Against the backdrop of several postponements by the House of Representatives panel investigating the near collapse of Nigeria’s capital market, there have been widespread reports that the panel is cash strapped, hence unable to fund most of its activities. ADESUWA TSAN and EDEGBE ODEMWINGIE writes on the probe.
The House of Representative’s panel investigating Nigeria’s wobbling capital market suspended its public hearing last Monday after failing to reach a deal for a live telecast of the controversial probe that is battling to shake off a crippling fraud scandal.
Well, the gist is that there was no cash available for the Ibrahim El-Sudi led eight-man panel to pay a private television station which was hired to transmit the hearing live.
El-Sudi, who heads the ad hoc committee set up to replace the former Herman Hembe-led committee on capital market, said there was a “communication chasm” with Channels television which was to relay the deliberations.
“We were supposed to air today’s public hearing live, but there was a communication chasm with Channels Television, hence our inability to carry the probe live.” According to the panel’s chairman, “Nigerians are interested in knowing what is happening so that confidence can be restored.”
Those in the know said the Lower House panel failed to make payments for the transmission after promising to do so since last Friday, prompting the television station to stay the coverage.
“The committee approached us (Channel Television) for live coverage of the public hearing, we agreed and gave them our rates. They promised to get back to us on payments, but till today (Monday) no payment was received from the committee, hence our decision to stay the coverage.” A staff of the private television confided in LEADERSHIP.
The Chairman of the House Committee on Media and Public Affairs, Zakari Mohammed dismissed reports of a broke panel.
Mohammed insisted that the House was neither facing cash-flow challenges nor was the capital market hearing poorly funded.
“Whoever told you that the panel is not funded has lied; it is totally untrue.
“The leadership of the House funded the hearing adequately and at the appropriate time after the investigation, we shall inform the public how much was spent on this exercise,” he stated.
The new committee, it is learnt, has been instructed to carefully carry out the probe, if possible with no dust raised, hence its insistence on live coverage of the hearing. This is especially after its predecessor was consumed by a bribery allegation that dealt a devastating blow on the image of the Lower House already struggling to shake off charges of similar shenanigans in the past.
Yes, remember Hembe? He headed the substantive House capital market committee which he and members of the committee were disqualified itself after the panel was accused of asking for N44 million bribe from the Security and Exchange Commission (SEC), one of the agencies slated for questioning by the committee.
Speaking with newsmen on the sidelines of the public hearing, Minister of State for Finance expressed support for the panel’s decision to call off Monday’s public hearing. Ngama, said having to wait for a live transmission was the best for the hearing.
SEC DG, Ms Arunma Oteh refused to speak to journalists when asked whether she would support the rescheduling.
“Many people have invested and we are trying to restore confidence in the market. So whatever we say has to be covered. Information is the key thing in the capital market, investors take decision based on information available to them. Any attempt to tamper with the flow of information will not actually help the market. So I support the move and accept that everything we do in this panel must be aired live for everybody to see. The investors will know that the problems in the Nigerian capital market are being looked into”, the Minister said.
“Information is the key thing in the capital market. Any attempt to tamper with the flow of information will not actually help the market,” he said.
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Trading blames
The Central Bank of Nigeria (CBN) Wednesday blamed the near collapse of Nigeria’s Capital market on the sharp practices of some commercial banks and a “systemic” failure of regulators in the sector.
At the resumed public hearing of the Lower House conducting? probe of the country’s ailing capital market, the apex bank’s Deputy Governor in charge of Financial System Stability, Dr. Kingsley Moghalu said regulators including the Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NSE) were culpable in the capital market near collapse leading to the withdrawal of $15 billion by foreign investors in the market
Moghalu admitted that some of the policies introduced by the CBN equally contributed to the crises in the banking sector and capital market.
Amongst others, Moghalu, stated that that the global financial meltdown further aggravated the crisis in the capital market. He listed perceived uncertainty in the economic environment; the Niger Delta crisis, the panic recall of margin and share loan facilities by banks as well as downward renegotiated Foreign Trade Support line given to Nigerian banks.
Moghalu accused Nigerian banks of manipulating bank shares in cohort with some stock broking firms. According to the CBN’s Deputy Governor, banks report to regulatory authorities and investors were seldom accurate, by implication, depriving regulatory authorities, investors and other stakeholder’s right information to take timely and sound decisions.
He said diagnostic and forensic investigation conducted by the CBN revealed “insider-abuse”, including concealing of insider loans, and the use of depositors’ fund to acquire bank’s owned shares among other abuses.
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