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…Frowns At Over 4 million Incomplete KYC Account Information
The Securities and Exchange Commission (SEC), has reintroduced a periodic renewal of registration for Capital Market Operators as part of a major supervisory measure at ensuring a capital market devoid of any form of abuse.
Also the Commission which pride itself for zero tolerance on infractions, further reiterated commitment to advance the development and integrity of the Nigerian capital market as a bastion of hope for investors.
The Director General of the SEC, Mr. Lamido Yuguda, who made this remarks while addressing the press at the post Capital Market Committee Meeting press briefing webinar held Thursday, said the commission want to ensure that operators in the market are fit and proper at all times at carrying-out their responsibilities,
“The rationale for this is to ensure that operators in the market are fit and proper at all times and to strengthen the supervision and monitoring activities of the Commission. The renewal process is electronic and the deadline for 2021 renewal is 30th April, 2021.
According to the SEC DG, while the Commission’s directives on investors KYC information update still stand, “We have noted that the level of compliance has been low. Despite several engagements, we realized that as at April 8, 2021, there were still 4,012,311 (Four million, twelve thousand, three hundred and eleven) accounts with incomplete KYC information. This exercise is critical to deepening the participation of retail investors and we direct all CMOs to accord it the highest level of priority.
Speaking on the Capital Market Master Plan (CMMP), which is expected by all stakeholders to revamp and further deepen the value of the market, the SEC DG noted that, the Commission is at the mid-point of implementing the CMMP and has commenced a review to update the assumptions, and align the plan with current realities.
“Similarly, the Commission has released new rules on warehousing, collateral management, crowdfunding, fund management products and nominee companies to ensure proper regulation and development of our market.
On the issue of unclaimed dividend in the market, Mr. Yuguda explained that, “Towards the end of 2020, the Finance Bill was signed into law, which created an Unclaimed Dividend Trust Fund (UFTF). No doubt, this law has implications on the Commission’s initiatives on e-dividend, multiple subscription and identity management. We are currently taking steps to align our activities and initiatives with the provisions of the Act.
“The Commission has observed that certain Capital Market Operators (CMOs) frustrate the e-dividend mandate process. We implore all stakeholders to comply with all directives of the Commission in this regard, as defaulters would be sanctioned appropriately.
“We have observed that the growth in the number of mandated accounts has been on the decline for some time. The Capital market community has directed its e-Dividend Committee to engage with the Committee of Heads of Banking Operations to encourage better cooperation from banks as we tackle the challenges of unclaimed dividends.
“In the same vein, registered CMOs are advised to refrain from providing any form of support to unregistered entities operating unlawfully within our market, as such action would not be condoned. Furthermore, we urge CMOs to improve on their level of compliance, timeliness and correctness of disclosures and other filings made to the Commission.
The SG DG who further assured market players, especially while recognising the role of FinTechs in the growth of the market, of a level playing field, said the Commission will ensure the delivery of safe products and services without stifling innovation.
“I therefore encourage FinTech firms to approach the Commission for due registration and desist from operating illegally.
The Commission which said it will constitute a market-wide committee to design a practicable framework for leveraging the capital market to finance Nigeria’s infrastructure needs, noted that, its next phase of the support in the fight against COVID-19 will be the establishment of the Strategic Health Impact Fund for Transformation (SHIFT). “This is planned to be a N100 billion fund for investment in healthcare assets in Nigeria, it added.
Giving further insight into the commodities exchanges in the domestic economy, the SEC DG said as part of measures to support the development of the commodities ecosystem, the Central bank of Nigeria (CBN) revalidated its 59.9% holding in the Nigerian Commodities Exchange (NCX) to ensure its appropriate positioning for effectiveness.
“This addressed the funding problem plaguing the NCX and several engagements are ongoing with relevant authorities to promote trading on the Exchange.
“The capital market community believes that the positioning of the NCX by the CBN would deepen the commodities market. Thus, the Commission is engaging with the CBN to encourage acceptance of Warehouse receipts by banks as collateral.
“With the formulation of Rules on warehousing and collateral management, warehouses will be registered by the Commission and accredited by the respective Exchanges. In addition, the Standards Organization of Nigeria (SON) will continue to issue standards that Commodities Exchanges can link up with.
“Similarly, another landmark in the commodities ecosystem, is the commencement of trades by the Lagos Commodities and Futures Exchange (LCFE) on the 15th March, 2021 with T+3 settlement. In addition, The LCFE expects to list crude oil instrument along with Gold instruments”, it added.
