The Securities and Exchange Commission (SEC) has stated that it has secured donor financing for the acquisition and deployment of a securities market surveillance system, which may put an end to problems related to market violations.
Lamido Yuguda, the SEC’s director general, revealed this in response to inquiries from journalists on the conclusion of the second capital market committee (CMC) virtual meeting over the weekend.
To ensure the prevention and investigation of unfair, manipulative, or illegal trading behaviors, securities market surveillance systems continuously monitor and detect activity for market manipulation, fraud, behavioral patterning, and more across all asset classes and products.
Recall that over the years, problems in the stock market have been attributed to regulators’ inept handling of violations and lax enforcement of operator discipline.
Investors also thought that attempts to rebuild market confidence would be undermined by the SEC’s inability to modernize its operating standards through the use of information technology (IT) tools to monitor daily market operations, particularly the trading platform.
It is anticipated that the implementation of a market monitoring system will make it easier to identify market violations and deal with market abuse as swiftly and effectively as feasible to increase investor protection.
The implementation of the surveillance solution, according to Yuguda, “will enhance the commission’s regulatory and supervisory capabilities over securities trading activities, contribute to the modernization of the local capital markets, ensure market integrity and transparency across all trading platforms, and increase investor confidence.”
The head of the SEC also said that despite the country’s present unclaimed dividend standing at N177 billion, efforts are being made to ensure that it reduces the number of unclaimed dividends to zero percent in the financial sector.
He maintained that the electronic dividend mandate procedure was hampered by the commission’s determination to punish capital market operators (CMOs).
According to Yuguda, the number of unclaimed dividends increased to N177 billion by the end of 2021 from an estimated N168 billion as of December 31, 2020.
“The SEC has made significant efforts to ensure that dividend payments are made electronically through bank accounts by collaborating with registrants. The issue is that some investors have not yet required their accounts to be mandated.
We are currently working to eliminate the need for several registrars in favor of a single point of contact to reduce the percentage of unclaimed dividends to zero.
Additionally, a lot of investors are finding it challenging to keep up with the changes in company names, which has prevented them from having their accounts mandated.
“However, the commission will keep raising awareness in this area. Operators of the capital markets must also exert more effort to show by their actions that the system is effective and puts investors’ interests first, according to him.