Stockbrokers Block Investors from Trading Over KYC Update

November 4, 2020
Morgan Capital

By Dipo Olowookere

Some investors in the Nigerian stock market have been blocked from trading shares over their failure to update their Know Your Customer (KYC) form.

The Securities and Exchange Commission (SEC) had directed stockbrokers in the nation’s capital market to get the latest information of their customers.

The apex capital market regulator also mandated the brokerage firms to prevent clients who failed to provide the update from trading. Investors were given till October 31, 2020, to provide the necessary information or be blocked from trading from November 1.

Business Post gathered that many dealing firms sent out notices to their clients, informing them of the last decision from the regulator and requested them to fill and submit the completed KYC update form.

One of the popular brokerage firms, Morgan Capital, in its notice said, “In line with the requirement of investors/shareholders account information update by the Securities and Exchange Commission (SEC), all capital market investors are required to update their KYC, if they have not, on or before October 31, 2020.

“The information on the KYC Form must include Bank account details: Bank Name, Bank Account Name, Bank Account Number, Bank Verification Number (BVN) and Telephone number and/or Email address.

“The same requirement applies for minors, directors and/or signatories to corporate account and administrator(s) to estate account.

“Valid means of identification, utility bills and other relevant KYC documents are still required to process account opening or KYC update.

“It is mandatory that this information is provided before we can carry out any instruction including trade execution, lest we would be sanctioned by our regulator.

“Kindly scan duly filled out KYC form and forward same to [email protected] so that your existing data is updated in line with the directive of SEC.

“Please note that the deadline date stipulated by SEC still remains October 31, 2020.”

From information scooped by Business Post, some investors were prevented from trading at the beginning of this month when the implementation of the new policy became effective. A few of them were allowed to carry out a trade action after complying with the directive.

It was learned that the move by SEC was to monitor the flow of funds into the capital market.

Dipo Olowookere

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

Mr Olowookere can be reached via [email protected]

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