Volume II, Issue 17

Tax Evasion! Adenuga May Have Problems With Foreign Banks

A feel of public opinion immediately after the publication of the damning news of company income tax evasion by Continental Oil and Gas and Conoil Producing, two upstream oil companies belonging to Otunba Mike Adenuga Jr., was that the $610million (N89billion) tax demand the Federal Inland Revenue Service had made on the companies would not stir Adenuga’s considerable wealth and business standing. However, it would seem that perception may be different from reality, two weeks after the May 7, 2009 shutdown of operations at the two companies, the gates of the companies still remained no admittance zones with the seal and locks of the Federal Inland Revenue Service (FIRS). Officials of the Revenue Service that Fortune&Class spoke with insisted that though Adenuga has been trying to rally the influence of his powerful friends in and out of government, the FIRS will not back out of the demand order until the full sum of the tax due is paid. …

Fortune And Class Demands Excess Bank Charges Refund From Intercontinental Bank

In a test of procedure and standard of rules governing the banking industry, Fortune and Class Limited, publishers of Fortune&Class Magazine and Fortune&Class Weekly, has taken issues with Intercontinental Bank over excess bank charges incurred on its overdraft account with the bank. And as a first, the management of the company has directed the firm of Forensic Consulting to forward a demand letter for the refund of N243,639.02 being excess bank charges discovered by forensic accountants while reconciling the account. …

Unity Bank Yet To Declare Corporate Result In Two Years

Unity Bank of Plc has defied the standing rules of the Nigerian Stock Exchange (NSE) and the Securities and Exchange Commission (SEC) on post listing requirements which assert that listed companies must release their quarterly and annual operations and performance result to the investing public through the Stock Exchange and the SEC as and when…

Delisted firms: shareholders rally support to recoup funds

The Independent Shareholders Association of Nigeria (ISAN) is reported be rallying support to help investors of recently de-listed companies on the Daily Official List of the Nigerian Stock Exchange (NSE) recoup their investments in the companies.
According to a report by Proshare NI, Adeleke Adebayo, General Secretary of the Association has confirmed that ISAN had visited…

Agusto & Co Assigns “Bb+” rating to Swap Technologies & Telecoms Plc

Augusto&Co, Nigeria’s respected rating company has assigned a rating of “Bb+” to Swap Technologies & Telecoms Plc. According to a release by the rating company, the rating of Swap Technologies & Telecoms Plc reflects the company’s strengthened capital position, adequate working capital and satisfactory profitability. The rating is hampered by weak operating cash flows resulting…

Telkom Reports That Nigerian Operation Is Difficult …losses In The Country Halve Profit

Losses at Telkom’s Nigerian unit and costs including charges related to stake sales cut the telecoms company’s profit by as much as 50 percent for the financial year to March. Headline earnings a share from continuing operations were as much as 50 percent lower than the previous year. Headline earnings a share, including discontinued operations…

Foreign Fund Managers Show New Interest In Nigerian Stock Market

Fund managers in the United States of America and Europe have been reported by Reuters to be showing more than passing interest in stock markets in Africa with the Nigerian stock market providing the greatest attraction.

The report claimed that having fled Africa in droves during last year’s global financial turmoil, portfolio investors are slowly…

Wonder Bank Fund Laundered On The Stock Exchange Through Capital Oil

There is a strong agitation by financial sector watchers over the possibility of illegal money laundering on the platform of the Nigerian Stock Exchange. A report by Proshare Nigeria indicates that Capital Oil Plc (Capoil), a security listed in the second tier segment of the Nigerian Stock Exchange (NSE) has listed shares purchased with funds…

How We Planned To Save Minority Shareholders In Delisted Companies-Independent Shareholders Association Scribe

In this interview with PETER OBIORA of Proshare NI, Adeleke Adebayo, the General Secretary Independent Shareholders Association of Nigeria (ISAN) at the venue of the 84th Annual General Meeting (AGM) of Unilever Nigeria Plc (Unilever) discusses issues relating to the recently delisted companies on the Floor of the Nigerian Stock Exchange (NSE), what shareholders are doing to help save minority investors, and why companies delist from the Exchange.

Other issues discussed include the delisting of Cappa D’Alberto Plc from the NSE, shareholders efforts to help investors of recently delisted companies, Unilever and 68 Kobo dividend to investors of the company, Cadbury Nigeria Plc (Cadbury) and Okitipupa Oil Plc raising fresh funds. Excerpts: …

CBN Slams Stock Brokers Over Interest Rate…Vetiva Capital Management Ltd Loses Millions To Clients

Are stockbroking firms legally empowered to charge interest on margin account or to undertake any form of lending activity with objective to profit from through accrual of interest rate? This is the question the Central Bank of Nigeria may have resolved with its declaration that stockbroking firms or asset management companies cannot possibly qualify to…

TRANSGLOBE BECOMES MOST SUSPENDED STOCKBROKING FIRM IN THE CAPITAL MARKET

DG, SEC

Apex capital market regulatory body, Securities and Exchange Commission (SEC) may suspend Transglobe Investment and Finance Company Limited (Transglobe) indefinitely over unethical practices.

According to a report by Proshare NI, a source made this affirmation to one of its reporters last week.

“SEC would suspend Transglobe over unwholesome practices,” the source reportedly said.

The source further affirmed that the suspension maybe indefinite and would take effect from sometimes next week; after an all parties meeting in Abuja, Nigeria.

It has been reviewed that a lot has gone wrong with the dealing firm under the Nigerian Stock Exchange (NSE).

Transglobe has been found to be illegally trading on shares of most of its clients, including a high profile client through the relationship its General Manager and acting MD/CEO had with a director of a multinational cooperative.

A letter signed by E.A Okolo on behalf of Musa Al-Faki, Director General (DG) of the Commission to the Cooperative and made available to Proshare NI; shows that SEC is currently investigating a case of fraud and misappropriation of funds belonging to the Cooperative of the multi national company by Transglobe.

The letter which was dated February 04, 2009 with reference number SEC/M & I/INVGT/MISC277/09 states that the SEC is currently investigating the case and in order to resolve the issues, has invited the Cooperative to an all parties meeting to be held at SEC’s Head Office on Thursday February 12 2009.

This issue has been raging on close to seven months now; which led to the suspension of Joseph Okolie and Sunny Ameh, acting Managing Director/CEO and General Manager (GM) respectively of Transglobe. It will be recalled that a case of Fraudulent conduct was delivered against the former MD/CEO: Mr. Wilberforce Onwuka.

SEC had on behalf of 31 complainants handed over Onwuka to the EFCC at the end of a hearing involving Transglobe because almost all of the 31 complaints against the company originated during his tenure as an officer of the company and occurred with his personal knowledge.

Currently, It has been affirmed that the firm owes billions of Naira; while its former Management in collaboration with some banks and fund managers made billions of Naira as well through share manipulations and financial engineering…especially on their transactions related to Geofluids Nigeria Limited.

This is coming on the heels of the resignation of two management members of the firm on the grounds of integrity concerns and interference by the Board of Transglobe and its former suspended management members of Joseph Okolie and Sunny Ameh. These members, we understand, are supervised by Mr. Sunny Obidiegwu, supervisory director and cousin of the chairman of the board, Nze Madako.

Prior to this time, the NSE had suspended Transglobe mid-2008 over infractions against its clients which include issuing of dud cheques, purchase of shares with clients’ funds in their names and not in the names of the clients; unbundling of shares purchased in the name of client not credited to the Central Securities Clearing System (CSCS) account but sold through contract notes.

The non-crediting of clients’ shares to its CSCS accounts; the use of funds provided for the purchase of shares for the cooperative, which was alleged not bought or/and unalloted, but for which bonus shares have been discovered in a separate CSCS account.

The use of clients’ funds as lien using fake seals and letter heads of the clients to procure facilities and non-verification of shares certificates of clients’ accounts.

As at the time of filing in this report, Proshare NI could not clarify the true status of the matter when it contacted Lanre Oloyi, Head, Media of the Commission. “I cannot confirm this issue at this moment due to an all parties meeting that has been scheduled,” he said.

Former Wema Assets MD Arrested

The calm that pervades the banking hall of Wema Bank was rustled last week when Mr. Bayo Ogundipe, former President of Wema Asset Management Limited, a subsidiary of Wema Bank was, according to Proshare NI, arrested.

A source close to Proshare NI confirmed that Ogundipe moved to and detained at the Special Fraud Unit (SFU) at Milverton Road, Ikoyi in Lagos, Nigeria.

The source further confirmed to Proshare NI that Ogundipe was held over an alleged fraud of about N1.0 billion perpetrated during his tenure as the Chief Executive at Wema Asset.

Wema Asset had traded as the Trustee and Corporate Finance Division of Wema Bank, and subsequently as Investment Banking, Corporate Finance and Asset Management division under Adebisi Omoyeni, the erstwhile Group Managing Director (GMD) of the Bank.

However, Proshare NI could not gather more details on this, and as at the time of filling in this report, it could not also confirm the true situation from SFU as regards the arrest of Ogundipe.

Sterling Bank’s share reconstruction dust yet to settle

The dust raised as a result of the recent share reconstruction done by Sterling Bank Plc is yet to settle.

 

This is coming on the heels of investors’ reactions that trailed the banks letter to Proshare NI defending the action.

 

As published on Proshare’s website on October 30 2008, Sterling Bank explained in summary the whole process of the share reconstruction;

 

Here are the reactions of investors, some of whom are shareholders of Sterling Bank, in respect of the share reconstruction.

 

Morris Hill in his reaction expressed doubt on the rational behind the Sterling Bank share reconstruction and has called on regulatory authorities to look into the activities of the bank. While Bello Ahmad Abdulmalik is of the opinion that where such share reconstructions occur, the Nation’s Capital Market is not expected to grow. “How would you expect foreign investors” Abdulmalik said. He further affirmed that there are no regulators in our Capital Market.

 

Ade Adeoye, a shareholder of the bank in his reaction wished to know those investors that benefited from the additional shares issued.  “How about those who bought the shares after the merger and a day before the closure of register for the reconstruction?” he queried. Adeoye suggested that perhaps, the Directors of the bank sold their shares during the period of the reconstruction.

 

“This is the more reason information should be made available to the investing public on a timely basis” Adeoye said.

 

He further affirmed of the need for the Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NSE) to clarify the Sterling Bank share reconstruction saga.

 

“Anyway, it is a known fact that the Nigerian market is a BUYERS BEWARE Market. How else will such things happen?” he wondered.

 

As earlier reported Sterling Bank had a recent post merger share reconstruction that resulted in the allotment and issuance of additional 13,317,026,285 ordinary shares of 50kobo each ranking pari-passu with existing shares and bringing the Bank’s total issued shares to 23,869,873,936 ordinary shares and thereafter reduced its outstanding shares through reconstruction.

 

This investors of the bank were not happy with this, but Sterling Bank claimed that the Bank’s shareholders at its 45^th Annual General Meeting (AGM) approved the resolution for the reconstruction of the Bank’s shares which was eventually carried out on the ratio of 10 new shares for every 19 existing shares held.

Most investors of the bank became suspicious that despite the shares reconstruction, the impact did not reflect in the price of the Sterling Bank’s stock which, rather than move upward, as expected the stock price hit the dirt.