Unclaimed Dividends: Identity Management a major challenge — SEC DG

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The Securities and Exchange Commission (SEC) has disclosed that the Commission is engaging relevant stakeholders in a bid to resolve issues of identity management which will assist in solving the rising unclaimed dividends in the capital market as well as other issues.

The Director-General of the SEC, Lamido Yuguda, pointed out that part of the problems of unclaimed dividends has to do with identity management, saying the Commission is currently engaging the registrars’ stakeholders and increasing investors’ education to stem the trend.

Identity theft is a fraudulent practice of using another person’s name and personal information to obtain shares, credit, loans among others.

Yuguda stated this during a presentation of the 2022 budget of the Commission before the House of Representatives Committee on Capital Markets and Institutions in Abuja, recently.

According to Yuguda, the Commission has set up an identity management committee to harmonise various databases of investors and facilitate data accuracy in the market.

He said the committee comprises the SEC, the registrars, the stockbrokers, the issuing houses, the CSCS, and NSE, in addition to the e-dividend management committee.

Yuguda said the committee’s assignment would address the challenges of identity management and help tackle some of the issues of unclaimed dividends, direct cash settlement and multiple subscriptions.

“We have engaged with the industry to see where the issues are. We have understood the problem better and we are working in collaboration with them to ensure that by the end of the first half of 2022 we will be able to report back to this committee some of the milestones achieved in solving some of these issues and we believe it will have a massive impact.”

The SEC boss disclosed that the Commission is also working to combat challenges confronting the Commission on Information Technology.

He said, “We need to transform our IT infrastructure as we superintendent over a market that is vast and technology driven. The Steering committee has started work and we are already looking at the proposals”.

Yuguda said the SEC has been collaborating with the Standards Organisation of Nigeria to develop standards for commodities and the Commission has already held two workshops in Lagos and Kano, expressing the hope that it will make the nation’s agricultural commodities acceptable the world over as well as create wealth for the country.

The DG also disclosed that the Commission recently approved the first electronic offer in the capital market for MTN.

According to him, “Before now, we had rules on electronic offers which we developed but they are only being used now with the MTN offer. These are some of the achievements the Commission has been able to record recently”.

On funding, the SEC boss stated that the Commission does not rely on the Federal Government for funding as it is self-funding adding that the downturn in the capital market due to the ongoing pandemic has adversely affected the revenue of the Commission.

He said, “The budget of 2021 has been a huge departure from the past as we have worked on new sources of income and reduced our expenditures. With these efforts, we know that we will have a Commission that everyone will be proud of.”

The DG commended the Chairman and the Committee members for their unwavering support to the Commission and the capital market.

In his remarks, Chairman of the Committee, Hon. Babangida Ibrahim commended the Commission on its efforts so far and assured that the committee would continue to provide support where necessary to ensure that the nation has a vibrant capital market.

“It is our responsibility to oversight the SEC and that is why we invited them here today to brief us on the performance of their 2021 budget, including the success and challenges they have faced in the year under review. We will continue to engage with the Commission to attain the progress we desire.”