in Oando’s Probe

Meanwhile, SEC yesterday denied all allegations insinuating lack of due and statutory processes in the investigation of Oando Plc.

The commission emphasised that it abided by the fundamental principle of fair hearing in the entire phases of the investigation.

According to a statement signed by the Head of Corporate Communications of the commission, Mrs. Efe Ebelo, “The attention of the SEC has been drawn to various reports questioning the regulatory authority of the SEC, and insinuating lack of due process in the investigations of Oando Plc.

“To put the records straight, the SEC hereby states as follows: Fair hearing is a paramount and fundamental principle, which the commission as a law-abiding agency adheres to in all its investigative processes.

“In the course of the investigations, communications e.g. letters and phone calls were exchanged and meetings held between the commission and Oando Plc, requesting for its comments and explanations on issues relating to the investigations. The findings of the commission were communicated to the Group Chief Executive Officer of Oando Plc by a letter dated July 10, 2017.

“The commission subsequently engaged Deloitte & Touche to conduct a Forensic Audit of the activities of Oando Plc.

“In the course of conducting the audit, Deloitte & Touche held regular sessions with members of the Board and senior management of Oando Plc, and afforded them the opportunity to provide explanations on issues relating to the investigation.

“The commission confirms that Oando Plc was given sufficient opportunity of being heard and accorded several opportunities to rebut the issues revealed by the investigation.”

The SEC explained that the responses given by Oando Plc, were however considered unsatisfactory; prompting, the decision by the commission to penalise the company and some of the individuals related to it for violations of securities laws.

The statement further added: “The actions of the commission were properly effected pursuant to the provisions of the Investments & Securities Act (ISA) 2007 and the SEC Rules and Regulations made pursuant to the ISA 2007.

“These facts have been properly articulated in the court process filed at the Federal High Court by the commission in response to the suit instituted by the Group Chief Executive Officer and Deputy Group Chief Executive Officer of Oando Plc.

“As the Apex Regulator of the Nigerian capital market, the commission has a mandate to protect investors.”

“The commission’s recent action on Oando Plc aligns with the above cardinal mandate, as the directive for the removal of persons from the board of Oando Plc and the appointment of an interim management team to temporarily steer the affairs of the company is to protect investors and preserve stakeholder value.

“Failure or refusal of the commission to act in the face of the serious issues thrown up by the investigations or to reverse its directives, would undermine the federal government’s agenda to build strong institutions and promote the transparency and integrity of the Nigerian capital market, especially given that, these are preconditions for attracting foreign investors to the Nigerian capital market.”