By The Nation Reporter (Yusuf Alli), Abuja
House of Representatives
There seems to be no let-up in the battle of integrity between the House of Representatives and the Securities and Exchange Commission (SEC).
The SEC yesterday denied embattled lawmaker Herman Hembe’s claim that it initiated moves to give the House Committee on Capital Market and Institution N30.4 million.
It claimed that it was the committee under Hembe’s leadership that approached the SEC on February 29 through Messrs Note Worth Consultants for financial assistance.
There were indications yesterday that the SEC board may be invited for questioning by the Economic and Financial Crimes Commission (EFCC) over the N30.4 million ‘donation’ to the committee.
Hembe and members of the committee were dropped on Tuesday over the claim of Ms Aruma Oteh, the SEC Director-General, that they demanded N44million bribe from her.
In an unsigned document circulated in Abuja, SEC alleged that the “consultant visited the SEC in the company of Mr Olufemi Ogunsanya, clerk of the committee with a ‘shopping list’ detailing a large number of ‘specific areas’ for which the SEC’s help was being sought”.
The document added: “Given that the SEC believed that the hearing was indeed in the interest of the public and investors as expressed in a letter through which the commission was formally informed of the hearing, the request was subjected to SEC’s decision making procedure, which culminated in the Board’s consideration for N30m.
“What raised suspicion in the commission was when, on March 14, 2012, barely one day to commencement of proceedings, this same Olufemi Ogunsanya, Clerk to the House Committee on Capital Markets and other Institutions, visited the SEC under the instruction of Hon. Herman Hembe to demand the sum of N5million in cash, being part payment of the erstwhile N39.844million ‘support’ which Hembe had earlier sought.
“The SEC smelt a rat that rather than wait for the payment to be made through electronic transfer, in line with extant public service policy, to an institutional account, the man was seeking undocumented payment by cash. This was why the transfer was suspended.”
It noted: “In tendering the SEC memo, which was stolen after dark, like most other documents from the SEC’s records, the memo’s accompaniments, which included the Hembe ‘list of requirements for the public hearing’, was carefully detached. Even the least cursory look at the memo will see stapler marks on the top left hand corner of its cover page, evidence that its accompaniments had been detached!”
The statement said Hembe avoided direct formal communication with the SEC on the subject, adding that he forgot, however, that the “list of requirements” for which he solicited support from the SEC was formally received.
“He also forgot that the letter of introduction for Messrs. Note Worth Consultants in which the SEC had been asked to ‘kindly avail him all necessary assistance ...’ was signed by one Abama Thomas, Asst. Committee Clerk on behalf of the Chairman.”
Hon. Hembe also excised the fact that he collected estacode and a first class ticket for a trip to the Dominican Republic to attend a regulators’ conference for emerging markets from the SEC in October 2011. He has tendered ‘evidence’ of travel to somewhere other than the Dominican Republic! The implication is that he diverted public resources to personal ends to the detriment of capacity building in the capital market.”
Also yesterday, it was learnt yesterday that the House of Representatives is crying foul over what it described as the “sudden appearance” of SEC’s official stamp on the list of items requested from the commission by the committee.
While SEC claimed that the committee forwarded the list of items to it, the lawmakers are arguing that there was no official correspondence to that effect.
Investigation by our correspondent revealed that the EFCC and the Committee on Ethics and Privileges may interact with the Board members. The interaction, sources said, became imperative since the Board described the N30.4 million as ‘donation’.
A source said: “We are studying all memos, issues and meetings that have to do with the problem between SEC and the committee.
“We will invite all stakeholders. So far, it appears that the decision on the N30million was taken by many people. We will be fair in hearing from all of them.
“What we have heard so far is that the money was a donation from SEC to the House Committee. Just give us time to investigate all claims.”
A March 13 memo from the SEC Secretary, E.K. Aigbekaen, to the Executive Commissioner (Finance and Administration), which confirmed that the Board approved the money for the Committee, may have conformed the planned interaction with EFCC.
The memo reads in part: “The Board of SEC at its 63rd meeting held on Monday 12th March, 2012 considered a proposal by management for the commission to financially support a public hearing on the Nigerian Capital Market by the House of Representatives Committee on Capital Market and Institutions, scheduled to take place from 13th-30th March, 2012.
“After due deliberations, the Board approved a maximum of N30million as donation by the Commission to the House of Representatives Committee on Capital Market and Institutions to enable it undertake a public hearing to identify the manifest causes of the near collapse of the Capital Market with a view to finding lasting solution.
“The Board further directed that Management should work out the details of the areas of sponsorship with the House Committee.”
On the appointment of a consultant for the public hearing and the list of items, a source in SEC said: “Going by what we have on record, the House Committee sent the list of items to us on February 29, 2012.
“You can see the stamp on the document accordingly.”
But a highly-placed source in the House, said: “In the list of the memos which the House released to the public on Tuesday, the list of items required for the public hearing was not stamped.
“We are suspecting an emergency stamping of the list by SEC. That in itself is forgery. We hope the anti-graft agencies will take note of this trend.”
The SEC source, however, disputed the claim.
He said: “Did we not meet with the House Committee to get the list of items required for public hearing? Could we have just compiled the list on our own?
“After agreeing to the list, they also wrote a memo to the DG of SEC on the appointment of a consultant, Note Worth Consultant for the public hearing.
A March 14 letter to the DG of SEC, signed by the Assistant Committee Clerk, Abama Thomas, reads: “The committee has appointed Messrs Note Worth Consultant as a consultant to the Committee on the public hearing. Kindly avail him all the necessary assistance please. Accept the Committee’s warm regards.”