-N30.477 billion foreign credit used

By Peter OBIORA investadvocate

Nov 02 2010 17.20 GMT

 

Nigeria’s Securities and Exchange Commission (SEC) has dragged Bartholomew Bassey Ebong, erstwhile Group Managing director/Chief Executive Officer (GMD/CEO) of Union Bank of Nigeria Plc (UBN) to the Investments and Securities Tribunal (IST) over share price manipulation.

 

This was contained in a Statement dated Tuesday November 02 2010 signed by Lanre Oloyi, Assistant Director/ Head, Media of SEC and made available to investadvocate in Lagos Nigeria.

 

“Following investigations on the intervened Banks, the Securities and

Exchange Commission (SEC) had in a statement on 27 August, 2010 informed the public that approximately two hundred and sixty (260) entities and individuals are being taken to the Investments and Securities Tribunal (IST) for alleged involvement in price fixing, share price manipulation, fraud, and insider trading.

 

These activities violate the provisions of the Investments and Securities Act (ISA), 2007” the Statement said.

 

SEC affirmed that following the above, the names of some entities and individuals involved in various Capital Market infractions with respect to Afribank Plc; one of the banks being proceeded against in IST were made public.

 

The Statement further affirmed that in line with management decision to disclose the names of these entities and individuals taken to the Tribunal, “the Commission wishes to inform that the ex-while Group Managing Director of Union Bank Plc, Mr. Bartholomew B. Ebong, Directors of the Bank and its subsidiary; Union Trustees Limited are allegedly involved in manipulating the share price of the Bank” the Commission affirmed.

 

According to the Statement by Nigeria’s SEC, also taken to the Tribunal is Peter Ololo, MD of Falcon Securities Limited, Member of the Nigeria Stock Exchange (NSE) and other members of the company’s Board for their roles in using N30.477billion credit facilities obtained from two foreign financial institutions (names withheld) to raise Union Bank’s share price in anticipation of a future Public Offer (PO).

 

“The Commission, which is seeking injunctions, monetary penalties and disgorgement of profits gained in violations of the ISA from those being proceeded against in court; reiterates its commitment to restore investor confidence, enhance market integrity and protect everyday investor” the Statement said.

 

SEC however, affirmed that with respect to Union Bank, some of the under-listed entities and individuals were allegedly involved in a share buyback scheme in contravention of the Commission’s Rule 109B made pursuant to the ISA.

 

“Investigation by the Joint Task Force of SEC and Central Bank of Nigeria (CBN) on intervened Banks revealed that, between October and November 2007, Union Bank obtained credit facilities of N30.477 billion from two foreign financial institutions. Over a ten –day period in

November 2007, Union Bank transferred these funds to it’s wholly owned subsidiary, Union Trustees Limited in five (5) tranches” SEC said in the Statement.

 

It was further revealed that in turn and almost immediately upon receipt of each tranche, Union Trustees also transferred the N30.477 Billion to Falcon Securities Limited in five successive tranches who acquired over 620 million units of Union Bank shares.

 

The Apex Capital Market regulatory Institution further affirmed that investigations revealed that Falcon’s acquisition of the 620 million units of Union Bank shares was funded by the Bank itself using funds passed through Union Trustees and done at Union Bank’s behest in order to artificially raise Union Bank’s share price in anticipation of a future Offer to the investing public.

 

SEC also said that it found out that Ebong, Samuel Ayininuola, former Executive Director, (ED) Risk Management and Compliance of the Bank; Henry Onyemem, former MD, Union Trustees; Peter Ololo, of Falcon Securities and others devised a scheme whereby Falcon actively traded in Union Bank shares with intent to cause an increase in the share price and thereby violated Section 105 ISA, 2007, “which prohibits activities that may create a false or misleading appearance of active trading in Union Bank shares, as well as the market and price of Union Bank’s shares; and section 106 ISA 2007 which prohibits two or more transactions in the securities of a Corporate Body that have the effect of raising, lowering, maintaining or stabilising the price of the securities” the Statement said.

 

Below are the entities and individuals being proceeded against with respect to Union Bank matter before the IST:

 

1. UNION BANK PLC

 

2. BARTHOLOMEW BASSEY EBONG

 

3. SAMUEL IDOWU AYININUOLA

 

4. AUSTEN IHEANYI OBIGWE

 

5. KENNETH SOLA ADEYEMI

 

6. ADO ABDULLAHI

 

7. EBENEZER UZOMA EMERUEM

 

8. WALTER CHUKWUODINAKA ORJI MBAH

 

9. ANTHONY EBHODAGHE ESANGBEDO

 

10. MUSA GELLA YAKUBU

 

11. AHMADU ABUBAKAR

 

12. MANSUR AHMED

 

13. JOHN OMOTOSHO OMOTAYO AKINLEYE

 

14. EMMANUEL CHUKWUMA EDOZIEN

 

15. IBRAHIM ABDULLAHI GOBIR

 

16. FESTUS BONIFACE OHA ODIMEGWU

 

17. OLUSEGUN OLUSANYA

 

18. COSMAS PAUL UDOFOT

 

19. ONIKEPO AKANDE

 

20. ONAJITE OKOLOKO

 

21. LANRE IDOWU

 

22. EMILY IFEYINWA ODIKANEKWU

 

23. UNION TRUSTEES LIMITED

 

24. MR. HENRY AZUKA ONYEMEM

 

25. MOBOLANLE AJOMALE

 

26. FAB UCHE

 

27. CHARLES TURTON

 

28. FALCON SECURITIES LIMITED

 

29. PETER OLOLO

 

30. TUNDE OGBEHA

 

31. F. NESIAMA

 

32. T. G. OGISI

 

33. S. A. OTEGBOLA

 

34. OLOROGUN LUCKY OGHENE-OMORU

 

35. MATHEW A. UDUEBO

 

36. ERIC NWOBI