SEC to fine registrars N1m for illegal charges
Beneficiaries of deceased investors can now access shares left behind by their loved ones without delay, as the Securities and Exchange Commission, SEC, recently reduced the timeline for the transmission of deceased’s shares from three weeks to one week.
SEC, in an amended draft on the operating framework for transmission of shares, also reduced the processes and costs of the transmission of shares from a deceased to the beneficiary, as the commission says the amendment seeks ensure seamless transmission and claim of a deceased’s shares by heirs and administrators.
The move is expected to reduce the quantum of unclaimed dividend of over N70billion in the Nigerian Capital Market.
A statement by the spokesperson for the commission, Efe Ebelo, states that under the new arrangement, the registrar is required to transmit the Letter of Administration to the probate registry within 24 hours of receipt of same for verification.
The administrators/executors are, however, required to provide Letter of Introduction, introducing themselves as the legal representatives of the Estate. The letter should also indicate the names, addresses, signatures and BVNs of the individual Administrators/Executors.
Also required are original death Certificate from the National Population Commission for sighting, original probate letter or Letter of Administration for sighting or the Certified True Copy from a Notary Public.
Others are copy of newspaper advert placed by the Court or Gazette, any evidence of ownership of the investment i.e. CSCS statement(s) of the deceased, original share certificates, dividend stub or dividend warrants or bank statement(s) showing receipt of dividend(s) into the account(s) of the deceased.
“Where the Administrator/Executor cannot provide these requirements, the Registrar may require confirmation through insurance, indemnity or interview.”
Acting Director-General of the SEC, Ms Mary Uduk, stated that one category of investors whose investment yields had contributed to the growth of unclaimed dividends in the capital market were deceased investors.
According to her, beneficiaries of deceased investors as indicated in the Will or Letter of Administration are yet to claim the investments and accrued dividends through the share transmission process.
“The capital market is a market for raising medium to long-term capital via a number of instruments. The most popular of the instruments are shared including bonds with resultant yields of dividends and interests.
“However, the quantum of unclaimed dividends in the Nigerian capital market has been on the increase as investors fail to claim the dividends from their investment in shares,” she said.
The commission also vowed to slam a fine of N1million on registrars illegal charges imposed on investors, as it had disallowed registrars from charging fees on the dematerialisation of share certificates and mandating of accounts for electronic dividend.
A N100 charge per request is however allowed only on change of address, name or mandate, while updating of signature capture and scanning should not be more than N200 per signature.