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take place. What I think SEC should have done is to come and observe,” he said. Okezie added that since the release of the forensic audit result, the shareholders have not had the opportunity to hear from the directors, noting that theAGM would have afforded them the opportunity to get more information from the board of the company. Also, the Chairman, Ibadan Zone Shareholders Association of Nigeria, Mr. Eric Akinduro, said suspending the AGM was unfortunate. He said: “There should be a human face to some of these things. There is a court order saying the status quo should be maintained and I believe the AGM is one of the things referred to by the court order. “Suspending an AGM 24 hours to the meeting is not good for the shareholders and even the market. Some of the shareholders have travelled from other states to Lagos for this AGM.” However, the President, Constant Shareholders Association of Nigeria, Mallam Shehu Mikail, said SEC did the right thing. “To me, SEC has done the right thing because there are so many issues in the company right now and we do not know how the meeting will look like. So, the proper thing is to suspend the meeting. If Oando goes ahead to hold the AGM, it means it is disrespecting the market regulator,” he said. An outraged shareholder, Pastor Olagoke Samson Olusegun, who is President of DeImpressive Shareholders’Association of Nigeria, disagreed with SEC’s decision. He said: “This is simply a game because before we announced the AGM, SEC approved our accounts. So why now? Why is it when Oando is climbing out of the hole of debt and returning to profitability? Like Skye Bank, they want to take Oando over and give to their friends. We will fight to the end as shareholders. If we have to go and meet SEC in Abuja, we will. The SEC is functioning like a car with no engine – and in this game, the only people who suffer are we the shareholders. We will not tolerate it!” Some of the shareholders also accused SEC of high-handedness. “What SEC is doing can only be described as regulatory rascality, and it is unfortunate that this is coming from a regulator. Are they regulators or revenue generators? We should go ahead with our AGM as though nothing happened. We should continue as planned with our AGM. SEC tried to do this in the case of Ikeja Hotels, but we did not let them stop us, we had our AGM under a tree,” an Oando shareholder, Tunde Badmus, said. The Secretary-General,Association for Investors Liberation, Mr. Hamza Ridhwa, who spoke on behalf of the shareholders in Lagos, noted that already the equity had depreciated from N4.20 on May 31, to N3.75. According to him, it was not acceptable for SEC to attempt to take down the company, as Oando Plc adds significant value to the Nigerian economy as an employer of labour and attract foreign direct investment into the country. He said the way and manner SEC suspended the AGM was disappointing and disheartening. “We condemn in absolute terms the way and manner chosen by SEC in announcing the cancellation on the eve of the event, despite having ample time to do the same. We have shareholders who have come in from all over the country; it is disappointing and disheartening to think that SEC did not think it worthy to consider us. “SEC is a regulator that is here to protect the market, and in particular, us the minority shareholders. They have a duty to care for us first. Their actions in the Oando case have neither protected us nor shown a duty of care.” The shareholder activist said shareholders were disappointed at SEC’s investigation into Oando Plc. “The actions over the last two years and specifically the last 10 days, have shown that our voices as minority shareholders are not being listened to,” he said. Clearly, there is an urgent need for the ongoing dispute to be resolved speedily so as to avoid further damage to the company’s reputation as well as further erosion of shareholder value. The apex capital market regulator must abide by all court orders and ensure that it follows due process in the matter so as not to continue to send wrong signals to investors, especially the foreign investors that the country is badly in need of. Double Standard Oando has repeatedly stated that it was not given fair hearing by SEC after it conducted a forensic of its account. Oando also alleged SEC did not avail it opportunity to respond to identified infractions, if any, in the course of the forensic audit. And that the SEC pronounced punishment on its directors without hearing from them. THISDAY is in possession of a letter the SEC wrote to Mr Isyaku Umar of Ecobank Transnational Incorporation Plc , dated December 4, 2013, by then Executive Commissioner, Operations, SEC after it had carried out a forensic audit of the bank that appears to buttress Oando’s position that SEC failed or neglected to follow standard procedure and did not avail it of findings contained in the forensic audit to enable it respond before pronouncing punishment against its board of directors in a press statement on May 31, 2019. Below is the full press release by SEC following the conclusion of the forensic audit of Oando. SEC’s Press Release on Conclusion of Investigation of Oando
Following the receipt of two petitions by the Commission in 2017, investigations were conducted into the activities of Oando Plc (a company listed on the Nigerian and Johannesburg Stock Exchanges). Certain infractions of Securities and other relevant laws were observed.The commission further engaged Deloitte & Touche to conduct a Forensic Audit of the activities of Oando Plc. The general public is hereby notified of the conclusion of the investigations of Oando Plc. The findings from the report revealed serious infractions such as false disclosures, market abuses, misstatements in financial statements, internal control failures, and corporate governance lapses stemming from poor board oversight, irregular approval of directors’remuneration, unjustified disbursements to directors and management of the company, related party transactions not conducted at arm’s length, amongst others. As part of measures to address these violations, the commission has directed as follows: Resignation of the affected Board members of Oando Plc, The convening of an Extra-Ordinary General Meeting on or before July 1, 2019, to appoint new directors, Payment of monetary penalties by the company and affected individuals and directors, Refund of improperly disbursed remuneration by the affected Board members to the company, Bar of the Group Chief Executive Officer (GCEO) and the Deputy Group Chief Executive Officer (DGCEO) of Oando Plc from being directors of public companies for a period of five years. As required under Section 304 of the Investments and Securities Act, (ISA) 2007, the commission would refer all issues with possible criminality to the appropriate criminal prosecuting authorities. In addition, other aspects of the findings would be referred to the Nigerian Stock Exchange (NSE), Federal Inland Revenue Service (FIRS), and the Corporate Affairs Commission (CAC). The commission is confident that with the implementation of the above directives and introduction of some remedial measures, such unwholesome practices by public companies would be significantly reduced. Therefore, in line with the federal government’s resolve to build strong institutions, Boards of public companies are enjoined to properly perform their fiduciary duties as required under extant securities laws. The commission, as the apex regulator of the Nigerian capital market, maintains its zero tolerance to market infractions, and reiterates its commitment to ensuring the fairness, integrity, efficiency and transparency of the securities market, thereby strengthening investor protection.
SEC’s Letter of Invitation to Ecobank Transnational Incorporated Following of Audit