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Chaka Technologies Assures Investors of Funds Security following SEC IST's Restraint

Tech Regulations & Govt	1395 VIEWS
Tech Regulations & Govt
1395 VIEWS

Sunday, December 20, 2020 / 06.57AM / By Proshare Tech/ Header Image Credit: Ecographics/Chaka/SEC

In a swift response to the Saturday afternoon public notice /release by the Securities and Exchange Commission (SEC) indicating that the Investment and Securities Tribunal (IST) had granted an interim order to restrict Chaka from advertising and offering for sale, shares, stock or other securities of NSE-listed companies; the company through Tosin Osibodu, the Co-founder & CEO, Chaka Technologies issued an email titled "Regulatory Update" to customers/investors using its platform to appraise them of the situation and the security of their funds.

Recall that SEC informed the market that the Investments and Securities Tribunal (IST) on Thursday 17th December 2020, made interim Orders restraining Chaka Technologies Limited, and its promoters from advertising or offering for sale shares, stock or other securities of companies or other entities on all Chaka platforms, pursuant to an application by the SEC had filed, informing the Tribunal that the Defendants (Chaka) were engaged in investment activities, including providing a platform for the purchase of shares in foreign companies such as Google, Amazon and Alibaba.

This development has already awoken the market and fintech ecosystem as to its implications for understanding how well regulators seek to build a bridge between tech adoption and regulations; especially given the good intentions covered in the SEC facilitated #fintech Roadmap Committee of The Nigerian Capital Market report of August 30, 2019 titled The Future of Fintech in Nigeria.

It appears from Chaka's mail to customers: it is seeking an engagement that would offer clarity on how and what trading platforms and Apps can work with and within the Nigerian investment space. This, analysts spoken to consider is about time. Indeed, we recall that some of these issues were underscored in Proshare's September 02, 2020 online trading report titled Online Trading Ranking Report 2020 - Trading in a Period of a Virus; Building Good Habits.

In the mail to customers, Chaka Technologies Limited explained their understanding of developments, viz:

"We only learned about SEC's position today and while we await receiving the formal order from SEC, please note that your investments were placed by a duly licensed entity and remain safe through Citi Investments (using the Chaka platform), and will continue to be custodied by a SEC-regulated broker.

Since we began our journey in 2019, we have been transparent about our regulatory status, leveraging strategic partnerships with registered brokers in the U.S and in Nigeria, specifically Citi Investment Capital Ltd, which is regulated by the SEC. Our commitment to investor education, trust, and transparency remain a top priority.

We would like to state that Citi Investment Capital is fully compliant with the commission's regulations as all local equities are offered through a locally licensed brokerage firm, registered with the Nigerian Stock Exchange (NSE), Central Securities Clearing System (CSCS), and regulated by Nigeria's Securities and Exchanges Commission (SEC).

Following the SEC statement, our legal and operations teams are working to accelerate a resolution. Further updates will be provided by Monday."

The statement, in appreciation of the need to manage customer concerns indicated that the firm has activated its support team where customers can reach out to them. The support team can be reached on Telegram, via email support@chaka.ng or via calls to their customer care hotline: +234 701 1204 586.