The Securities and Exchange Commission has said that BGL Group Plc, its subsidiaries and sponsored individuals will appear before the commission’s Administrative Proceedings Committee on August 4 and 5 in relation to investor complaints against the group.
This was contained in a notice published on the SEC website on Thursday.
The SEC had suspended the BGL Board and its sponsored individuals in May, 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 the group.
Before taking the action, the SEC had appointed an interim management team, headed by Mr. Dipo Aina, for the group to enable it carry out a more detailed investigation.
It explained in June that it had opened an investigation into the operations of BGL Group after it received over 40 letters of investor complaints against the group.
It had said, “The Securities and Exchange Commission received over 40 letters of investor complaints against BGL Group Plc alleging indebtedness to the tune of about N5.8bn.
“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 the group to keep its promises that led the commission to suspend its board and management.
Explaining the action, it said, “Backed by a court order from the Investments and Securities Tribunal, SEC set up a seven-man Interim Management Team for BGL Group.
“This was a necessary, well-considered action with the sole objective of protecting investors while a more detailed forensic audit was conducted to determine the financial health of the companies within the BGL Group and the nature/extent of infractions committed by the BGL management.”
However, the SEC explained that while the IMT in conjunction with the forensic auditors were conducting formal investigations, BGL obtained a Federal High Court order asking the IMT to vacate BGL premises.
The commission said it complied with the court ruling despite an existing order from the IST.
In a public notice on June 25, the commission said, “In view of the fact that the interim order has lapsed, we wish to reiterate to the general public that BGL Securities Limited, BGL Capital Limited, BGL Asset Management Limited, all BGL Group- sponsored individuals (as of December 31, 2014) and Mr. Albert Okumagba remain suspended from all capital market activities.”
The preliminary report of forensic auditors, SEC said, showed that, “The group’s management had progressively eroded its shareholders’ funds through losses sustained over a five-year period totalling about N48bn as at December 31, 2014.”
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Source : Punch