BGL, subsidiaries still suspended from capital market – SEC

The Securities and Exchange Commission has said the suspension of BGL Plc and its subsidiaries is still in place, despite efforts by the group to halt proceedings by the capital market regulator against it.

The commission said this after the court discharged the restraingin order obtained by BGL Plc and its subsidiaries in May.

A notice dated September 19 and published on the SEC website read in part, “This is to inform the general public that on September 17, 2015, the Federal High Court in Suit No. FHC/L/CS/767/15; BGL Plc & Ors Vs Securities and Exchange Commission, discharged the ex-parte order obtained by BGL Plc and its subsidiaries on May 27, 2015.

“In view of the court’s ruling, BGL, its subsidiaries and sponsored individuals remain suspended from operating in the Nigerian capital market.”

The commission had on May 21 suspended BGL Plc and its sponsored individuals from all capital market activities, disclosing that its executive management committee had taken the decision after considering the report of a detailed investigation into various complaints received from investors against subsidiaries of BGL Group.

Specifically, it was decided “that BGL Asset Management Limited, BGL Capital Limited and BGL Securities Limited be suspended from all capital market activities”.

The Group Managing Director, BGL Group, Mr. Albert Okumagba, was also barred from carrying out capital market activities following the withdrawal of the registration of BGL Plc as a capital market operator.

In April, SEC had suspended the board and management of BGL and instituted an interim management team for the company to pave way for a detailed investigation of its operations.

The SEC explained in June that it had started the investigation into the operations of BGL Group after it received over 40 letters of investor complaints against the group, alleging indebtedness to the tune of about N5.8bn.

It added, “Investigations were conducted and all-parties meetings were arranged by SEC during which repayment agreements were struck between BGL and some of the affected investors. Unfortunately, BGL continued reneging on promises to restitute investors.”

The commission explained that it was the failure of BGL to keep its promises that led the commission to suspend its board and management.

However, SEC explained that while the interim management team in conjunction with the forensic auditors was conducting a formal investigation, BGL obtained a Federal High Court order asking the IMT to vacate the BGL premises.

The commission said it complied with the court ruling despite an existing order from the Investment and Securities Tribunal.

In June, following the expiration of the court order that the group, and its subsidiaries, remained suspended because the preliminary report of forensic auditors showed that “the group’s management had progressively eroded its shareholders’ funds through losses sustained over a five-year period totalling about N48bn as of December 31, 2014.”

BGL Plc, its subsidiaries and sponsored individuals had been scheduled to appear before SEC’s Administrative Proceedings Committee on August 4 and 5 in relation to the complaints and investigation, but the group obtained an ex-parte order from a Federal High Court against the commission, leading to the suspension of a planned hearing.

SEC said in a statement on Sunday that it “is committed to protecting investors and the capital market and to this end will ensure that persons who violate the provisions of the Investment and Securities Act and the rules and regulations made pursuant thereto will be sanctioned appropriately.”

The commission, however, did not give a new date for the group to appear before its APC.

Operatives of the Economic and Financial Crimes Commission had arrested Okumagba, for an alleged N28.9bn fraud on Wednesday, September 9.

The PUNCH had reported that his arrest was in response to a petition by SEC in May.

An EFFC source had said, among other things, that “the suspect (Okumagba) is alleged to have diverted the sum of N28.9bn being proceeds of private placements of 4.3bn ordinary shares of 50k each at N7.00k per share in 2007.”

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Source : Punch

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