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SEC, NSE campaign against fraudulent activities among operators

By Nkiruka Nnorom

Adebayo Adeleke, former General Secretary, Independent Shareholders Association of Nigeria, ISAN

I BELIEVE it is part of the duties of regulators to ensure a free and fair market. Transparency and fair play are essential ingredients for any market. Market operators are also in a position of trust. They must be seen to be above board to retain and sustain the confidence of all stakeholders. But then, our system is still evolving; it is not yet perfect and so is our regulatory environment. I think we should all regulate the regulators but we should still give them benefit of the doubt.

The regulators should use suspension, withdrawal of licences and blacklisting to discourage operators from engaging in fraudulent activities and malpractices. However, despite the use of all the measures listed above, you still find operators engaging in form of malpractice or the other due to greed and exploitation of investors’ ignorance.

Igbrude Moses, ISAN member

RECENTLY, we have been hearing a lot  of fraudulent activities in the market and this came about because one of the victims has the ability to say it, that is why you are hearing it. What of many small investors that cannot speak up.

What this means is the Securities and Exchange Commission, SEC, and the Nigerian Stock Exchange, NSE, are not doing enough judging by their reaction to the recent fraud case. The NSE and SEC should continue to make the steps they are taking to curb malpractices known to the public.

We should continue to let the investing public know all that we are doing such that even when it is small investors are defrauded, the perpetrators are punished so that people should be afraid. What I am saying is that anytime fraud takes place, punishment should pronounced; if the licence of such operator is withdrawn, it should be made known to the public after the withdrawal.

The SEC and NSE should liaise with the Chartered Institute of Stockbrokers, CIS, to withdraw licences of perpetrators; they should not practice again.

Adeniyi Adebisi,  National Coordinator, Independent Shareholders Association of Nigeria

THE issue of fraudulent activities in the market, is too complex. We don’t really know whether the regulators are not doing enough or that the investors are not careful enough.

Apart from the standard system on ground where the Central Securities and Clearing System, CSCS, issues investors alert when there is transaction on their share, and the directive that stockbrokers should separate their account from their clients’ account, I don’t know of any other measure either SEC or NSE is using to check fraud.

But on a general note, we have not been receiving complaints of frauds from our members. It has not been common and personally, I have not had an experience of fraud. Apart from this Partnership Investment Company Plc, I don’t know of any other outstanding case.

Amb. Olufemi Timothy, President, Renaissance Shareholders’ Association

IT is the duty of the Nigerian Stock Exchange and the Securities and Exchange Commission to fight malpractice in the market. It is part of their responsibility, it is a normal thing and that is why they are there. In fact, they should not tolerate infraction in any way.

Considering the recent development involving a stockbroking firm, you cannot take away fraud when you consider the number of operators we have in the capital market. No matter what the regulators do, you are bound to still find one or two people who will still be corrupt and fraudulent.

The best thing is that whenever such people are caught, they should be punished accordingly. That will show that the regulator is performing its duties by punishing anybody who has committed infraction. By the rules and regulations of the SEC and NSE, they should have stated sanction for every offence.

I think the nature of the offence should determine the kind of sanction that will apply. Like share scam, they should either suspend the perpetrator or report the case to the Economic and Financial Crimes Commission, EFCC, and other related criminal agencies to try them. That will be the proper thing to do.

 

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