The House of Representatives sub – committee on the Capital Market has threatened to authorize the Securities and Exchange Commission (SEC) to take over the management of three insurance companies for flouting industry regulations, tax evasion and other infractions.
Chairman of the sub – committee, Rep. Tony Nwulu made this known after the committee had an interactive session with 11 insurance firms over corporate governance compliance and other issues.
Rep. Nwulu declared that the three insurance companies, namely Great Insurance Plc, Consolidated Hallmark Insurance Plc and Staco Insurance Plc have engaged in insider dealings. They failed to pay dividend to shareholders, evaded paying taxes and failed to comply with corporate governance regulations.
He said, “We interfaced with the insurance companies. The process has led to the uncovering of a whole lot within the insurance sector, which we will also make public. Those that believe that other people’s money is free for all, we will ensure that no matter how highly placed they are, they will not be spared.
“Most of the insurance companies that came have defaulted in paying dividends; only few paid. We also discovered a whole lot of infractions bordering on corporate governance and insider dealings.
“After the committee finishes its work, there are some that we will mandate SEC to quickly take over their management. We have identified some that are just struggling, but answering big names and are in contravention of a lot of things, including taxes.
“Great Insurance, Consolidated Hallmark Insurance, and Staco Insurance fall in this category. Some directors and chief executive officers have companies that do business directly with the insurance company they head. Some are in violation of SEC and Nigeria Insurance Commission (NICOM) regulations,” he declared.
According to him, the sub -committee will further proceed to invite SEC, NICON, NLC, shareholders and law enforcement agencies to participate in subsequent investigative hearings to expose non – compliance with regulations in any sector of the capital market.
“We want them to come and explain to Nigerians and the shareholders what they have been doing with their money. We will leave no stone unturned.
“We will do everything possible to make sure Nigerians do not lose money and their jobs. We will expose the banks the way we have exposed the insurance companies. Let it be on record that we have invited First Bank severally, but they have refused to respond,” Nwulu added.
Some of the 11 Insurance companies appeared before the sub – committee are; Suno Insurance, Law Union and Rock Insurance Plc, AIIco Insurance Plc, Sovereign Trust Insurance Plc, Wapic Insurance, Mutual Benefit Assurance Plc, Cornerstone Insurance Plc, Universal Insurance Plc, African Alliance Plc.
Meanwhile, the committee disclosed that it had mandated SEC to reconstitute an interim management for Capital Oil Plc after it uncovered infractions committed by the firm’s management.
To ensure that none of the culprits go unpunished, Rep. Nwulu said that the committee will communicate with the Interpol to arrest and extradite fleeing former management staff of the company.