SEC wields the big hammer, revokes licences of 21 erring stockbrokers

Operating licences of 21 stockbroking firms have been revoked by the industry regulators, The Securities and Exchange Commission (SEC) and Nigerian Stock Exchange (NSE).

The deregistration of the firms were contained in a release from the regulators made available to newsmen. The action means that the affected capital market operators have been expelled from the market and the public is warned against any transactions with them.

According to the notice signed by Olufemi Shobanjo, Head, Broker Dealer Regulation Division at the Exchange, the firms were punished for various infractions, including inability to meet minimum capital requirement, fraud and inactivity.

Three of the firms were expelled for failure to renew their licences, one was booted for unauthorised sales of client’s stock while seventeen were said to be undercapitalised.

With their expulsion from the market, and in line with Rule 6.12 of the Rulebook of the Exchange, 2015, members of the Exchange are banned from employing any director or principal officers of the firms. All former top officials of the firms would have to go through a special screening and approval before they could be employed by any operator.

NEWSVERGE recall that series of allegations bothering on fraudulent activities and policy infractions have been a recurrent issue against some operators in the country’s capital market, giving the regulators a herculean task to restore investors’ confidence in the market.