The Acting Director-General of the Securities and Exchange Commission (SEC), Mary Uduk, has extended the forbearance for multiple accounts to December 31 2018, SEC’s Capital Market Committee noted that the new date became necessary to encourage many investors to consolidate their multiple subscriptions into one account.
According to a statement issued on Sunday by the commission, Uduk appealed to investors in the capital market that bought shares with different names to regularise their accounts in order to get the benefits of their investments.
“There is absolutely no punishment attached to it; SEC is not punishing anybody. We just want such individuals to come and regularise that transaction between now and December 31, 2018.
“The objective is that it will increase liquidity in the market because the shares are just there; no trading on them. Not only that, the investors cannot claim their dividends too and that increases unclaimed dividend.”
Uduk also noted that the Capital Market Committee meeting agreed that in addition to the physical delivery of annual reports and accounts, the existing pilot exercise of electronic distribution by public companies should continue, while efforts are made to enlighten shareholders and obtain their relevant e-mail addresses.
She said that following the completion of the work by the committee on Minimum Operating Standard; the commission would work with trade group associations to implement the committee’s recommendations.
“We also enjoined trade group associations that are yet to register with the commission to register immediately, while the capital market operators are expected to register with their respective trade group associations on or before December 31, 2018, and devised to constitute a market-wide financial technology committee to develop a fintech framework for the Nigerian capital market”.
Recall that last year, the SEC had threatened that investors in the Nigerian capital market with multiple subscriptions for public offers of any quoted company on the Nigerian Stock Exchange (NSE) may forfeit their investments.
Categories of investors with multiple subscriptions
- These include investors who actually existed but joggled their names in different forms to enable them to purchase more than the permitted units of shares on offer.
- Those that did not actually exist but used fictitious names for the purpose of purchasing more than the permitted number of shares during public offers.
The Securities and Exchange Commission (SEC) is the apex regulatory body for Nigerian capital markets. The SEC came into existence in 1979, following a comprehensive review of the Nigerian financial system, with the promulgation of SEC Decree No. 71 of 1979.