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SEC Expresses Worry Over Proliferation Of Illegal Operators

The Securities and Exchange Commission has stated that the persisted proliferation of operators running illegal investment schemes in the country continues to be a major critical concern to the capital market.

The Director General of the SEC Mr. Lamido Yuguda who stated this in a New Year Message in Abuja, therefore assured of a renewed onslaught against promoters of such schemes.

Yuguda said that last year alone, the Commission sealed off the offices of four (4) such illegal operators that had defrauded innocent citizens of billions of naira and assured that the Commission will continue its enforcement actions to ensure that such illegal entities are not allowed to operate.

According to him, “The SEC has been fighting a serious war against Ponzi schemes, we have been alerting people. We have said that investors should only deal with registered operators that have the registration of the Commission, we have their list on the SEC website and we have always said that if you go to an operator or when an operator approaches you, you must confirm that he is a licensed operator with the SEC. 

“We have our numbers on how to reach our offices in the zones and we have done a lot of sensitizations in terms of seminars, webinars all in an effort to discourage people from going to Ponzi schemes. Unfortunately, a lot of people continue to patronize this Ponzi schemes, we have had cases that have been reported to us, our enforcement department and the police unit have been on many of these cases trying to resolve the cases that have been reported to us.

“The Commission has also continued to employ its compliance tool to ensure that only fit and proper capital market operators practice in the market. This has resulted to an improved level of compliance with filing of prudential returns rising to 96% in 2022 compared with 81% in 2021”.    

The DG expressed confidence that as the results of the various initiatives the Commission is implementing begin to gradually manifest in 2023, the Commission and indeed the Capital Market will witness uncommon development in securities issuance businesses especially as it affects digital assets, commodities trading ecosystem, custodianship of assets, and Fintech among others. 

“With the implementation of the Revised Capital Market Master Plan, the Market will also witness renewed confidence expected to attract fresh investments from domestic and foreign investors.  

 “Although 2023 is an election year and market activities may typically slow down before and during the general elections, we are hopeful that the improved awareness and positive electioneering campaigns will lead to peaceful elections and a quick return to the pre-election levels of investment activities. 

On some of the achievements of the Commission in the last year, Yuguda disclosed that on Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT), in order to comply with the requirements of both the GIABA Mutual Evaluation Report(MER) Follow-Up Process and the FATF International Cooperation Review Group (ICRG) requirements to avoid Nigeria being placed on the FATF public grey list at the Plenary after the deadline in October, 2022, the Commission approved the Rules and Regulations of the Virtual Asset Service providers b. Amendments of the sector specific regulations to repeal the 2013 SEC AML/CFT Regulations and enactment of the 2022 AML/CFT Regulations.

On Fintech, the DG stated that the Commission will pursue various initiatives, including sensitization programmes on Crowdfunding adding that to further strengthen and encourage developments in the Fintech space, the Commission resuscitated the Regulatory Incubation program during the year.

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