Conflict of Interest Situation in the SEC Leadership
Category: Capital Market
When Newspapers yesterday reported the story of Senator Udoma Udo Udoma as the new appointed Chairman of chairman of the Board of Directors of UAC of Nigeria Plc, effective January 2, 2010; we issued a blog post Regulators, Reporting and Resolutions(http://proshareng.com/blog/?p=121) where we highlighted what appears to be a conflict of interest situation.
From all records available to us, Senator Udo Udoma remains the Chairman of the SECURITIES & EXCHANGE COMMISSION, Nigeria.
Recall that we raised the need for the office of the Chairman of SEC to be unfettered and unencumbered from any relationship that would tie it to any of the companies he is expected to regulate upon on page 59, 62 and 63 of the report – ‘The BULL in The CHINA SHOP’ http://www.proshareng.com/reports/view.php?id=2016.
In that review, we stated that the chairman “ought to have recognised that his current directorship of UACN Plc raises serious issues that could compromise the perception of impartiality. It is simply not right and there must be a cogent explanation for this, giving what we know of the man and his pedigree. We do not have any case of wrongdoing alleged against the Chairman but we believe that the elimination of the room for ‘unregulated relationships’ is critical to any perception of integrity or the ability of the regulator to take actions without fear or favour of ‘powerful’ forces that loom large over the SEC. It must be noted that SEC has operated under excruciating circumstance that have seemingly drowned out the considerable amount of good work done.”
We therefore call on the Governing Board of the Securities and Exchange Commission to clarify this development.
We believe we have a ‘serious’ issue on hand that should interest the Senate Committee on Capital Markets. The notion that there does not exist a real or perceived conflict of interest situation that could further erode confidence in SEC’s discharge of its obligations and corporate governance is unwelcome.
Recall that it was the same SEC that issued a query four months ago to Prof. (Mrs.) Ndi Okereke-Onyuike over the implications of her status as the DG of the NSE and Chairmanship of Transcorp Plc. The logic for allowing this situation by SEC would not hold in the case of the Chairmanship of SEC.
The year 2010 must not start on such a note. This dual chairmanship is untenable