SEC hammers Oando Plc over infractions, bars Group CEO, others to step down

The hammer of Nigeria’s capital market regulator, the Securities and Exchange Commission (SEC) has fallen on some Board members of Oando Plc, who have been asked to resign from the company. In addition, the Group Chief Executive Officer, Wale Tinubu and the Deputy Group Chief Executive Officer,  Omamofe Boyo, have been barred from being directors of public companies for a period of five years.

These measures were taken following the conclusion of investigations into the activities of Oando Plc by the regulatory body in the wake of two petitions received by the Commission in 2017.

In a statement on Friday, May 31, 2019, SEC directed the convening of an Extra-Ordinary General Meeting (EGM) of the oil company on or before July 1, 2019, to appoint new directors.

These, among others, SEC stated, are part of measures to address identified violations in the company.

SEC’s full statement read: “Following the receipt of two petitions by the Commission in 2017, investigations were conducted into the activities of Oando Plc (a company listed on the Nigerian and Johannesburg Stock Exchanges). Certain infractions of Securities and other relevant laws were observed. The Commission further engaged Deloitte & Touche to conduct a Forensic Audit of the activities of Oando Plc.”

“The general public is hereby notified of the conclusion of the investigations of Oando Plc. The findings from the report revealed serious infractions such as false disclosures, market abuses, misstatements in financial statements, internal control failures, and corporate governance lapses stemming from poor board oversight, irregular approval of directors’ remuneration, unjustified disbursements to directors and management of the company, related party transactions not conducted at arm’s length, amongst others.”

“As part of measures to address these violations, the Commission has directed as follows:

1. Resignation of the affected Board members of Oando Plc,
2. The convening of an Extra-Ordinary General Meeting on or before July 1, 2019, to appoint new directors,
3. Payment of monetary penalties by the company and affected individuals and directors,
4. Refund of improperly disbursed remuneration by the affected Board members to the company,
5. Bar of the Group Chief Executive Officer (GCEO) and the Deputy Group Chief Executive Officer (DGCEO) of Oando Plc from being directors of public companies for a period of five (5) years.”

“As required under Section 304 of the Investments and Securities Act, (ISA) 2007, the Commission would refer all issues with possible criminality to the appropriate criminal prosecuting authorities. In addition, other aspects of the findings would be referred to the Nigerian Stock Exchange (NSE), Federal Inland Revenue Service (FIRS), and the Corporate Affairs Commission (CAC).”

“The Commission is confident that with the implementation of the above directives and introduction of some remedial measures, such unwholesome practices by public companies would be significantly reduced.”

“Therefore, in line with the Federal Government’s resolve to build strong institutions, Boards of public companies are enjoined to properly perform their fiduciary duties as required under extant securities laws.”

“The Commission, as the apex regulator of the Nigerian capital market, maintains its zero tolerance to market infractions, and reiterates its commitment to ensuring the fairness, integrity, efficiency and transparency of the securities market, thereby strengthening investor protection.”