Reps to probe domestic banks’ solvency level
The House of Representatives is set to conduct investigation into the solvency of all the licensed domestic banks operating across the country, BusinessDay gathered at the weekend.
The proposed investigation to be conducted by House Committee on Capital Market and other Institutions, is coming on the heels of recent take-over of Skye Bank Plc by Asset Management Corporation of Nigeria (AMCON).
Tony Nwulu, Deputy Chairman, House Committee on Capital Market gave the hint while addressing Chief Executive Officers of some of the insurance companies operating in the country.
“We will do everything possible to make sure Nigerians do not lose money and their jobs. We will expose the banks the way we have exposed the insurance companies. Let it be on record that we have invited First Bank severally, but they have refused to respond,” Nwulu added.
In a related development, the House Committee on Capital Market sub-Committee mandated to probe the allegation d infractions by insurance companies has harped on the need for Securities and Exchange Commission (SEC) to constitute an interim board that will take-over the management of three insurance companies indicted for flouting industry regulations, tax evasion and other infractions.
The affected companies namely: Great Insurance Plc, Consolidated Hallmark Insurance Plc and Staco Insurance Plc allegedly engaged in insider dealings, non-payment of dividends to shareholders, tax evasion and breach of corporate governance.
“We interfaced with the insurance companies. The process has led to the uncovering of a whole lot within the insurance sector, which we will also make public. Those that believe that other people’s money is free for all, we will ensure that no matter how highly placed they are, they will not be speared.
“Most of the insurance companies that came have defaulted in paying dividends; only few paid. We also discovered a whole lot of infractions bothering on corporate governance and insider dealings.
“After the committee finishes its work, there are some that we will mandate SEC to quickly take over their management. We have identified some that are just struggling, but answering big names and are in contravention of a lot of things, including taxes.
“Great Insurance Plc, Consolidated Hallmark Insurance Plc and Staco Insurance Plc fall in this category. Some directors and chief executive officers have companies that do business directly with the insurance company they head. Some are in violation of SEC and Nigeria Insurance Commission (NAICOM) regulations,” he explained.
According to the lawmaker, the sub-committee will further proceed to invite SEC, NICON, NLC, shareholders and law enforcement agencies to participate in subsequent investigative hearings to expose non-compliance with regulations in any sector of the capital market.
“We want them to come and explain to Nigerians and the shareholders what they have been doing with their money. We will leave no stone unturned,” the lawmaker said.
While giving update on the crisis trailing Capital Oil PLC, Nwulu disclosed that the Committee has mandated SEC to reconstitute an interim management for Capital Oil Plc after it uncovered infractions committed by the management of the firm.
To ensure that none of the culprits evade justice, Nwulu explained that the House will soon communicate its resolution to the Interpol to arrest and extradite fleeing former management staff of the company.