We’ll Sanction CMOs Frustrating e-Dividend Mandate Process—SEC
By Dipo Olowookere
The Securities and Exchange Commission (SEC) has threatened to sanction capital market operators (CMOs) found to be frustrating the e-dividend mandate process.
A few years ago, the agency, as part of efforts to find a solution to the perennial unclaimed dividend in the nation’s stock market, introduced the electronic registration and payment of the cash reward to the bank accounts of investors.
But despite this, some shareholders still find it difficult to get their return on investment because of some bottlenecks faced when processing the e-dividend mandate form.
Speaking at a post-Capital Market Committee (CMC) meeting press briefing webinar held Thursday, the Director-General of SEC, Mr Lamido Yuguda, said there should be no reason why new investors should have issues receiving their dividends.
He assured that the agency will continue to work towards resolving any legacy issues with unclaimed dividends, appealing to all stakeholders to comply with all directives of the commission in this regard, as defaulters would be sanctioned appropriately
“There is no reason why there will be unclaimed dividends for new investors or newly-listed companies adding every investor should be promptly paid his/her dividends upon declaration and payment.
“The commission has observed that certain Capital Market Operators (CMOs) frustrate the e-dividend mandate process.
“We have observed that the growth in the number of mandated accounts has been on the decline for some time.
“The capital market community has directed its e-Dividend Committee to engage with the Committee of Heads of Banking Operations to encourage better cooperation from banks as we tackle the challenges of unclaimed dividends,” he said.
Mr Yuguda said the commission has exposed new rules on the implementation of the e-dividend mandate and treatment of unclaimed dividends, adding that SEC was monitoring compliance and will not hesitate to sanction erring operators.
Recall that two weeks ago, Business Post reported about the experience of shareholders in accessing their dividends because of how some registrars allegedly frustrate the process.
“For more than one year now, I have not been able to get my dividends despite submitting all the needed requirements to the registrars.
“I did my e-dividend processing through my stockbroker, Meristem Securities, and out of the about five or six they processed for me, Veritas [Registrars] has responded and has paid my Zenith Bank dividend.
“The others have not cleared up till this moment. This is not encouraging at all because it has almost killed my appetite for dividend stocks,” an investor in the stock market, Mr Aigbe Osas, had lamented to Business Post in a report that the unclaimed dividend of Dangote Cement had reached N4 billion as at December 31, 2020.