Prof. Segun Ajibola, a Professor of Economics, Babcock University, Ilishan-Remo, Ogun, has called on capital market regulators to initiate executive bills that will address unclaimed dividends and issue of beneficiary owners in the market.
Ajibola made the call on the sidelines of the Institute of Capital Market Registrars Inauguration of the new Governing Council, Investiture of Fellows and Induction of Associates in Lagos at the weekend.
He said that capital market regulators should initiate executive bills with the National Assembly to address some challenges in the market.
He said that the bills would become law to address the issue of beneficiary owners in the event of death or to address unclaimed dividends.
Ajibola said regulators should also compel registrars to update their registers periodically to solve issue of identity management in the capital market, thereby strengthening investors’ confidence.
“Regulators, apart from controlling infractions and other kinds of market misbehaviour, can also see what they can do to strengthen the confidence in the industry,” he said.
Ajibola, the immediate past President, Chartered Institute of Bankers of Nigeria, said the issue of identity management in Nigeria was still a major challenge in spite of Bank Verification Number (BVN).
“For capital market, now that we have the Central Securities Clearing System (CSCS), trying to manage stocks and shares online, there is the need to update information about shareholders regularly.
“Registrars should compare regular update of shareholders available to them.
“If it’s on a three-yearly basis where shareholders can come forward to update the information about themselves, either about address or size of family, location or number of shares.
“If this periodic update comes and in the event of death, the gap between the information available to the registrars and the accurate information will not be much,’’ he noted.
According to him, as at today, there is this issue of beneficiary ownership in the event of death.
“Some think the moment you are named a next of kin in any document, you automatically assume ownership of whatever the deceased left behind.
“This is not the position of the law. The next of kin ordinarily is somebody to contact in case of emergency.
“Most institutions either in the money market or capital market don’t have that provision for either an account owner in the bank or shareholder to registrar to supply the name and details of the beneficiary ownership in the event of death.
“So, there is always this confusion whenever someone dies either as a bank customer or as a shareholder. The bank or registrar may not even be in the know of the death.
“Where there is even the knowledge, to assume ownership is a problem in this part of the world,’’ he said.
Ajibola said: “If the person dies without a will, you need a letter of administration from the court to confirm that you are entitled to his or her estate.
“And letter of administration takes ages to get out of our court system in Nigeria.’’
He said that periodic update of shareholders records would reduce the problem of lost shares; shares that cannot be claimed by beneficiary owners in the event of death and incident of unclaimed dividends. (NAN)