In from Success Allantee …
The Investors’ Protection Fund (IPF) of the Nigerian Stock Exchange (NSE) has concluded arrangements to pay a total of N42.23 million as compensations to 158 investors that had suffered pecuniary losses as a result of actions and inactions of stockbroking firms.
The 158 investors would share N42.23 million, with the maximum compensation capped at N400,000 in line with the approved rules of the IPF.
The board of the IPF on Wednesday stated the 158 claimants due to be compensated are investors whose claims were verified by the Exchange, approved by the board of trustees of the IPF, and whose identities were verified by an identity verification consultant engaged by the IPF.
According to the IPF, the 158 investors are being compensated for defalcation committed by 29 dealing member firms of the Exchange who are either inactive or have been expelled as members of the Exchange.
The claimants had been screened and found to be eligible for compensation in accordance with the relevant provisions of the ISA and the IPF rules. The IPF will advise all 158 claimants about the processes to receive their compensation payments.
Vice chairperson, board of trustees, Investors’ Protection Fund (IPF), Mr. Fubara Anga, said the fund had gone through a long, rigorous and transparent process and had worked in line with global best practices in reaching decisions on various issues regarding the IPF.
“First of all, we put in place an appropriate corporate governance structure for the Fund; we adopted Rules for the IPF and then following transparent and auditable selection processes, we appointed auditors as well as identity verification consultants. We then commenced the process of identifying claimants and verifying their claims. We must thank the claimants for their patience,” Anga explained.
Chief executive officer, Nigerian Stock Exchange (NSE), Mr. Oscar Onyema, who is also a trustee of the IPF, described the maiden payment as a milestone pointing out that the payment affirmed commitment to the continuous development of initiatives that will bolster confidence in the capital market.
According to him, though the compensation payment may not be a complete restoration, it is a show of good faith to investors.
The IPF is a statutory fund established pursuant to Part XIV, Section 197 of the Investment and Securities Act 2007 (ISA) to compensate investors who suffer pecuniary loss arising from the revocation or cancellation of the registration of a dealing member firm by the Securities and Exchange Commission (SEC), insolvency and bankruptcy or negligence of a dealing member firm of the Exchange.
The IPF also compensates for defalcation committed by a dealing member firm or any of its directors, officers, employees or representatives in relation to securities, money or any property entrusted to, or received or deemed received by the dealing member firm in the course of its business as a dealing member firm.
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