Verify Compliance Status Of Operators, SEC Urges Investors | Independent Newspapers Limited
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Verify Compliance Status Of Operators, SEC Urges Investors

Posted: Oct 5, 2015 at 12:03 am   /   by   /   comments (0)

By Bamidele Ogunwusi, Lagos

The Securities & Exchange Commission (SEC), on Sunday urged the investing public to ensure to verify the compliance status of capital market operators by checking the list on its website, before doing business with any forthwith.

The Securities & Exchange Commission (SEC)The Commission announced that as at close of business September 30, a total of 437 operators had met the requirement, while there were four pending merger applications.

A statement by the Secretary of the Market-wide Implementation Committee on new minimum capital requirement also listed some guidelines that investors, target firms and the Central Securities Clearing System (CSCS) must adhered by, where an investor wishes to move his stock account from an under-capitalised Broker/Dealer to that of a compliant firm.

According to the statement, “Where the Broker/Dealer has not met the new minimum capital requirement, the investor should approach a capitalised Broker/Dealer or Broker for engagement: The investor should undergo a Know Your Customer (KYC) process with the new firm.

“The Broker/Dealer or Broker should open a CSCS account for the investor using the investor’s existing Clearing House Number (CHN) from his former Brokerage Firm, The investor should give a mandate to the target firm to transfer his/her account from the under-capitalised firm to the Target firm (capitalised firm), and the investor should submit evidence of purchase of the shares such as contract notes, receipts of purchase, dividend stubs or confirmation of holdings from the Registrar’s office, signed by the Managing Director of the Registrar firm to the target firm.

Other aspects of the guidelines provide that “The Target firm (capitalised firm) should initiate inter-member transfer request, The Managing Director of the Target firm (capitalised firm) shall go to the CSCS to sign off the indemnity form and the CSCS shall process the request and notify the Broker/Dealer or Broker through the CSCS website.