The panel, which described Oteh’s letter to the committee requesting to be exempted from Tuesday’s sitting as “arrogant,” ordered her to appear before it by 10am on Wednesday (today) unfailingly.
Oteh had appeared before the Ibrahim El-Sudi-led panel on Monday where she accused the former Director-General of Nigeria Stock Exchange, Prof. Ndidi Okereke-Onyiuke, of financial mismanagement during her tenure as head of NSE.
She was asked to return on Tuesday to continue with her presentation.
She stayed away, and instead, wrote the panel, asking for permission to attend to other issues. She also requested to be exempted from physical appearance at the panel’s sittings as she would prefer to respond to further enquiries by the committee in writing.
In her letter read to panel members by El-Sudi, Oteh explained that she would be attending a meeting of the National Economic Management Team on Tuesday.
She also recalled that the commission had entered appearances before the panel since April 17, a reason Oteh said “forced me and the Commission to cancel and in several cases reschedule important official commitments.”
Part of the letter reads, “I, therefore, crave your indulgence to permit me to respond to any additional questions that you have in writing, being that you had already given the Commission an opportunity to present and interact with the Committee for five hours yesterday…”
But the content of the letter infuriated lawmakers, who saw Oteh’s response as “arrogant” and an attempt to ridicule the National Assembly.
Giving the panel’s ruling on the letter, El-Sudi ordered Oteh to appear before the committee unfailingly on Wednesday (today).
El-Sudi stated that the panel had been fair to all stakeholders since the hearing started and expressed surprise at Oteh’s conduct.
He said, “The content of the letter to this committee has an aura of arrogance and looks down upon the integrity and authority of the National Assembly.
“We will not sit here and allow anybody, no matter how powerful or strong, to undermine the National Assembly.
“The National Assembly is not an arm of the Executive.
“Appearance before this committees or any of the National Assembly committee is not a matter of personal idiosyncracy or discretion…
“Ms Arunma Oteh is hereby ordered to appear before this committee by 10am tomorrow, May 9 unfailingly, otherwise, we shall be compelled to invoke the necessary provisions of the law.”
‘No money to steal’
Meanwhile, Okereke-Onyiuke, appeared before the panel on Tuesday to speak on her role in the capital market crisis. She attributed the crisis in the capital market to the activities of the Securities and Exchange Commission and some commercial banks.
Okereke-Onyiuke, who explained that she would not comment on certain issues because of pending cases in courts, seized the opportunity to respond to allegations raised on Tuesday by the DG SEC and offered her perspectives on how to revive the capital market.
Oteh had, during her presentation to the committee on Monday, alleged that the NSE council, under Okereke-Onyiuke’s leadership, misappropriated over N1.5bn.
Okereke-Onyiuke explained that the money was generated from “fees”, which the shareholders agreed to spend on hosting the NSE 48th anniversary.
“It is not anybody’s money; the stock exchange doesn’t take public funds.
“This is a private organisation that makes money from operating fees and bonuses.
“You don’t ask somebody, how do you spend your money? We didn’t steal anybody’s money,” she stated.
‘AGM approved
The former DG also responded to Oteh’s allegation that the NSE spent
N186m on 165 Rolex wristwatches, but could not account for 92 of the
wristwatches valued at N99.5m.She explained that the watches were bought for awardees who had spent 48 years in the exchange.
According to her, the expenditure was approved by the Annual General Meeting of the NSE, after it had also adopted the audited accounts of the organisation.
Okereke-Onyiuke, therefore, described the allegation as “pure fabrication to support the illegality of the invasion of the NSE by SEC in August 2010.”
“So, it was shocking to me when people came to talk to the committee about issues that were purely private.
“It was all to justify the illegal invasion of the NSE by armed policemen from SEC,” she added.
She drew the attention of the panel to four court decisions declaring her sacking as illegal, but which had been ignored by SEC till date.
“The so-called Forensic Report, which SEC used as a reason for their illegality, was also declared null and void by the courts.
“A Federal High Court declared that the content should not be made public, but again, that has been flouted by the information you were given yesterday,” she told the panel.
Commenting on why the market crashed in 2009, Okereke-Onyuike blamed it primarily on the crisis in the banking industry.
“The banks controlled 60 per cent of quoted securities; so when they had a problem, it affected the market. No other quoted companies had a problem,” she told the panel.
“It was merging loans that destroyed the market.
“Private placements also created problems because these were companies approved by SEC but not listed on the stock exchange,” she added.
Capital market needs bailout
On how to revive the capital market, she suggested a bailout by the Federal Government just as it did for the banking sector.According to her, commercial banks which accounted for 60 per cent of listed securities in the market granted indiscriminate margin loans to all manner of investors and market operators without helping them to manage such loans.
She said, “The regulators of government, which is CBN and SEC, did nothing at that time to warn the public.
“But the NSE on several occasions engaged in newspaper advertisement to advise and warn innocent shareholders that there was no guidelines for margin loans in Nigeria.’’
She said that there were a series of discussions leading to the creation of Asset Management Company of Nigeria.
She explained that part of the decisions taken was that government should bail out the banks and the capital market.
However, she expressed concern that when the bailout came, it was only to the banking sector, to the exclusion of the capital market.
“A strong government bailout is needed to rescue the market, just like the government did through AMCON for the banks.
“Urgent action has to be taken on this rather than serving only the banks and excluding the capital market,” she said.
Responding to questions from the panel on the status of the Nigerian Telecommunications Limited and Transcorp, she said that the NECOM building and NITEL were part of the same entity.
She warned the government against the purported sale of the building under the guise that the structure was not part of NITEL.
Okereke-Onyiuke said, “I am speaking from the position of facts, as somebody who knows. The engineer who handled the project gave me this information; all the details.
“Anybody who owns NECOM building automatically owns NITEL; the SAT-3 Cable is buried right under the building, so you cannot separate the two.”
Okereke-Onyiuke, who made references to reports that a certain highly-placed politician had bought the building, suggested that the transaction should be reviewed urgently in the national interest.
The former NSE boss told the committee that she could not present any document to it in respect of the allegation made by the SEC boss on Monday.
She blamed this on the fact that her office was raided and vital documents carted away by security men at the instruction of Oteh.
Alhaji Aliko Dangote and Femi Otedola who were expected to present their positions on the capital market were absent at the hearing.
Okereke-Onyiuke lied – SEC
However, in a swift reaction, SEC said that a number of claims made by Okereke-Onyiuke were false and misleading to the general public.
This was contained in a statement by the Communications Adviser, SEC, Mr. Obi Adindu, on Tuesday.
The statement said, “A number of the claims made by the removed DG of the NSE in the course of proceedings at Tuesday’s public hearing were downright false and deserve quick refutation and rebuttal so that the investing and general public as well as the public records do not retain such falsification.
“On the May 20, 2011 judgment of Justice Idris Mohammed of a Lagos High Court, Okereke-Onyiuke claimed that the SEC only appealed the award of N500m to Okereke–Onyiuke in damages.
“This is entirely false because the appeal filed by the SEC was against the entire judgment. The appeal challenged both the substantive judgment as well as the award of N500m which was not sought for by Okereke-Onyiuke. Given the fact of this appeal therefore, her claim to being the DG of the NSE is clearly false.”
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