By Chinwendu Obienyi

Last weekend’s revelation by the Securities and Exchange Commission (SEC) that the country’s unclaimed dividend has now risen to N170 billion has sparked off concerns among shareholders in the Nigerian Capital Market (NCM) that thefunds may be appropriated by Nigeria’s financially challenged Federal Government.

This is even as they urged the Commission to quickly innovate new strategies to reduce the figure.

The shareholders renewed call on SEC is coming after its efforts to tackle the rising unclaimed dividend trend in the nation’s capital market failed to hit the right cord as the Commission on Friday, announced that the figure had risen to N170 billion as at December 2020 from N158.4 billion recorded in 2019. 

Daily Sun investigations showed that from as little as over N2 billion in 1999, the figure rose sharply to N158.4 billion at the end of 2019, an increase of 32 per cent from N120 billion recorded in 2018.

Speaking during a virtual Capital Market Committee Meeting held in Lagos at the weekend, Director General of the SEC, Lamido Yuguda, linked the rising figure to irregularities on identity management and multiple subscriptions from investors.

Yuguda expressed dissatisfaction on the development, assuring that the SEC would adopt all-inclusive approaches to stem the tide and boost investor’ confidence.

Already, he disclosed that the Commission has constituted a committee on identity management expected to harmonise various databases of investors and facilitate data accuracy in the market. 

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According to him, the outcome of the committee’s assignment would address the challenges of identity management and help tackle some of the issues of unclaimed dividend, direct cash settlement and multiple subscription. 

“There is a problem with the e-dividend process and with us too as a people because if you are buying securities using your own wealth, why will you use another persons name, why will you use a name that will not be traceable to you. “This became an issue after the introduction of Biometric Verification Number (BVN) because BVN is tied only to one name,” Yuguda said.

On the Electronic Dividend Mandate Management System (e-DMMS) portal, the SEC DG said that the total number of mandated and approved accounts since inception in 2016 to July 2021 stood at 1,144,970, noting that COVID-19 pandemic impacted negatively on the registration exercise.

However, he assured that members of the CMC had adopted some measures to increase the number of mandated investors on the e-DMMS and reduce the quantum of unclaimed dividends in the market.

In November 2020, the House of Representatives, had projected there would be  about N200 billion unclaimed dividend in the country by the end of that year.

The Chairman, House Committee on Capital Market, Babangida Ibrahim,  had stated this at an investigative hearing on “The Need to Investigate the Rising Value of Unclaimed Dividends, Unremitted Witholding Tax on Dividends and their Attendant Effects on Nation’s Economy,”  adding that the development was worrisome.

But in a telephone chat with Daily Sun, at the weekend, the National Coordinator, Progressive Shareholders Association of Nigeria (PSAN), Boniface Okezie, attributed the situation to the weak economic system of the country as well as lack of strategies in solving the issue.

His words, “SEC is just wasting its time and energy in wanting to appropriate the money as it clearly doesn’t belong to them or the government. We have told them to remove that law that if after 12 years, dividends are not claimed, then it will go to the company that declares it and this is not right. These are returns on people’s hard work and labour. I believe people got discouraged because they felt the government was clearly cheating them or the process was cumbersome.”