Insiders Routinely Manipulate Share Prices On Exchange
Insiders routinely manipulate share prices on exchange
[QUOTE]Ndidi Okereke-Onyiuke is not fit and proper to be in charge of our stock exchange, a market that requires transparency and integrity for it to function properly as an engine for economic growth.
But some people can't take a hint.
On Wednesday the Securities and Exchange Commission decided it was no longer going to be a lapdog for Mrs. Okereke-Onyiuke, the long-entrenched director general of the Nigerian Stock Exchange. The SEC, seeking to be the watchdog agency it was always supposed to be, met in Abuja and issued a few directives. One effectively took away from Cash Madam the power to suspend trading in the shares of particular companies, something that had been widely used to manipulate stock prices to the advantage of insiders.
The SEC also pointedly directed that Mrs. Okereke-Onyiuke explain why a company of which she is chairman, the odious and thoroughly disreputable Transcorp, is freighted with non-performing loans to the tune of N75 billion. Quite rightly, the SEC sees this directive as necessary, "given the sensitivity of her position as the chief executive officer of the NSE."
Of course, we have seen no evidence so far that Madam is sensitive to anything. Even as several others who were originally part of the Transcorp misadventure bailed out one by one-- the billionaire businessman Aliko Dangote was one early example-- Okereke-Onyiuke has hung grimly one. She did so even after the top executives of the company, including the chief executive, the jericurled Tom Iseghohi, were detained for several weeks and are now being tried for fraud.
No deal or conduct, however much it fails the smell test, appears unattractive to the stock exchange chief. With no contact or permission from the campaign of then US presidential candidate Barrack Obama, the stock exchange chief rallied her usual self-serving suspects ostensibly to raise money for the Obama campaign, under false pretenses. So embarrassed was our government that Okereke-Onyiuke soon found herself arrested and detained by anti-graft authorities.
It is a measure of how thoroughly compromised our capital market has become that even the arrest of its chief on suspicion of larceny was not enough for the stock exchange council or the SEC to nudge her aside. In Nigeria, no behaviour, however crass or borderline criminal, is unacceptable.
Under Okereke-Onyiuke, our stock exchange has gained justifiable notoriety for gaming the system. It is a place where insiders rule, where ordinary investors have no hope of a fair shake, and where large blocs of shares change hands in smoke-filled rooms without being immediately recorded in the bourse ledgers.
So pervasive is all manner of insider dealing that most foreign investors have thrown up their hands and exited our opaque market. Ordinary investors have been left carrying the can, their pensions decimated, their life savings rendered nearly worthless. To all this Mrs. Okereke-Onyiuke responded with a dismissive wave of her bejewelled hand: no investor has lost money in our stock market!
Not even all those layers of mascara can hide the face of a woman whose time has passed, whose continuing presence in her job has become utterly indefensible, and whose sole redeeming act now would be to spare everyone the trouble of having to fire her.
If Mrs. Okereke-Onyiuke, as we suspect, is too far gone to recognise that her time is up, the SEC must summon the courage to do the right thing.
We are confident that Udoma Udo Udoma, the SEC chairman and a distinguished former senator, will rally the organisation to fulfil its mandate of guaranteeing the market's integrity.
That will not be possible for as long as this woman remains in charge.[/QUOTE]