SEC Warns Operators against Unethical Practices in Capital Market

Goddy Egene

The Securities and Exchange Commission (SEC) has warned some operators in the Nigerian capital market to desist from practices that violate rules and regulations in the market.

The commission in a statement on Monday, said its attention had been drawn to an emerging trend of

unethical conduct by brokers, issuing houses/book runners and other receiving agents in primary and secondary market transactions.

The SEC said the concerned operators carry out their activities by inducing investment through the sharing of brokerage fees or receiving agents commission with private banking officers, asset/fund managers, pension fund administrators (PFA)s and other institutional investor classes who are not duly registered or recognised by the Commission as being eligible to be paid commission.

The commission therefore warned: “Notice is hereby issued that only capital market operators duly registered by the commission are eligible to be paid brokerage fee/receiving agents’ commission and such operators shall not pay or offer a percentage of the commission earned from services provided in a transaction as an incentive for investment.

“Any capital market operator found to engage in this practice or similar acts shall be subject to strict regulatory actions in accordance with the rules and regulations of the commission.”

The SEC has enjoined the public to utilise its whistle blowing mechanism to provide information on any known or suspected case for necessary action.

Meanwhile, the stock market opened for the week on a negative note as investors booked profit in bellwethers. The Nigerian Stock Exchange (NSE) All-Share Index (NSE) ASI fell 2.2 per cent to close at 30,199.32, while market capitalisation shed N302.4 billion to close at N13.3 trillion. Activity level weakened as volume and value traded shed 50.6 per cent and 74 per cent to 145.2 million units and N1.7 billion respectively. The top traded stocks by volume were Fidelity Bank (28.3 million units), Access Bank Plc (20.3 million units) and United Bank for Africa Plc (20.1 million units) while MTN Nigeria Plc (N948.2 million), Zenith Bank Plc (N168.3 million) and Access Bank (N117.4 million) led the top traded stocks by value.

In terms of price movement, 19 stocks depreciated compared with appreciated. R.T Briscoe Nigeria Plc led the price losers with 9.3 per cent, followed by MTN Nigeria Plc with 7.1 per cent, while Veritas Kapital Assurance Plc shed 4.7 per cent.