Frauds & Scandals | |
Frauds & Scandals | |
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Monday, June 17, 2019 / 06:19PM / NSE Press Release / Header Image Credit: P.M Express
On Sunday, June 9, 2019 the Securities & Exchange Commission (SEC) via a press statement published on its website indicated that “Oando PLC was given sufficient opportunity of being heard and accorded several opportunities to rebut the issues revealed by the investigation.” The Commission goes on to say that these opportunities were via engagement with Deloitte & Touche in the course of its audit into the company’s business.
A hearing can only be said to be fair when all the parties to a dispute are given an opportunity to present their respective cases, and each side is entitled to know the details of the case/findings being made against it and is given an opportunity to reply thereto.
Oando was not accorded a fair hearing because we simply co-operated with the process and responded to questions posed by the auditors in the course of their fieldwork for findings in a report that the Company has still not seen.
Consequently, Oando disagrees with the statement
“Oando PLC was given sufficient opportunity of being heard and accorded several
opportunities to rebut the issues revealed by the investigation” based on the
following facts:
1. Prior
to the commencement of the forensic audit the Company was not afforded the same
opportunity to meet with the SEC as was afforded to the petitioners, despite
repeated written requests to that effect. The first of these requests was on
Thursday, August 24, 2017 from the Chairman, HRM Oba Michael Adedotun Gbadebo
CFR who wrote to the then SEC Director General as follows “We would like to
request for a meeting with you, in your capacity as Director General of the SEC
and regulator on matters involving the securities of our Company, to formally
table our concerns to you and clarify any further questions that you may have
in respect to the issues that we have raised in this and previous letters to
the SEC.”
2.
During
the 18 month long forensic audit exercise, the Company was never given an
opportunity to present its case based on the concerns or findings of the
Forensic auditor to the SEC.
3.
In
the kick off meeting with Deloitte on the 29th of March 2018 they assured the
Company that we would be allowed to read their report on the forensic audit and
give further clarification or comments on matters raised in their report.
Minutes from the meeting which was shared with parties in attendance state
“Deloitte concluded by repeating that the audit will be done fairly and from a
factual perspective. There will be ‘no surprises’. Oando will be allowed to
read their report on the Forensic Audit and give further clarification or
comments on matters raised in the report.”
4.
In
the course of Deloitte’s forensic audit exercise, the Company had a second
meeting with Deloitte on the 1st of November, 2018, and this was at the
Company’s insistence. At the said meeting Deloitte promised that on the
conclusion of its audit it would hold a close out meeting with the Company,
however this meeting never took place.
5.
With
the exception of the aforementioned meetings, all other engagements with both
the SEC and Deloitte were via letters and emails
6.
On
Monday, February 11, 2019 at Oando’s request the Company’s management team met
with the SEC for the purpose of getting approval for certain proposed
transactions as part of our corporate strategy pending the release of the
Forensic Audit. At the said meeting the Company was assured by the Acting
Director General (DG), Mary Uduak that they would call us in to defend the
findings from the forensic report before making a final conclusion. A promise
that she has not honored.
The Company also disagrees with the assertion by SEC
in its press release that “The actions of the Commission were properly effected
pursuant to the provisions of the Investments and Securities Act (ISA) 2007 and
the SEC Rules and Regulations mad pursuant to the ISA 2007”.
Rule 599(1) of the SEC Rules and Regulations establishes the Administrative Proceedings Committee (“APC”) and states as follows:
“1) Pursuant to sections 310 of the Act, there is hereby established an administrative body to be known as Administrative Proceedings Committee (the Committee) for the purpose of hearing capital market operators and institutions in the market who are perceived to have violated or have actually violated or threatened to violate the provisions of the Act and the rules and regulations made there under and such operators or persons against whom complaints/allegations have been made to the Commission”
By virtue of this provision, it is evident that SEC circumvented its own rules and procedures when it failed to invite Oando to appear before the APC and hear its position. The Commission instead approached the media to publish the purported findings and punitive directives against the Company.
We are aware that the APC forum was rightly adopted by the SEC in the case of Mr. Olubunmi Oladapo Oni vs. Administrative Proceeding Committee & Securities and Exchange Commission (2014) N.W.L.R. (part 1424) 334 “The Cadbury Case”, the case of Afolabi Gabriel Oluwaseyi & 9 others vs. BGL Securities Limited & 22 others as well as in the case of the investigation of a certain financial institution. In these aforementioned cases cited, the parties involved were afforded opportunities to be heard before the panel prescribed appropriate punishments.
For the avoidance of doubt, Schedule VIII of the SEC Rules stipulates as follows:
“The Administrative Proceedings Committee of the Commission is a body established pursuant to the Investments and Securities Act for the purpose of resolving disputes in the capital market and giving opportunity for fair hearing to capital market operators and other institutions in the market who are perceived to have violated or have actually violated or threatened to violate the provisions of the ISA and the Rules and Regulations made thereunder or such operators against whom investors have lodged complaint.”
It would have therefore been in line with due process for the aforementioned Committee to have been rightly constituted by the SEC in accordance with the ISA, in order to afford Oando the opportunity to present its case.
We maintain that the SEC has not followed due process,
failed to grant Oando a fair hearing, has acted in a way that is contrary to
best practice and has not proven itself to be a fair and reasonable regulator
acting in the best interest of the capital market and minority shareholders, in
all its dealings on this matter.
Visit Oando Plc IR Page in Proshare MARKETS
Graph 1: Oando Plc – One Year Share Price Movement
Table: Unaudited Q1 2019 Results
Related News on SEC Investigation Report
1.
Two Weeks After: OANDO Shares
Dropped By -7.14%, -22% YTD – Jun 14, 2019
2.
FHC
Lagos Adjourns Hearing Between Oando Plc’s GCE and Deputy GCE and SEC
– Jun 14, 2019
3.
Oando
PLC’s Official Response To SEC’s Suspension Of Its 42nd AGM – Jun 11, 2019
4.
SEC
Suspends OANDO’s Prior Approved AGM Scheduled To hold on June 11, 2019
– Jun 10, 2019
5.
Oando
Update: SEC Aligns Principle Of Fair Hearing With Cooperation During
Investigations – Jun 09, 2019
6.
One
Week After: OANDO Shares Dropped By -4.76% WoW, -20% YTD – Jun 07, 2019
7.
Chief Sena
Anthony and Mr. Oghogho Akpata Resign From OANDO’s Board Effective June 3rd,
2019 – Jun 07, 2019
8. Oando
Share Price Drops 20% Off The Back Of SEC Investor Protection Moves – Jun 03, 2019
9.
NSE
Release: Oando Plc Warns Against Unofficial Company News Circulating In The
Media – Jun 03,
2019
10. SEC
Appoints Interim Management Team For Oando Plc Headed By Mr. Mutiu Olaniyi Adio
Sunmonu – Jun 03,
2019
11.
Post-Forensic
Exchanges: The SEC Letter to Oando Plc and The Oando Rebuttal - Jun 02, 2019
12.
Oando Challenges
SEC’s Ruling On The Outcome Of The Forensic Audit Into Oando PLC –
May 31, 2019
13.
SEC Announces
Far Reaching Decisions On The Investigation Of Oando Plc – May 31, 2019
Proshare Reports - Oando Investigation
1. Memo to The Market: The Oando Corporate Journey – At the Regulators Gate – Nov 22, 2017
2. Download Full (PDF) Report - Memo to The Market: The Oando Corporate Journey – At The Regulators Gate – Dec 2017
3. Review of the SEC Technical Committee Recommendations, Opinion and Final Report – Dec 08, 2017
Quick Recall of Past Market Memorandum(s)
4. Beyond The Noise: MTN’s Post Listing Reactions, Gaps in Rules and Lessons Learnt – May 25, 2019
5. PDF Report - JUMIA IPO and Q1 2019 Result – May 16, 2019
6. Surviving Uncertain Times in the Nigerian Financial Market – Jan 19, 2019
7. Memo To The Market – The NSE, Oscar Onyema Foundation And Corporate Governance – Aug 20, 2018
8. The Bull in the China Shop – A New Paradigm in the Banking Sector (analysis of the SLS Intervention) ... - Proshare Aug 21, 2009
9. Fundamental Considerations for Capital Market Reforms in Nigeria ... - Proshare Sept 06, 2010
10. Memo to the Market: Reappointing Arunma Oteh as DG, SEC - Proshare Dec 31, 2014
11. Where Nigeria got it Wrong - Proshare Dec 01, 2014
12. Leadership, Change and Corporate Transformation – The Nigerian Experience ... - Proshare Nov 07, 2017
13. The Proshare Transcorp White Paper - 2007 – Jan 14, 2007
14. Corporate Governance Rating System (CGRS)
15. Facts Behind the Figures (FYE 2016 & Q1 2017 Performance Review)
16. Oando Plc Half Year Update Call (FYE 2015 & Q1 2016 Performance Review)
17. NSE X- Compliance Report February 21, 2014
18. NSE X- Compliance Report August 7, 2015
19. NSE X- Compliance Report May 2019
Related News on Oando
20. Oando Optimises Value From Midstream Business – Apr 26, 2019
21. OANDO Declares N4.63bn PAT in Q1'19 Results (SP:N4.85k) – Apr 25, 2019
22. Oando PLC Announces Divestment of its Residual 25% Interest in Axxela Limited – Apr 04, 2019
23. Oando’s Plan to Deleverage and Remain Profitable – Apr 04, 2019
24. Axxela Now 100 Percent Owned by Helios – Apr 04, 2019
25. Oando Plc Announces FYE 2018 Results, Posts N28.8 Billion Profit-After-Tax – Apr 02, 2019
26. OANDO Declares N28.79bn PAT in 2018 Audited Results (SP:N5.65k) – Apr 01, 2019
27. Oando PLC, Canadian Government and Accountability Lab Champion the SDG 16 Innovation Challenge 2019 – Mar 26, 2019
28. OANDO Declares N28.79bn PAT in 2018 Audited Results (SP:N5.65k) – Mar 15, 2019
29. Oando Female Engineers Mentor Female Pupils in Celebration of International Day of Women in Science – Mar 08, 2019
30. Oando Employees Donate Relief Materials to Flood Victims in the Niger Delta – Jan 31, 2019
31. Oando, NAPIMS and NAOC JV Celebrate Green River Project and 22nd Annual Farmers Day – Dec 03, 2018
32. NNPC, NCDMB, Oando, Seplat And Many More Push The Nigerian Agenda At The 25th Africa Oil Week – Nov 12, 2018
33. Oando PLC, Nestle Nigeria, Union Bank and others lead conversations on Heritage Branding – Nov 01, 2018
34. OANDO Declares N10.39bn PAT in Q3 2018 Results (SP:N5.05k) – Oct 31, 2019
35. Oando Plc Eyes Growth After Curbing $2.5 Billion Debt – Aug 28, 2018
36. Oando Plc Successfully Concludes 41st Annual General Meeting - Jul 28, 2018
37. Oando Plc Sets the Record Straight Regarding the LCIA’s Ruling on Whitmore, OODP BVI and Ansbury – Jul 16, 2018
38. Oando Plc Awarded EPC Mandate to Develop Ajaokuta-Kaduna-Kano Gas Pipeline Project by the NNPC – Apr 19, 2018
39. Oando PLC Announces YTD September 2017 Results; Gives Operational Highlights
40. Oando Plc state Positions on the Securities and Exchange Commission Alleged Findings
41. Oando Secures Court Injunction, restraining SEC, NSE
42. Oando Shares Now Available for Trading, No Price Movement During Technical Suspension
43. JSE Follows NSE, Suspends Trading in the Shares of Oando Plc
44. Oando Gives Holding Response on SEC’s Directive to NSE to Suspend Trading of Its Shares
45. Oando PLC’s Official Statement on the SEC’s Directive to The NSE to Suspend Trading of Its Shares
46. NSE, SEC Confirm Decision To Suspend Trading On The Shares of Oando Plc
47. Trading on the Shares of Oando Plc Suspended; Reasons Unknown
48. Oando Gas & Power Rebrands as Axxela
49. House of Reps gives SEC Two weeks to submit Report on Oando PLC
50. Oando Plc. - AGM Resolution
51. Oando Plc holds 40th AGM, engages Shareholders on the Progress of its Restructuring Plan
52. Oando Plc's 40th AGM To Hold As Planned Following SEC Confirmation
53. Oando Plc to Hold 40th AGM on Sept 11, 2017
54. Oando Plc Issues an Update on Claims of a SEC Investigation
55. OANDO Declares N4.56bn Profit in Q2 2017 Results,(SP:N7.80k)
56. Oando Issues Press Release over SEC Investigation
57. Corporate Earnings for the Week Ending 140717 – UCAP declares N1.99 billion Profit in Q2'17 Results
58. SEC Investigating Oando Plc
59. OANDO Plc Announces Closed Period
60. Oando Provides Clarifications on its Refinery Ambitions
61. OANDO Declares N1.71bn Profit in Q1 2017 Results,(SP:N5.80k)
62. OANDO Plc Announces Closed Period
63. Oando Plc to Hold 2016 AGM on Tuesday 2nd August
64. Oando Plc Key Highlights on Q4 15 and Q1 16
65. OANDO Concludes Recapitalization Partial Divestment of Equity Stake in Its Downstream Operations
67. OANDO Releases Q4 15 and Q1 16 Results Declares N4.10bn PAT in Q1 SP N6.50k
68. Oando Plc Secures 5 Year N94.6 Billion Medium Term Facility with 10 Nigerian Banks
69. Oando explains what Deregulation of Petrol Price means for its Downstream Operations
70. OANDO to acquire OER Minority Shares for a Consideration of US 1.20 per share in Cash
71. The Corporate Governance Rating System – Proshare
72. ETI, Oando Plc under Fire over Ownership, Governance
Related News on SEC Laws and Corporate Governance
73. NSE Notifies Of The Effective Dates Of Its Rules On Listing On The Growth Board, Free Float – May 22, 2019
74. NSE Notifies of SEC Approval of Rules of The Exchange – May 13, 2019
75.The FRCN Nigerian Code of Corporate Governance 2018 – Jan 18, 2019
76. The-Market-Memorandum---Fundamental-Considerations-for-Capital-Market-Reforms-in-Nigeria/2910
77. Corporate Governance and Directors' Remuneration
78. SEC Proposes New Rules & Amendments to Rules on Book Building, Corporate Governance
79. Good Corporate Governance is Good Business
80.SEC, Udo Udoma And Corporate Governance: The Fact Files
81.Enabling Law – Investment and Securities Act (ISA) 2007
82. SEC Nigeria’s Executed Rules and Regulations as at June 2017
83. SEC Nigeria’s Consolidated Rules and Regulations as at 2013
84. Code of Corporate Governance for Public Companies_4 April 2011
Related News on Oando from Other Sources
85. N236bn Liability: Oando Shareholders Protest in Ibadan – Independent
86. Intel’s Volpi Steps Up Battle Against Wale Tinubu over Control of Oando - ThisDay
87. Suspension of OANDO PLC – SEC
88.Oando Shareholders Set To Sack Wale Tinubu, Board – Independent
89. Notice to the General Public on Oando Plc – SEC
90. So what’s happening at Oando (2)? – Business Day
91. So what’s happening at Oando (1)? – Business Day
92. The inside story: Why SEC ordered a Forensic audit of Oando Plc – Business Day
93. Corporate Stories: Under siege, the battle for Oando - Nairametrics
94. Oando and IAS 24: What the law cannot do by @Doubleeph - Nairametrics
Acknowledgement/Research Links
95. Securities and Exchange Commission, Nigeria
96. The Nigerian Stock Exchange
97. Oando Plc
98. Convention for Business Integrity
99. Vetiva Capital Management Ltd
100. Oando’s Investors Relation Page - TheAnalyst
101. Oando Plc Audited Financial Statements – 2012
102. Oando Plc Audited Financial Statements - 2013
103. Oando Plc Audited Financial Statements - 2014
104. Oando Plc Audited Financial Statements - 2015
105. Oando Plc Audited Financial Statements - 2016
106. Oando Plc Audited Financial Statements – 2017
107. Oando Plc Audited Financial Statements – 2018