In order to capture digital transactions in the country, the Securities and Exchange Commission (SEC) is making amendments to its rules. This, the Exchange also believes would combat crime in the capital market.
In a related development, the capital market regulator has signed a pact with the Nigerian Financial Intelligence Unit (NFIU). This is aimed at eradicating suspicious transactions in the capital market.
Speaking during the signing of the MoU between SEC and NFIU, the capital market regulator’s acting Director-General, Mary Uduk, stated that the partnership would enable the closure of ranks in the face of insider dealings, re-awakening of Ponzi schemes, cybercrime and other fraudulent activities that have engulfed the market in the last few years.
Uduk added that the Commission already has regulations that prohibit “shell companies” from operating in the capital market. The acting DG, however, implored the NFIU to assist with solutions that will help track suspicious transactions as they occur.
“If we have solutions that will help us track transactions, it will reduce the incidence of insider dealing greatly. We will be very willing to collaborate with you on that in our determination to ensure that our markets are efficient and transparent and all investors are protected.
“Some areas where the MoU seeks the cooperation of both agencies include training, secondment of middle cadre officers between both organisations, cross-border monitoring, repatriation of stolen funds from the capital market and prosecution of offenders, among others.”
Prior to this development, SEC had issued a notice to announce the commencement of verification exercise for about 4,160 Nigerians who participated in an illegal investment (Ponzi Scheme) organized by Dantata Success and Profitable Company(DSPC).
What it means: The step taken by SEC is a deliberate attempt to clean the capital market and financial sector of any illegal activity that could facilitate the defrauding of Nigerians’ hard-earned money.
- It should be noted that the harsh economic condition in the country often forces many Nigerians into ponzi schemes in a bid to make quick money.
- But despite the bad economy, SEC does not believe ponzi scheme is the solution Nigerians should seek. This is because ponzi schemes come with risks. Moreover, the fact that they do not have the approval of SEC makes them unsafe and illegal.
- This new move by SEC could also place its searchlight firmly on cryptocurrencies and Forex trading. These are two of the most popular investment outlets for young Nigerians.