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The Untold Story of Divided SEC Management

By on May 10, 2012

Many Nigerians and other watchers of the ongoing capital market public hearing were shocked as Executive Commissioners at the Securities and Exchange Commission (SEC), took turns to deny taking part in many important initiatives and actions taken by the Director General, Ms Arunma Oteh. Many of those who saw this on live TV were shocked by what appeared to be a sharp divide, apparent mutual distrust and animosity between Ms Oteh and other members of SEC’s executive management.

SEC insider sources have revealed that this has been long in coming, and the reasons are not far-fetched.
First of all, it is important to note that the current executive commissioners came into office in June 2008. Their four-year tenure expires in June this year, about a month from today.

Contrast that with Ms Arunma Oteh who took office in January 2010, and still has three years to the end of her first term. It is also important to note that at least two of the Commissioners have each spent not less than 20 years at the SEC, having been appointed from within the SEC. That is a huge plus in terms of in-house experience, but it also creates an entitlement mentality – the feeling that Ms Oteh is an outsider and that the SEC really belongs to them. That is the easily the genesis of the mutual distrust which came to light on Wednesday.

Also, available materials show that the outright denials which played out on live TV are mostly untrue and driven by spite and the fear that they have not done enough to warrant recommendation by the visionary and very demanding Oteh for a renewal of their tenure. A review of some of the items they denied knowledge of will shed more light on this.

1.    Project 50:
Although the Executive Commissioners denied knowledge and participation in Project 50, there is ample evidence that they took part in the planning, and played key roles in the October 31st2011 formal launch and investment forum events.

For instance, as they admitted, the board of the Commission, comprising all executive commissioners, the DG and non-executive commissioners approved the SEC expenditure for the project to the tune of N42 million. The Commissioner Legal, Mr Charles Udora also seemed to suggest that regular staff of the SEC were not involved in any way. A list of SEC Project 50 sub-committee heads obtained today however shows that only two contract staffers were committee heads, namely Frana Chukwuogor and Obi

Adindu. Below is the list of sub-committee leaders:
Microsite, Technology and Facilities: Mr. Henry Rowlands
Security and Crowd Controls: Mr. I. B. Bello
Travels, Protocol and Logistics: Mr. Ismaila Ville
Events Planning: Ms. Placida Awuna
Stakeholder Communication: Mr. Shaka Braimah
Media & PR: Mr. Lanre Oloyi/Obi Adindu
Content: Mr. Obi Adindu
Corporate Gifts & Memorabilia: Ms. Frana Chukwuogor

The SEC management team also played key roles in the event which the Commissioners denied under oath on Tuesday. An entire gallery of photos taken at the launch of Project 50 on the SEC website shows the executive commissioners performing various roles at the Project 50 formal launch. Indeed investigations at SEC and non SEC sources have have confirmed that it was Ms Ekineh who delivered the vote of thanks, and Mr Charles Afamefuna Udora who introduced Alhaji Shehu Shagari, an award recipient who was recognized for establishing the SEC in 1980. It is sad that the Executive Commissioners, driven by motives known only to them came on live TV and denied this laudable project, which the Commission initiated and in which they actively participated.

2.    Contract Staff
The Commissioners also denied knowledge of the recruitment of contract staff who work directly with the DG. On the contrary, it has been confirmed that the recruitment exercises went through executive management. There has however been a backlog of contract staffers since 2008, all of whom have not been ratified by the board. As Ms Oteh tried to explain at the hearing the issue of contract staffing has been mostly short term, two years typically, and board approval is a process the Commission is working on. The ready impression is that this team of execs are out to frustrate Ms Oteh and would likely not approve any of her key initiatives anyway.
There may also have been a mix-up between these contract staffers, about ten of them, and the so called 52 “young professionals.” According to SEC insider accounts, the 52 young professionals (often called YPs), were recruited as permanent staff in core areas of the SEC’s mandate – accounting, law, finance, ICT, economics and mathematics on the basis of a mandate from the Commission’s Board. This is a position which is corroborated by a press release deployed on the SEC website.  An employee of the SEC further informs that these YPs still face intense resistance from the old staff members of the SEC, some of whom call them “Y-Pieces.”

This is indicative of the strong sense of territoriality verging on xenophobia which is ingrained in the SEC system. The transparent, merit-based YP recruitment process which is to be gleaned from the testimony of one of the recruits which was published in a leading national daily newspaper under the heading “How the SEC blew my mind” remains one of the landmark achievements of Ms Oteh, likely one of the reasons behind the internal rebellion by the big guns.
3.    Road Map to Building a World Class capital Market
The denial of any knowledge of this document was, according to another insider, “a fictional script which played out on live TV” with all the Executive Commissioners taking turns to deny having any role in the agenda of building a world-class capital market.
According to Ms Oteh’s presentation to the House of Reps, posted on the SEC’s website at page 10, “In March 2009, the industry-wide committee established by the SEC submitted a report entitled “Nigeria’s capital market: making world class potential a reality.” This report articulated the elements of a world-class capital market. SEC endorsed the recommendations made and I developed a roadmap for developing a world class capital market when I joined SEC in January 2010.”
Curiously, the Commissioners denied making any contribution to, nor being aware of the roadmap. A few things make the mischief obvious. One, there was an insinuation that Ms Oteh’s reform agenda isn’t based on her original ideas as she claimed. In the above excerpt, it is difficult to see where she ever claimed she came with the latest magic wand. Two, it made no sense for the Commissioners to deny MsOteh’s agenda when they in fact were on the SEC board which received the report in 2009.

How else were they supposed to make input to a report they endorsed and presented to Ms Oteh on her assumption of duty? Three, as the DG SEC, what really was wrong in developing a road map based on her idea of the transformation she planned to execute, even assuming she did not receive any input. Yet Ms Ekineh admitted she sent a draft speech most of which elements are contained in the final document. The same Ms Ekineh also claimed the road map was not discussed with her? Something smells foul!

On a final note, some quick deductions are compelling. The current Executive Commissioners of the SEC oversaw the collapse of the market, having been appointed in June 2008. They were key market players in the days of the frequent, usually overbloated IPOs. From what Mrs Okereke, former DG Nigerian Stock Exchange, and many other speakers at the hearings said, the SEC of which the Commissioners were a key part, looked the other way as infractions were committed by banks and other issuers, with impunity.

Mrs Okereke even revealed at the hearing that as DG of the Nigerian Stock Exchange, it was she who nominated Mr Musa Al Faki for appointment by the then President as DG of SEC. A regulated entity appointed the regulator?!It is easy to see why the SEC was weak relative to the NSE, and why there was “harmony” between the then DG and these same Commissioners. Now that an “outsider” has come to transform the market, the internal resistance (apparently also from some SEC staff) leaves one wondering: what are these people afraid of?
Find photos of SEC Executive Commisioners during the formal launch of Project 50.

All Sec commissioners at project 50

Sani Stores at project 50

By Mswala Bothe , Capital Market Activist


  1. Evoque

    May 10, 2012 at 8:52 pm

    This your story is very interesting. Let us be quite realistic about the internal bickering at SEC. It is driven by a dictatorial director general who thinks it is her fiefdom and everything inside it is her serf.

    She is dishonest and it has caught up to her. “xenophobic”, clever choice of words, honestly oteh’s superiority complex and “arrogance” are the reasons for the discord.

    Forget Nigeria at 50. I am quite puzzled at how only one individual can trigger the approval of a N 500 billion AMCON bond. Or how can she in the course of her duty overrule the legislatives on Union bank?

    Then she had the effrontery to damn Herman Hembe! Her D-Day is quickly approaching. Or is she Goodluck Jonathan’s cousin?

  2. Arethadadzie

    May 10, 2012 at 10:08 pm

    @Evoque, all this grammar to describe one person, you’re puzzled at how one person can approve a N500Million Bond? was the bond for her or her family? why aren’t u shocked that only 2 people could decide to change the names and ownership of 3 banks in one weekend….Abeg…the one that concerns Nigerians we wont talk….who did the bond affect? what are bonds used for? to whose benefit was the approval…let’s be realistic….

  3. Royjenkins

    May 10, 2012 at 10:11 pm

    Na wa o  @ Evoque, she had the effrontery to damn Hembe, who the hell is Hembe…there is freedom of speech and association enshrined in the constitution as well as an equality for all persons…should she be scared….hiss……she’s dictatorial, But Sanusi is not dictatorial abi….I think this was a brilliant piece….

  4. Gbemigaomadoye

    May 10, 2012 at 10:13 pm

    We’re busy chasing the Arunma, when Boko haram has killed half of Nigeria and the president is receiving gifts of churches, and warding secret oil blocs, when you all now pay double for fuel, and really dont know where the next bomb will go of…can we be realistic for once….

  5. Evoque

    May 11, 2012 at 1:30 pm

    @aunt:disqusy aretha firstly na 500 billion naira bond. secondly she is in cahoots with aig of access bank, sanusi of central bank and all the other corporate raiders.uncle roy yes she had the effrontery her pant no clean, but she dey point stain for oga forehead…now her dirty laundry is on display…surely u get it now