The Securities and Exchange Commission (SEC) has warned publicly traded companies and capital market registrars to stop making selective dividend payments and distributions.
Mr Lamido Yuguda, Director-General of the Securities and Exchange Commission (SEC), stated this on Saturday at the Institute of Capital Market Registrars (ICMR) 10th Annual Conference, Investiture of Fellows, Induction of Associates, and Annual General Meeting in Lagos.
In his keynote address, Yuguda stated that the commission’s attention had been drawn to the fact that some companies and registrars carry out selective dividend payments and distributions.
He also revealed that some were unwilling to release unclaimed dividends in their custody and used a variety of tricks to keep shareholders from reaping the benefits of the E-DMMS platform.
Yuguda stated that the commission would not hesitate to sanction any erring operators in connection with unclaimed dividends or other issues.
“As a result, we urge the ICMR to encourage its members to uphold the Code of Ethics of the profession and as contained in the Commission’s Rules and Regulations,” he said.
Yuguda also bemoaned the fact that the number of mandated accounts had been declining for some time.
“Unfortunately, the number of mandated accounts has been declining for some time, and the rate at which investors are coming forward to conduct their KYC is not encouraging.”
“I urge the ICMR and its members to do everything possible to address some of these issues,” Yuguda added.
According to him, operators have a responsibility to maintain the integrity of the capital market in order to foster investor confidence.
Investors, he claims, are the most valuable assets in the capital market.
Yuguda emphasized the importance of collaboration between the ICMR and the SEC in order to capitalize on the opportunities provided by digital technology.
He stated that this would help to resolve the lingering issues in the Nigerian capital market regarding unclaimed dividends.
On the topic of “Reinventing the Nigerian Capital Market for Growth: The Digital Technology Approach,” he stated that the commission would continue to engage with all stakeholders on new developments in the digital technology space.
“I believe we all have a shared interest in not only seeing these opportunities realized, but also in mitigating the risks so that we can all reap the benefits.”
“As you are aware, the SEC has committed resources to putting in place several measures to address the issues of unclaimed dividend,” Yuguda said. “Despite this commitment of resources, the issues persist.”
He stated that the commission had taken a three-pronged approach to regulating digital innovation: safety, market deepening, and problem resolution.
According to Yuguda, the SEC will continue to ensure that intermediaries use digital technology to better serve the needs of investors in all aspects of the capital market.
He stated that the commission recognized that if the application of digital technology to financial market practices is not properly regulated, it may result in outcomes that undermine investor confidence.
According to Yuguda, the SEC will continue to ensure that intermediaries use digital technology to better serve the needs of investors in all aspects of the capital market.
Mr Seyi Owoturo, President & Chairman of Council, ICMR
, stated in his welcome address that the COVID-19 crisis prompted a digital transformation in the way companies in all sectors and regions conduct business.
According to Owoturo, the goal was to ensure that the new combinations of talent and technology deliver significant advances and value in investor experience and operational efficiency.
“We anticipate that digital technology will have a positive impact on streamlining processes, harnessing data, and shaping entirely new business models.”
“It is expected that the outcome of this conference will reposition the Nigerian capital market for growth by creating a capital market that is appealing to investors and capable of supporting the long-term investment needs of the economy’s private and public sectors.”
“We are confident that the conference’s discourse will galvanize the drive toward repositioning the Nigerian capital market for sustainable growth by addressing the scourge of unclaimed dividends, the need for shared market infrastructure, and the changing role of regulators,” he said.
Mr. John Obaro, Managing Director/Chief Executive Officer of SystemSpecs Ltd., spoke about exploring digital innovations to address the country’s unclaimed dividend problem.
He stated that technology could be used to enable new modes of operation, boost productivity, and improve collaboration and partnership, among other things.
Obaro stated that in order to find a long-term solution to the unclaimed dividend problem, legislation and guidelines should be studied, as current laws do not motivate industry players to seek a resolution aggressively.
He went on to say that laws should be passed and guidelines issued to put the customer at the center of the benefits of investments, and that there should be automation of a properly integrated system.
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