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SEC pledges to boost monitoring and enforcement of rules

By Peter Egwuatu
FOLLOWING the lessons learnt from the crash of the Nigerian capital market in 2008, Securities and Exchange Commission (SEC) has pledged to intensify efforts to monitor and enforce its rules on market operators in the year 2010.

Speaking to newsmen at the end of 2009, Acting Director General of the Commission, Ms Daisy Ekineh said that the SEC  in 2009 focused its priorities on monitoring and enforcement to ensure a safer, more transparent and efficient capital market.

According to her, “ To achieve this, the Commission intensified efforts to improve the efficiency of market regulation and supervision as laws and rules are as efficient as their enforcement. This included the adoption of zero tolerance on market infractions which has reduced new cases in the market, implying that operators now conform with the rules than they previously did. The Commission suspended a number of operators/participants from market activities during the year while a few were referred to the Economic and Financial Crimes Commission (EFFC).

As a matter of fact, in the last 20 months, various enforcement actions including suspension from participating in capital market activities were taken against over 77 operators. Suspensions are usually posted on the Commission’s website – We believe that naming and shaming is one of the most effective deterrence to rule breaches.”

She further disclosed that the SEC Lagos Zonal Office has been electronically connected to the Nigerian Stock Exchange (NSE).
According to her, “ This is to enable the Commission monitor trading on the floor of the Nigerian Stock Exchange (NSE) , on-line real-time, from Lagos Zonal Office. The implementation of SMART surveillance system is also in progress. With its trigger and analytical capabilities, the application will enable efficient and effective monitoring of trading on the NSE by the SEC.

The Commission’s electronic filing and on-line registration management system (eFORMS) has been developed and presently hosted on the internet. It is to be formally exposed to the market by January 15, 2010.”

In the area of transparency and disclosure, Ekineh disclosed that new rules on reporting of companies results has been formulated and would be pursued vigorously in 2010.

In her words, “You will agree with me that the importance of transparency and disclosure cannot be over emphasized in enthroning good corporate governance in public companies. The public want to believe the information they are given by companies.

“As is well known, financial information is the barometer of the state of health of business entity and should be timely, accurate and reliable if it is to be useful for investors. Unfortunately, periodic information, particularly quarterly reporting by some public companies do not carry adequate information to properly guide investment decision. To correct this, and provide the public with more detailed information, the Commission has formulated new rules on quarterly reporting. The rule among others shall require a public Company to prepare its quarterly report in accordance with SAS 30 and IAS 34.”


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