Drama, drama, drama! How many of you saw it on TV yesterday? There's an on-going investigation by the Federal House of Representatives Ad hoc Committee into the bad state of the Nigerian Capital Market. Yesterday, former DG of the Nigerian Stock Exchange (NSE), Prof. Ndidi Okereke-Onyuike, was called to testify before the committee and she branded the intervention of the Security and Exchange Commission (SEC) in the affairs of the NSE since 2009 as a plot to cover up its illegalities.
She also described allegations leveled against her by SEC DG, Ms. Arumah Oteh, of mismanaging about N1 trillion, as frivolous. Now SEC has sent out a press release to refute some of Mrs Okereke-Onyuike claims at the public hearing yesterday. Read it after the cut...
SEC Nigeria Refutes Ndi Okereke - Onyiuke's claims at public hearing on 'Near Collapse of the Nigerian Capital Markets'
A number of the claims made by the removed Director General of the Nigerian Stock Exchange in the course of proceedings at today’s Public Hearing were downright false and deserve quick refutation and rebuttal so that the investing and general publics as well as the public records do not retain such falsification.
On the May 20, 2011 judgment of Justice Idris Mohammed of a Lagos High Court, Onyiuke claimed that the SEC only appealed the award of N500m to Okereke – Onyiuke in damages.
This is entirely false because the appeal filed by the SEC was against the entire judgment. The appeal challenged both the substantive judgment as well as the award of =N=500m which was not sought for by Okereke – Onyiuke. Given the fact of this appeal therefore, her claim to being the DG of the NSE is clearly false
She also claimed that the SEC and CBN approved what she called the “Offer Prospectus” for “Private Placements” which have remained unlisted on the NSE. This again is entirely incorrect. At no time did the SEC ever approve offer documents for vendors of private placements. We decry this recourse to deliberate falsification of facts by Okere – Onyiuke under oath. We invite her to deposit proof of this fabrication in the public domain. As a matter of fact, the SEC had placed a number of “buyer beware” advertorials in key national daily newspapers advising the investing public that private placements were beyond the regulatory purview of the SEC.
The point she deliberately refused to make is that Public companies also make private placements for which the SEC must approve as opposed to private placements by private companies.
This deliberate lie was consciously fabricated by Okereke – Onyiuke to hoodwink the general public to the wrong conclusion that the SEC Nigeria was negligent in discharging its regulatory functions in the capital markets.
She also sensationally claimed that the SEC was not performing its market development responsibility. Nothing can be farther from the truth. The Subcommittee system which has been revitalized by the SEC is a market – wide development initiative which is intended to confront all areas of deficiency in the market. The recent investor outreaches in Sokoto, Port Harcourt and Kano as well as ongoing capital market awareness programmes in secondary schools and universities, and market wide capacity building in collaboration with sister regulatory agencies and multilateral financial institutions, are all instances of market development effort undertaken by the SEC.
On the NSE’s trading platform, all her claims were false. It is within the forte of the NSE to offer a detailed refutation of these. What is material for us, from a regulatory point of view, is that appropriate machinery has been set in motion to overcome the challenges posed by the platform bequeathed by Okereke – Onyiuke through wholesale replacement. Contrary to the misinformation offered by her, the platform has a lifespan which lapsed in December 2011. It is not a renewable or upgradable technology like she claimed.
But more significantly, Okereke – Onyiuke, before her removal, had initiated the process of acquiring a loan of 20 million US Dollars from African Export – Import Bank, AFREXIM Bank for replacing the NSE trading platform. This is the same platform that the current leadership of the NSE has concluded arrangements to procure from the same supplier at 10 million US Dollars!On succession planning, Okereke – Onyiuke claimed that she had a succession plan in place. Contrary to this, it is common knowledge that she kept vacillating on succession and delaying her exit despite having spent 10 years in office as Director General and 26 years in the employment of the NSE in senior managerial cadre. The SEC intervention was the only way to cut short her reluctance. It was the only to put paid to the regime of unaccountability and financial recklessness which she had instituted to the point that the exchange was on the verge of bankrupt.