By Goddy Egene, 07.06.2010

 

The Senate Committee on Capital Market is currently scrutinising a proposal to set up a body to be saddled with the responsibility of managing unclaimed dividends in the nation’s capital market, a member of the committee told THISDAY last Monday.

 

 

Unclaimed dividends in the Nigerian capital market is put at over  N20 billion and attempt by the government of the Olusegun Obasanjo to set up an Unclaimed Dividend Trust Fund (UDTF) through an Executive Bill was thwarted by investors who  said  that the trust fund would not benefit them.But  the bill  has been reintroduced by a member of the House of Representatives. It has gone through second reading and public hearing is being planned.  Some shareholders, who said given the history of   trust funds in Nigeria, investors’ money would only be misappropriated have vowed to oppose the UDTF.

 

 

However, a member of the Senate Committee on Capital Market said : “We have asked that the issue of UDTF be looked into considering  the importance of the dividends to investors. When people invest in shares, it is expected that they get returns. But there have been rising cases of unclaimed dividends. We are taking a look at the matter and the appropriate decision will be taken in due course,” the source said.Some investors recently restated their opposition to the proposed UDTF, insisting that the law is very clear on how unclaimed dividends are treated.

 

 

For instance, the National Chairman, Progressive Shareholders Association of Nigeria (PSAN), Mr. Boniface Okezie, said:“We said it before and we will continue to say it, there is no need for a trust fund. What the lawmakers should do is cause the Companies and Allied Matters Act (CAMA) to be amended so that the portion, which made the unclaimed dividend to be stale after 12 years be removed so that owners can have access to the dividends anytime  even after 12 years. Creating UDTF will imply setting up an office, hiring a chief executive officer and many others to man the office. Such people will be feeding fat on the money while the owners will be frustrated from collecting their dividend because of deliberate hurdles they would put in place,” Okezie said.

 

 

The General Secretary of Independent Shareholders of Nigeria (ISAN), Mr. Bayo Adeleke, said the bill is  by economic  scavengers. He said: “We killed the bill during  Obasanjo’s time and we are ready to do the same again.”The National Coordinator, ISAN, Sir Sunny Nwosu, has been calling on companies to step up enlightenment of stakeholders on the matter. He said the companies should not allow the UDTF to be floated.

 

(Source:ThisDay)