BY NKIRUKA NNOROM

As criticisms continue to mount over the Securities and Exchange Commission (SEC)’s decision to direct registrars to stop forwarding dividend warrants to shareholders that fail to give their bank details to them, some shareholders have said that they will take legal action against any registrar or quoted company that dares to implement the directive.

They noted that SEC needs to step up its enlightenment campaign to encourage those that are still foot-dragging to embrace e-dividend, instead of taking a pound of flesh off innocent shareholders over her fracas with the National Assembly members.

Reacting, Mr. Boniface Okezie, President, Progressive Shareholders Association of Nigeria, PSAN, told Vanguard that some institutional investors still prefer to have their dividend posted to them in hard copies.

Though he said that the importance of e-dividend cannot be underestimated, he stated that the SEC does not have the power to direct companies to stop paying dividend to shareholders.

“That directive is better thrown into the dust bin. Nobody should listen to the SEC as far this directive is concerned. In fact, SEC has no power under CAMA to give such order. Any registrar that listens to SEC in this regard is putting itself into trouble, because they are gong to face a lot of litigation from us,” he said.

“The law of CAMA clearly stated that dividends should be sent to shareholders through warrants and that act of CAMA has not been amended. So, until that law is amended, SEC has no right to direct that shareholders should not be paid their dividend. If the SEC Dg wants to amend that section of CAMA, she should go through the National Assembly,” he emphasised.

Also speaking, Sir Sunny Nwosu, National Coordinator, Independent Shareholders Association of Nigeria, ISAN, said, “If that directive is implemented, it will elicit a lot of legal issues from shareholders. Let me say that if that happens, I will sue the company that fails to pay my dividend because I don’t have any business with SEC.

We didn’t buy shares from SEC; we bought shares from companies, so SEC does not have the right to stop dividends from being paid. SEC has no right to make such law.”

“If you go through the calendar of quoted companies, you find out that their annual general meetings fall within May and June, and June 3rd is barely one month from now and SEC is coming out with this directive now. So, whose interest is SEC really protecting,” he queried.

He regretted that all attempts by shareholders to make the apex regulator and the CBN start accepting dividends into savings account has not yielded any result, adding that unless the law that stated that unclaimed dividends becomes status barred after 12 years, is amended, shareholders would resist imposition of sanctions over non-compliance with e-dividend payment requirement.