As the Securities and Exchange Commission (SEC) continues to grapple with its self- inflicted credibility hiatus arising from the probe scandal by the House Committee on Capital Market, it is now emerging that the SEC’s record in addressing infractions in the market and the apparent compromise of its oversight functions by Arunmah Oteh, the SEC Director-General is beyond despicable.

While Nigerians await full disclosure and appropriate action on the scandal, we make bold to say that it is time for Oteh to go! Nothing short of her resignation or dismissal is acceptable in the present circumstances. It is a reflection of her inadequacy and failure of leadership highlighted by tales of dictatorial practices that Nigerian investors are yet to return to the stock market. That was the purported reason for the public investigation that Oteh turned into a charade with toxic counter allegations against Committee Chairman, Herman Hembe, whose committee was subsequently sacked and another ad hoc committee appointed in its place.

The House Speaker has said that the matter would be referred to the House Committee on Ethics and Privileges for investigation. But one monumental fact which this mortifying bribery scandal between the SEC and the House Committee on the Capital Market cannot subsume is that, the basic issues troubling the sector, particularly the need to restore public confidence in stock market investment will not go away on account of the scandal. Another reason why we are reiterating the call we made in July last year for Oteh to either resign or be sacked.

The anticipated role of the Nigerian capital market in the development of the economy cannot be overemphasized particularly its expected role to achieve the long term finance and remnant of the Vision 20:2020. There is need for the SEC to critically examine and review the benchmark of the operations of the market in line with best practices; and operators made to adhere strictly to them. But if anything, the current scandal has proven that Oteh does not have what it takes to meet these exalting challenges and Nigerians cannot wait for the SEC or the House Ethics and Privileges Committee running around with the Investment and Securities Tribunal, the Police, the EFCC, in their familiar but cynical motion, just to play for time.

Among the sundry allegations against her were that the SEC approved the sum of N66.1 million to rent an official apartment for Oteh in Abuja after she had spent a whooping N30 million on hotel accommodation at Transcorp Hilton in eight months (seven months more than her legally allowed period of stay) while simultaneously receiving the financial entitlements due an un-accommodated Director General. She was also accused of spending N42.5 million to procure three Toyota vehicles without a tender’s board meeting in breach of the Public Procurement Act 2007 and of spending N850,000 (later clarified as N85, 000) for just a meal eaten by a team of experts.

The point must be made that Oteh has quite a case on her hands. Her consolation is that she is hell-bent on going down with Hembe, against who she made several stupendous allegations, not the least of which is Hembe asking the SEC to contribute N44 million for the televised public hearing on the affairs of the Commission. Furthermore, she claimed that in October 2011, the SEC paid Hembe’s fare and estacode to attend a conference on emerging markets in the Dominican Republic. She alleged that Hembe did not attend the conference and did not refund the money. Fair enough; that is left for the House Ethics Committee to determine.

Nigerians want a thorough and fair investigation of this scandal to establish the veracity of the claims and counter claims with sanctions and punishments awarded as appropriate. It is sad that in all this sleaze, the leitmotif for the investigation has been overlooked. The long-suffering Nigerian who invested his money on the stock market, and lost nearly all his investments is still groaning in financial pain. How to stem the downward spiral, restore public confidence and protect shareholders’ interest were to be the thrust of the probe, but Oteh’s antics transformed and degenerated the probe into a farcical commentary on hotel bills, food, drinks and her other self-indulgent eccentricities.

When the SEC on Wednesday, March 21, released the documents proving first contact from the House Committee, Oteh must have thought she would embarrass Hembe and the Committee, with what was indeed a well-contrived distraction. But it turned out to be a text book lesson in self-incrimination. To begin with, why in the world would the SEC under probe accept to defray the cost of the exercise by approving N30 million for the House Capital Market Committee? If Oteh’s SEC was unsoiled, as expected of a regulatory agency, did it need to render financial support to the Committee? The only rational explanation for such irrationality is that the SEC was all out to mask certain internal irregularities that the probe would have unveiled.

In the first SEC internal memo, Hassan Mamman wrote that the Commission was in receipt of an “invitation” from the House Committee to the hearing; not that it had received a request for “financial assistance.” Oteh should explain the SEC decision to “assist” the Committee. “In view of the Commission’s role as the apex regulator of the Nigerian Capital Market and in consideration of the existing cordial relationship cultivated over the years between it and the Committee… we find it appropriate for the management to assist the Committee by co-sponsoring this three weeks long event…It is our considered opinion that doing this will be of immense benefit to the nation’s Capital Market by further creating more conducive atmosphere to finding lasting solutions to the challenges facing the Nigerian Capital Market.”

The ridiculous claim by the SEC that assisting the Committee with funds will create a “conducive atmosphere to finding lasting solutions…” is laughable and should attract no further comment. What should interest Nigerians is that two similar memos were written on March 9 and March 13. Oteh saw all three memos, and even minuted on them. Her endorsement of those memos is testament to the avalanche of the corruption and financial recklessness within SEC under her watch. It stands therefore to reason that after reading the SEC memos, the alluring conclusion to anyone not blinded by prejudice or self-interest is that Oteh is guilty as charged.

Oteh’s inability or otherwise to revamp a battered capital market in permanent decline has been proven beyond reasonable doubt. Either she resigns and saves what part of her flagging reputation and international career is remaining, or she should be ignominiously fired. The choice is hers to make.  

Huhuonline.com Editorial

Source: Huhuonline