SEC, NFIU to Tackle Fraud, Ponzi Schemes

SEC, NFIU to Tackle Fraud, Ponzi Schemes

The Securities and Exchange Commission (SEC) and the Nigerian Financial Intelligence Unit (NFIU) have signed a Memorandum of Understanding to collaborate in combating crime in the Nigerian capital market and to ensure that suspicious transactions are eradicated from the market.

The acting Director-General, SEC, Ms Mary Uduk, who spoke in Abuja during the signing of the MoU, said the collaboration was necessary in order to close the ranks in the face of insider dealings, re-awakening of Ponzi schemes, cybercrime and other fraudulent activities that had engulfed the market in the last few years.

Uduk said the commission was paying close attention to digital transactions and was in the process of amending its rules to capture such transactions.

According to her, the commission already has regulations that prohibit shell companies from operating in the capital market and implored the NFIU to assist with solutions to track suspicious transactions as they occur.

Uduk said, “If we have solutions that will help us track transactions, it will reduce the incidence of insider dealing greatly. We will be very willing to collaborate with you on that in our determination to ensure that our markets are efficient and transparent and all investors are protected.

“Some areas where the MoU seeks cooperation of both agencies include training, secondment of middle cadre officers between organisations, cross-border monitoring, repatriation of stolen funds from the capital market and prosecution of offenders, among others.”

On the rising spate of Ponzi schemes in the country, Uduk stressed the need for more collaboration between both organisations and further sensitisation to ensure that unsuspecting Nigerians did not continue to lose their hard-earned money.

The Director, NFIU, Mr Modibbo Tukur, commended SEC for the relationship that had existed between both organisations and assured that the NFIU would continue to play its part in ensuring that the financial system was safe for Nigerians to operate.

He said the NFIU was making efforts to ensure that the financial system was rid of shell companies, adding that for companies to exist, they should have physical addresses.

Tukur said, “If anyone establishes a company, it has to be a company indeed and we have to be firm on this. This has become more important now given the roll out of the Economic Community of West African States (ECOWAS) single currency, because with that, we know that capital and investments will move across borders and it is a single currency.

“So, we have to step up regulation to avoid fraudulent transactions. We will commence by September and some companies would have to be deregistered if they do not meet the criteria.

“We will publish the parameters and also give them enough time to regularise, after which those that do not comply before the deadline will be shut down.”

Tukur added that by the time the NFIU commenced the due diligence on the shell companies, the information would be shared with SEC for further action.

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