SEC Strikes Oando’s Wale Tinubu, Others after Investigations – Barred and asked to Resign

The Securities and Exchange Commission (SEC) has ordered Oando Group CEO Wale Tinubu,  and other senior executives, to resign. They are also barred from being directors of public companies for 5 years.

The Securities and Exchange Commission has concluded its investigation of Oando Plc and ordered the Group Chief Executive Officer of the company, Mr. Wale Tinubu, and other affected board members to resign.

SEC, in a statement on Friday, also said it barred Tinubu and the Deputy Group Chief Executive Officer of the company, Mr. Omamofe Boyo, from being directors of public companies for a period of five years.

It also directed the convening of an Extraordinary General Meeting on or before July 1, 2019 to appoint new directors.

According to the Commission, these, among others, are part of measures to address identified violations in the company.

SEC said, “Following the receipt of two petitions by the Commission in 2017, investigations were conducted into the activities of Oando Plc (a company listed on the Nigerian and Johannesburg Stock Exchanges).

Meanwhile, the court reinstated the suspended DG of SEC, Mounir Gwarzo, yesterday. No one knows if he has resumed duties already.

The National Industrial Court, Abuja, on Thursday ordered the immediate reinstatement of Mounir Gwarzo, the suspended Director-General of the Securities and Exchange Commission (SEC), back to his position.

Justice Sanusi Kado, in his judgment, held that the minister of finance, named as the second defendant in the suit, lacked the power to suspend the claimant.

Mr Kado, who dismissed three issues raised by defence counsel through their preliminary objection, ruled that the suit was not status barred.

The Investigations

Investors and market players had alleged some corporate governance issues against Oamdo and leaders. You can download reporting on them here. Here is a summary when Oando shares were suspended.

1. Download Full (PDF) Report – Memo to The Market: The Oando Corporate Journey – At The Regulators Gate
2. Download (PDF) Report – SEC Technical Committee on Oando Plc 2017 (Dec 04, 2017)
3. Review of the SEC Technical Committee Recommendations, Opinion and Final Report

The SEC Suspension Letter

Following the receipt of two petitions by the Commission in 2017, investigations were conducted into the activities of Oando Plc (a company listed on the Nigerian and Johannesburg Stock Exchanges). Certain infractions of Securities and other relevant laws were observed. The Commission further engaged Deloitte & Touche to conduct a Forensic Audit of the activities of Oando Plc.

The general public is hereby notified of the conclusion of the investigations of Oando Plc. The findings from the report revealed serious infractions such as false disclosures, market abuses, misstatements in financial statements, internal control failures, and corporate governance lapses stemming from poor board oversight, irregular approval of directors’ remuneration, unjustified disbursements to directors and management of the company, related party transactions not conducted at arm’s length, amongst others.

As part of measures to address these violations, the Commission has directed as follows:

1. Resignation of the affected Board members of Oando Plc,
2. The convening of an Extra-Ordinary General Meeting on or before July 1, 2019, to appoint new directors,
3. Payment of monetary penalties by the company and affected individuals and directors,
4. Refund of improperly disbursed remuneration by the affected Board members to the company,
5. Bar of the Group Chief Executive Officer (GCEO) and the Deputy Group Chief Executive Officer (DGCEO) of Oando Plc from being directors of public companies for a period of five (5) years.

As required under Section 304 of the Investments and Securities Act, (ISA) 2007, the Commission would refer all issues with possible criminality to the appropriate criminal prosecuting authorities. In addition, other aspects of the findings would be referred to the Nigerian Stock Exchange (NSE), Federal Inland Revenue Service (FIRS), and the Corporate Affairs Commission (CAC).

The Commission is confident that with the implementation of the above directives and introduction of some remedial measures, such unwholesome practices by public companies would be significantly reduced.

Therefore, in line with the Federal Government’s resolve to build strong institutions, Boards of public companies are enjoined to properly perform their fiduciary duties as required under extant securities laws.

The Commission, as the apex regulator of the Nigerian capital market, maintains its zero tolerance to market infractions, and reiterates its commitment to ensuring the fairness, integrity, efficiency and transparency of the securities market, thereby strengthening investor protection.

Signed

Management

May 31, 2019

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