The Securities and Exchange Commission, SEC, announced that it will restrain fintech startup, Chaka Technologies Limited, and its promoters from advertising or offering for sale shares, stock or other securities of companies or other entities.
This was disclosed in a statement by the SEC on Saturday evening. SEC said its Investments and Securities Tribunal (IST) gave an interim order on Thursday, 17th December 2020.
SEC said the interim order applies to all Chaka platforms, citing that the startup carried out operations outside the regulatory purview of the Commission and without requisite registration.
The interim Orders, which apply to all Chaka platforms, were granted pursuant to an application by the Securities and Exchange Commission.
In the application, the Commission – through its solicitor, Dr. Chuka Agbu, SAN – informed the Tribunal that the Defendants were engaged in investment activities, including providing a platform for the purchase of shares in foreign companies such as Google, Amazon and Alibaba.
The Commission also stated that the said activities were carried out by the Defendants outside the regulatory purview of the Commission and without requisite registration, as stipulated by the Investment and Securities Act 2007.
SEC said the Interim order is to ensure Chaka’s operations are regulated by law to protect investors interest.
“As disclosed in the processes filed by the Commission, the objective of the proceedings is to ensure that all investment activities and market players are duly regulated by the Commission, in line with the requirements of the law. The Commission is concerned that without proper regulation, the genuine aspirations of market innovators and investors could be subverted through the activities of unscrupulous actors, who would try to exploit the growing popularity of Fintech investment options, to the detriment of the investing public. Further proceedings before the Tribunal have been adjourned to January 15, 2021.”
Nairametrics had an interview with Chaka CEO, Tosin Osibodu, where he explained how investing in foreign stocks is made easy through Chaka’s platform.
Nairametrics also reported that the New York Stock Exchange (NYSE) has about 2,800 companies listed, while the NASDAQ has about 3,300 stocks listed, which gives investors in Nigerian market numerous options, where they can put their money, using applications to use like Trove, Bamboo, and Chaka.