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Stakeholders want Judiciary to deepen role in Capital Market development

By BusinessNews Staff on June 16, 2015

Some stakeholders in the nation’s capital market have called on the judiciary to deepen its role in the development of the market by fast-tracking capital market related cases.

They also said judges should not grant unnecessary orders in favour of operators who run to courts to shield themselves from punishment after committing infractions in the market.

For instance, Mr. Moses Igbrude of Independent Shareholders Association of Nigeria (ISAN), said that in the past, investors easily got frustrated and discouraged due to the delay in getting justice. “We are now calling on the judiciary that in order to restore investor confidence and as part of their continued contribution to the growth of the market, capital market related cases should be dispensed with speedily,” he said.

Igbrude, who is also the Chairman of “Consumer Rights Awareness Advancement & Advocacy Initiative ((CRAAAI), added that the judiciary should discourage the issuance of orders to capital market operators, who, after violating rules, will then run to the courts for cover. “This has been happening and I believe given the high expectations for change in the entire country, the courts should no longer grant orders to those who have deliberately committed offences and when they are asked to face the music, they run to the court for protection that they do not deserve,” he said.

He explained that the delay in delivery judgement on capital market cases could also discourage and demoralise regulators, hence the need for judges to encourage regulatory bodies by supporting their efforts through positive court pronouncements and timely judgement delivery.

In the opinion of the national chairman, Progressive Shareholders Association of Nigeria(PSAN), Mr. Boniface Okezie, judges should base their judgements on merits of each case instead of indiscriminately issuing orders.

“Apart from fast-tracking the judgement delivery process, judges should listen to arguments of both parties and deliver their judgements based on merits. Also, when any offender is brought before any court, the court should be able to look at the case dispassionately and ask the defendant to go and face the music rather than delay the case unnecessarily or issue orders preventing the defendant from prosecution,” he said.

Another stakeholder, Mr. Oderinde Taiwo of Proactive Shareholders Association of Nigeria, said: “The regular courts should also cooperate with special courts such as the Investment and Securities Tribunal(IST) in resolving capital market cases. A situation whereby IST (which is equivalent to a high court) gives an order and another high court gives a counter order is not good for the market.”

BGL, which was recently suspended by SEC over allegations of holding on to clients’ money worth over N6 billion, decided to obtain a Federal High Court order in Lagos to compel SECto reverse its decision.

Already, some market stakeholders have said BGL took a wrong step. Alhaji Gbadebo Olatokunbo, a founding member of Nigeria Shareholders Solidarity Association(NSSA), said the law is supreme and nobody is above it.

“SEC is the highest regulator of the capital market while BGL is an operator within the capital market and therefore the SEC rules and regulations are binding on the firm. SEC is empowered to sanction any company operating in the market if it violates relevant provisions of the rules. I will advise BGL to go and defend itself like others before the commission’s Administrative Proceedings Committee (APC),” Olatokunbo said.

SEC suspend BGL after considering the report of a detailed investigation into the various complaints received from investors against subsidiaries of Group.

Meanwhile, SEC has insisted that BGL was having liquidity problems and has been running at a loss to the tune of over N48 billion as at December 31, 2014.
The Commission said in an affidavit that BGL is indebted to investors who complained to the tune of N5.769 billion and that the indebtedness has precluded the company from performing its obligations to its clients and investors.

“BGL was bombarded with not less than 40 letters of protest and petitions by investors with respect to their investments and funds which had disappeared. The audited conducted on BGL reveals that non- payment of investors matured funds of over N11 billion, indicating that the company was in serious trouble. The intervention, is therefore to protect investors because the continued operations of the company constitutes a clear danger to the capital market,” SEC said.

[ThisDay]

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