Tuesday, May 8, 2012
Okereke-Onyuike Plundered NSE, Says Oteh.
CURRENT DG SEC, MS. ARUNMA OTEH (L) & MRS. NDI OKEREKE-ONYUIKE,
FORMER DG OF SEC
.N186m Was Spent On Wrist Watches, N37m On Yacht
...N1.7bn operational surplus Shared
ABUJA, May 07, (THEWILL) - Director-General of the Securities and Exchange Commission (SEC), Ms. Arunma Oteh on Monday accused the management of the Nigerian Stock Exchange (NSE) under Mrs. Ndi Okereke-Onyuike of financial recklessness, for example, of spending a whooping N186 million on Rolex wrist watches as gifts for long-service awardees.
Making the allegations while appearing before the Hon. Ibrahim El-Sudi-led Federal House of Representatives ad hoc committee investigating the state of the capital market, Oteh said that out of the 165 watches, only 73 were presented to the listed members of staff, while the remaining 92, valued at N99.5million, were unaccounted for.
She equally revealed that the NSE, under Okereke-Onyuike, bought a yacht valued at N37million as a gift to an unidentified beneficiary.
“When I joined SEC in January of 2010, my colleagues handed me briefings including a report of an inspection of the Nigerian Stock Exchange that they had undertaken in September 2009,” she said.
“The findings of that inspection were shocking and included weak corporate governance, risk management and internal controls, insufficient oversight of brokerage firms and listed companies, inability to enforce its rules. The report also highlighted a number of financial mismanagement issues, including huge amounts spent on a construction project that was yet to be completed many years after inception as well as the inability to perfect the title of a key asset, the Stock Exchange HQ building.”
According to Oteh, while assets grew by nine times between 2006 and 2008, expenses rose by more than 150 per cent from 2007 to 2008.
“It also brought to our attention that there were incidences of financial skimming misappropriation, false accounting misrepresentation, and questionable transactions. For instance, the NSE bought a yacht for N37million and wrote down the book value within one year by recognising it in the books as a gift presented during its 2008 Long Service Award (LSA), yet there are no records of the beneficiary.
“The Exchange also spent N186million on 165 Rolex wrist watches as gifts for awardees out of which only 73 were actually presented to the awardees. The outstanding 92 Rolex watches valued at N99.5million remain unaccounted for.”
She also disclosed that most of the financial mismanagements perpetrated during the reign of Okereke-Onyuike were routed through companies owned by some senior officers of the NSE.
“In 2009, N1.7 billion of the 2008 operational surplus was distributed to Council members and employees in violation of CAMA and SEC rules, which preclude the NSE from doing that.”
“Other notable fraudulent transactions include the reclassification of the sum of N1.3billion originally expended on business travels. Of this sum, N953million was reclassified under ‘software upgrade’ and subsequently expended as against being capitalised.”
Oteh alleged that all efforts to get the former DG of NSE, Okereke-Onyuike to explain the expenditure of the monies were futile.
“Given the foregoing, it was important to me that we engaged the NSE to address these weaknesses. Unfortunately the former CEO of the NSE (Okereke-Onyuike) did not attend most of the meetings we scheduled,” she added.
Okereke-Onyuike is expected to testify before the committee on Tuesday, alongside president of NSE and chairman of Dangote Group, Alhaji Aliko Dangote; former CBN governor, Prof Charles Soludo; and Femi Otedola among others.
THEWILL - Expanding the National Conversation - Okereke-Onyuike Plundered NSE, Says Oteh