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Federal High Court dismisses BGL cases against SEC

By Helen Oji 
02 November 2016   |   1:49 am
The Federal High Court sitting in Lagos has dismissed all the cases brought by BGL Plc against the Securities and Exchange Commission (SEC) “for being incompetent”.
BGL Group, Albert Okumagba

BGL Group, Albert Okumagba

The Federal High Court sitting in Lagos has dismissed all the cases brought by BGL Plc against the Securities and Exchange Commission (SEC) “for being incompetent”.

The Court delivered its judgments on the three cases filed against the commission by BGL, its sponsored individuals and subsidiaries. According to a statement from the SEC the cases BGL had brought before the Lagos High Court against the Commission are: FHC/L/CS/767/2015 BGL Plc & 4 ORS VS Securities and Exchange Commission, FHC/L/CS/1050/2015 BGL Plc and 12 ORS VS Securities and Exchange Commission and 2 ORS and. FHC/L/121/2016 BGL Asset Management Limited & and 22 ORS VS Securities and Exchange Commission and Anor.

In its rulings, SEC explained that the court dismissed all the above cases “for being incompetent”, handing a major victory to the regulatory and investor protection mandates of the Commission.

SEC had, last year, suspended BGL Asset Management Ltd., BGL Capital Ltd., and BGL Securities Ltd., from all capital market activities.
The Commission also directed that the Group Managing Director, BGL Group, Albert Okumagba, should cease to be a registered sponsored individual with the Commission following the withdrawal of the registration of BGL Plc as a capital market operator.

SEC explained that all suspicious transactions observed in the course of the investigation had been referred to the appropriate law enforcement agencies for further investigation.

The Commission added that BGL Asset Management, BGL Capital and BGL Securities and all individuals involved in the management of the said companies had been referred to the SEC Administrative Proceedings Committee (APC).

It said that the committee considered the report of a detailed investigation into the various complaints received from investors against subsidiaries of BGL Group.

According to SEC, the committee directed that BGL Asset Management Ltd, BGL Capital Ltd and BGL Securities Ltd be suspended from all Capital Market activities.

It also stated “that all sponsored individuals of BGL Asset Management, BGL Capital and BGL Securities whose particulars are contained in the Commission’s record as at December 2014 be suspended from performing any capital market activity.”

Okumagba prior to the investigation was the President, Chartered Institute of Stockbrokers (CIS), but was asked to step aside by the institute because of investors’ confidence.

During the same period, the SEC Director-General, Mounir Gwarzo, said that the Commission was investigating the operations of BGL Plc, a financial services company, and had set up an interim management team to investigate the company’s operations.

“What we did for BGL was basically extending our investigation process. We undertook target inspection of BGL. When we finished the investigation, we came up with our own report and we wrote them a letter and we said we want them to clarify.

“They responded by asking us for additional time to respond and we granted them that additional time and they responded. We reviewed their response and we felt there is a need for us to go in and confirm or clarify certain things. That is the situation we are in now,” Gwarzo said.

He noted that the findings of the interim management team would determine its next line of action, saying: “We set up an interim management team that has already moved in and is doing its job and I don’t want to pre-empt what they would come up with. But the moment they finish the report, SEC will look at it and take the next line of action.”

The interim management team set up for BGL by SEC was headed by Oladipo Aina, with Abubakar Ambursa, Mrs Hafsat Rufai, Ms Temitayo Siyanbola and Ms Tonne Ladipo-Ajayi as members.

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