… Oteh Misappropriated Donations – Sources
… Ran SEC As A One-Man-Show
… Reps Query DG Over Unethical Bank Acquisitions
ABUJA, May 09, (THEWILL) – Bottled-up cracks and infightings at the Securities and Exchange Commission (SEC) opened up on Wednesday at the investigation of the House of Representatives into the ruinous state of the capital market, as SEC executive commissioners disowned major decisions taken by the Director-General Arunma Oteh because they were not consulted before their making.
Meanwhile, the ad hoc committee, chaired by Hon. Ibrahim El-Sudi queried the DG for approving the Access Bank Plc acquisition of Intercontinental Bank Plc at the time both the managing director and deputy managing director of Access Bank were owing Intercontinental Bank Plc a combined sum of N16 billion.
But Oteh denied knowledge of Access Bank’s leaders indebtedness to Intercontinental Bank, saying “I was not aware that the MD and DMD of Access Bank were owing Intercontinental.”
The committee equally picked holes in the allegation that Access Bank had raised money in 2007, warehoused it and later used N58.2 billion out of the over N130 billion it raised to buy Intercontinental Bank.
In addition, the committee directed the DG to furnish it with details of why and how SEC allowed Union Bank, which was indebted to the tune of N8billion to go ahead with the acquisition of other banks.
Also, the executive commissioner (operations), Ms. Daisy Ekineh; her legal and enforcement counterpart, Mr. Charles Udora; and finance and administration, Alhaji Lawan Sani all denied knowledge of the activities of Project 50 as well as the engagement of the services of two staff of Access Bank plc on secondment.
Project 50 was a series of events organised by SEC under the leadership of Oteh, to celebrate 50 years of capital market operations in Nigeria.
Even though Oteh denied soliciting and receiving donations from financial institutions operating in the market, THEWILL can however report that the DG lied.
Multiple sources in the financial sector told THEWILL that Oteh deployed her technical advisor, who also doubles as her personal assistant, Ms. Frana Chukwuogor, to coordinate the donations, which never made it to SEC accounting books.
It was Frana who wrote letters on behalf of Oteh to prospective donors, directing that funds should not be paid directly to SEC. THEWILL was further told that the donations were diverted to a ‘consultant,’ and most of it was misappropriated thereafter.
Till date, the DG has ignored internal memos from SEC’s accounting division directing her to retire funds spent on Project 50.
Insiders believe that over N3 billion naira was raised from donors, including N50 million, which SEC made available for Project 50.
The management staff also distanced themselves from the DG’s road map, a pet project towards launching the Nigerian capital market to a first-class entity, saying they have never seen the document neither were they contacted to make any input.
They alleged that there was a total breakdown of official communication coupled with mutual disrespect and mistrust, and as well accused the DG of running a one-man show.
Earlier in her submission, Oteh had said that all members of the management staff were part of Project 50 but the commissioners denied knowledge that any such project was going on.
The committee was told that on assumption of office in January 2010, Oteh employed the services of a project adviser and communications assistant, both of whom were staff of Access Bank.
The ad hoc committee expressed worry that the presence of Access Bank staff at SEC would engender conflict of interest, considering that the bank is also being regulated by SEC.
Although Oteh refuted claims of conflicting interests, maintaining that the two staff had no direct access to the commission’s regulatory functions, the management viewed their engagement as defying public service rules and capable of causing disaffection at the Commission.
“The contract staff problem is affecting moral of staff. There was a young man who graduated in 1998 and was made a director. The contract system that we have has created friction among the staff,” confirmed Charles Udora, executive commissioner (legal services). “We seem to be in a situation of regulatory comatose. Our staff are no longer giving us what we need to regulate the market.”
Speaking on the divisions at SEC, Daisy Ekineh said there was need for the leader to respect her subordinates so that they could in turn reciprocate. “I will agree there is a dysfunction because we have not been working as a team. I would suggest that we communicate more physically instead of through text messages.”
Like others, Ekineh also claimed ignorance of Project 50, being put together to commemorate 50 years of capital market regulation in the country.
While Ekineh admitted she attended its meeting twice and had since lost touch of developments, Udora said he had never been part of it even though it was assumed that he was a member.