Don't Miss


Home   >   Goverment   >   Oteh Reveals How Okereke-Onyuike Spent N 186 Million on Rolex Watches, N 37 Million on Yacht, Others

Oteh Reveals How Okereke-Onyuike Spent N 186 Million on Rolex Watches, N 37 Million on Yacht, Others

By on May 8, 2012

The DG of the Securities and Exchange Commission (SEC) testifying before the House Committee probing the crash of the stock market has made some startling allegations against the past leadership of the Nigerian Stock Exchange in the person of Dr. Ndi Okereke Onyuike.

She said, “There were incidents of financial skimming, misappropriation, false accounting, misrepresentation and questionable transactions against the former NSE DG.

“For instance, the NSE bought a yacht for N37million and wrote down the book value within one year by recognising it in the books as a gift presented during its 2008 Long Service Award (LSA), yet there are no records of the beneficiary.

“The Exchange also spent N186million on 165 Rolex wrist watches as gifts for awardees out of which only 73 were actually presented to the awardees. The outstanding 92 Rolex watches valued at N99.5million remain unaccounted for.

“This happened in previous years. Other notable fraudulent transactions include the reclassification of the sum of N1.3billion originally expended on business travels. Of this sum, N953million was reclassified under “Software Upgrade” and subsequently expended as against being capitalised. There were other cases of such unethical accounting practices.

“In 2009, N1.7billion of the 2008 operational surplus was distributed to Council members and employees, in violation of CAMA and SEC rules which preclude the NSE from such, given that the NSE is a company limited by guarantee.

“Given the foregoing, it was important to me that we engage the NSE to address these weaknesses. Unfortunately, the former CEO of the NSE did not attend most of the meetings we scheduled.

“These were the kinds of financial imprudence that were perpetrated at the NSE. These transactions were routed through companies owned by some senior officers of the Exchange.”

Speaking on capital market abuses by banks and their co-horts, she said, ”

“The extent and nature of the market abuses carried out between 2006 and 2008 are the primary reasons for the continuation of the investor apathy that we see today. I will give examples of some of the market abuses that the SEC investigation of the intervened banks uncovered.

“Afribank: With respect to Afribank, Afribank Trustees, Afribank Registrars and their Directors, committed various grave market infractions in share buyback schemes, made misrepresentations in the returns to the SEC to prevent detection that the Bank funded its public offer, violating Section 106 (4), and Section 110 of the ISA 2007 as well as Rule 109B of SEC Rules.

Shares owned by 1,258 entities (some fictitious) and individuals were merged into fourteen accounts of nine companies, some of which were owned by Afribank and its directors. These transactions were done outside the floor of the Exchange. Falcon Securities, Fidelity Finance and Spring Capital were some of the entities used.

“Finbank: Between August 2006 and December 2008, the Executive team of Finbank engaged six law firms to incorporate 95 companies and transferred more than 4425 billion of depositors’ funds to nine of these companies and purchased 2.8 billion units of its own shares, violating Rule 109b of SEC Rules. The Bank also violated Section 105 of the ISA 2007, which prohibits a person from creating a false or misleading appearance of active trading of a listed  security.

“Intercontinental Bank: Between June 2007 and December 2008, Intercontinental Bank, its directors and principal officers engaged in unlawful share buyback schemes, buying about 3.4 billion units of shares using depositors’ funds. It violated Section 105, 106 and Section 110 of ISA 2007 as well as Section 160 of CAMA and Rule 109b of SEC Rules.

“Union Bank: In 2007, Union Bank borrowed amounts totaling N30.4 billion from two foreign investment banks. These funds were transferred to Union Trustees, which in turn transferred the funds to Falcon Securities. In four days in November 2007, Falcon purchased 620.4 million units of shares worth N30.8 billion, ahead of a public offer/rights issue. In 2007, Falcon Securities carried out 181,088 transactions with respect to Union Bank shares. This drove up the share price of Union Bank stocks from a low of N23.30 in January 2007 to N50.33 in November 2007, in other words, a price appreciation of over 110% within 11 months.”

3 Comments

  1. Engr Chukwurah Darlington.

    May 8, 2012 at 10:02 am

    If we are by any means serious in this country, the former DG of NSE should be made to answer to the allegations against her. Indeed all the bank directors mentioned, should be quizzed. If found guilty appropriate action must be taken against them. It will at least deter others who may want to do such.

  2. Engr Chukwurah Darlington.

    May 8, 2012 at 10:02 am

    If we are by any means serious in this country, the former DG of NSE should be made to answer to the allegations against her. Indeed all the bank directors mentioned, should be quizzed. If found guilty appropriate action must be taken against them. It will at least deter others who may want to do such.

  3. Engr Darlington Chukwurah

    May 8, 2012 at 10:08 am

    At least we now know those that are responsible for the stock market crash. I hope appropriate action should be taken against them, if they are finally found guilty. “Nigerian we hail thee”