Uncover unclaimed dividend owners, Senate tells SEC

The Senate Committee on Capital Market, the Security and Exchange Commission and stakeholders in the capital market on Monday agreed to evolve practicable strategies to address the issue of unclaimed dividends in the country.

The agreement was reached at a one-day public hearing organised by the Senate panel to find a lasting solution to the issue.

Apart from suggesting a further amendment to the Finance Act, shareholders at the forum stressed the need for proper sensitisation about the activities of the SEC.

They also mandated SEC to deploy modern technology to identify owners of the unclaimed dividends and come up with comprehensive data.

All the participants also agreed that the Director-General of the Security and Exchange Commission, Dr Emomotimi Agama, should within the next six months forward to the Senate panel, the necessary strategies on how to reclaim unclaimed dividends in the Debt Management Office.

The DMO, according to the stakeholders had no business keeping the 10 per cent of the fund, as currently empowered by the Finance Act.

Declaring the event open, the Senate President, Godswill Akpabio, said the forum was organised to identify the root causes of unclaimed dividends and to chart a path forward that would empower investors, protect their interest and unleash the full potential of the capital market.

The Chairman of the Senate panel, Osita Izunaso, said necessary legislation was vital to instill confidence in the capital market.

He said, “The most important thing is, what the major takeaways of this summit are? Somebody said here, and I concur with that person completely, that capital market is something that involves trust.

“Once that trust is eroded, people will not want to invest again. And you know since the crash of the capital market in 2018, a lot of people still don’t have confidence in the capital market.

“So it is our responsibility, it is our collective responsibility to make sure that this confidence is built back. Whether you are a stakeholder, whether you are in the parliament, whether you are a shareholder, whoever you are, make sure that this confidence comes back.”

Isunazo added, “The declared dividend alone for five years is N5tn. So which means it’s an average of N1tn, so you can say that it is N1tn annually. So if the dividend alone can be N1tn, then the stock market is not doing badly. But you can see that if it is promoted further, we’re going to make more money from that exercise.”

He, therefore, challenged the SEC DG to redouble his efforts to identify owners of unclaimed dividends through massive enlightenment activities.

Izunaso said, “A lot is on your shoulders because you are the main regulator. Now, there is a need to strengthen the Know Your Customer requirements.

“I’ve said it here. It’s very key. Once you strengthen the KYC requirements, some of these issues will have been taken care of. You should simplify the process of account updates. This is for the bank. Let the process be simplified.

“The shareholder’s representative that spoke was talking about their website where all these things will be there, once you go to that website, you will see everything.

“I don’t know whether there is such a website in existence. If there is, please, make sure that the public knows about it. If there’s none, let there be one. So that all these stories will not come up again.

“They will just go to the website and you see everything there. Now, we need to also address the inadequacies in the financial institutions’ infrastructure.”

He added, “The  DG talked about the leveraging on technology, that is key. That is the major key. We as National Assembly have a role to play and we know our roles. Our roles are very clear. There is a need to amend the Finance Act.

“You can’t lump up all these things together. There is a need to separate it. The CBN will not have a role to play in the matter of accounts, while the SEC and other institutions will have a role in the acclaimed dividends.

“So I think we should amend the Finance Act. And in any case, I don’t just subscribe to the fact that the Minister of Finance should be the chairman of any such institution. He is too busy to chair it. And we don’t even know whether it will properly constitute it.”