As if to prove that last week’s indefinite suspension of Mounir Gwarzo on the order of the Minister of Finance, Mrs Kemi Adeosun, has nothing to do with a reported plan to gag the capital market apex regulator, the Securities & Exchange Commission (SEC), on Monday said it is going ahead with the conduct of a forensic audit of Nigeria’s energy giant- Oando Plc over breach of several provisions of the Investments & Securities Act and corporate governance rules.
As part of this commitment, the commission in a statement signed by its management said the decision has been communicated to Oando “in a letter dated December 5, 2017.”
The commission also assured “the general public of its zero tolerance to infractions in the Nigerian Capital Market.”
Gwarzo was suspended along with “two management staff of the Commission – Mr. Abdulsalam Naif Habu, Head of Media Division and Mrs. Anastasia Omozele Braimoh, Head of Legal Department – who have been alleged to engage in financial impropriety in the Commission.”
His suspension was directly linked in the media to his insistence on pursuing the Oando forensic audit to its logical conclusion, against the instruction of the Minister and permanent secretary, a claim that has been serially refuted by Oluyinka Akintunde, the Minister’s spokesman.
Gwarzo was directed in a statement by Patricia Deworitshe, Deputy Director, Press, Federal Ministry of Finance, to immediately handover to the most senior officer at the Commission, pending the conclusion of investigation by the Administrative Panel of Inquiry (API) set up “to investigate and determine the culpability of the Director-General.”
The Minister, on Sunday announced the appointment of Dr. Abdul Zubair, the commission’s Director, External Relations and most senior officer, acting SEC DG with immediate effect, pending the outcome of the API.
The commission had weeks ago, announced the appointment of Akintola Williams Deloitte, to lead the team of experts involving: United Securities Limited; SPA Ajibade & Co, a firm of capital market solicitors; Tjadap Consulting and Associates; and Nasiru Muhammad & Co at the cost of N160m to be borne by Oando Plc.
Oando Plc had followed the suspension of its shares on the Nigerian Stock Exchange (NSE) on the orders of the SEC, obtained an injunction stopping the commission’s forensic audit and the NSE from giving effect to the freeze on its share price.
Ruling on the application, Justice Mohammed Aikawa of the Federal High Court, Ikoyi, Lagos, said the court lacked jurisdiction in the suit over allegations of irregularities and governance infractions.
Based on the preliminary objection by counsel to the commission, George Uwechue, SAN, the court advised Oando to seek redress at the Investment and Securities Tribunal (IST), being the proper place for such.
He agreed “that the subject matter of this issue falls within the exclusive jurisdiction of the Investment and Securities Tribunal (IST) and not this court.
“In addressing this issue, I find the provisions of the Investment and Securities Act 2007 quite instructive. Section 284 of the ISA (2007) says the Tribunal shall, to the exclusion of any other court of law or body in Nigeria, exercise jurisdiction to hear and determine any question of law or dispute involving- (a) a decision or determination of the Commission in the operation and application of this Act, and in particular, relating to any dispute- (i) between capital market operators; (ii) between capital market operators and their clients; (iii) between an investor and a securities exchange or capital trade point or clearing and settlement agency; (iv) between capital market operators and self-regulatory organisation; (b) the Commission and self-regulatory organisation; (c) a capital market operator and the Commission; (d) an investor and the Commission; (e) an issuer of securities and the Commission; and Jurisdiction of the Tribunal, etc. 132 (f) disputes arising from the administration, management and operation of collective investment schemes.
“It is not in dispute that the matter before me is a dispute between capital market operators.
That said, he added that “the duty of the court is to apply the law.
“On this premise, I have no option than to uphold the preliminary objection. I also in the same vein uphold the preliminary objection of the 2nd defendant (Nigerian Stock Exchange). This court lacks the jurisdiction to adjudicate the dispute between both parties.
“The proper place for this matter to go is IST. I therefore strike out this matter,” the judge ruled.