A bill that makes the Securities and Exchange Commission (SEC) the major regulatory agency for all banks and investors in the nation’s capital markets has passed second reading.
The Investments and Securities Act, Act No. 29 of 2007 had signed into law by late President Umar Musa Yar’adua in June 2007, however, it is being improved to to align the country’s market with international standards.
Once the National Assembly passes the bill and it gets presidential approval, operators of ponzi schemes will get 10 years prison term once they are caught.
While speaking with newsmen, the sponsor of the bill, Hon. Babangida Ibrahim explained that the bill is aimed at tacklin fraudulent investment schemes in Nigeria.
He said, “We are enhancing provisions relating to efficient regulation of investment scheme. Recently there is a lot of complaints by Nigerians to the extent the FG itself put some embargo on some accounts on Ponzi schemes. So as of the time of signing the current Act, the ponzi scheme was not in existence in Nigeria. So we have to put some regulations to monitor them.
“Another provision has to do with derivatives and commodity markets. When the existing Act was formed, there were no derivatives on commodity market. if you look at section 223 of the exiting Act, … The plan is to make it a little bit flexible so some tiers of government can be able to approach the capital market to source for fund either for projects or specific projects.
So we introduced other new provisions and some amendments. There are also areas like investors protection fund, also the collaboration between SEC and other agencies in the financial market is also enhanced in the Bill and it also strengthens the authority and enforcement power of the jurisdiction of the securities and investment tribunal. These are agencies in charge of settling dispute between investors,” Hon Ibrahim added.