Forensic audit: SEC sacks, bars Oando CEO, deputy for five years

The Securities and Exchange Commission (SEC) has out with come out with findings on forensic investigations of Oando Plc over underhand dealings and directed among others the resignation of the affected board members.

The Commission also barred the company’s Group Chief Executive Officer (GCEO), Mr Wale Tinubu and his Deputy Group Chief Executive Officer (DGCEO), Omamofe Boyo from being directors of public companies for a period of five years.

Some shareholders of the company were relentlessly protested against the board remaining in place when a forensic audit was ongoing.

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

These among others, SEC stated, are part of measures to address identified violations in the company.

According to SEC, “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”.

SEC also directed the payment of monetary penalties by the company and affected individuals and directors, and refund of improperly disbursed remuneration by the affected Board members to the company.

As required under Section 304 of the Investments and Securities Act, (ISA) 2007, the Commission said it would refer all issues with possible criminality to the appropriate criminal prosecuting authorities.

In addition, the SEC stated that 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 statement added.

In 2018, the shareholders called for the suspension of the top management and board officials to make room for a thorough and hitch-free forensic audit, in their quest to ascertain the level of rot embedded in the business.

They called on the National Assembly to mandate both the then Minister of Finance, Mrs. Kemi Adeosun and the Acting Director General of the Securities and Exchange Commission (SEC), Abdul Zubair to flush out the management to allow for an interrupted audit.

The Chairman, Trusted Shareholders Association of Nigeria, Alhaji Mukhtar Mukhtar, wondered why the government will leave the management of a company it investigated and found to have engaged in underhand dealings to remain in office during a forensic audit.

“How can you leave a management you investigated and found to have issues to clear on the saddle during a forensic audit. It’s never done anywhere. They are to be suspended pending the duration of the audit and if they are without blemish, they return but if guilty, let the law take its course.

“We all remember the former SEC DG who insisted on this forensic audit, they leveled some allegations against him and he was suspended pending the outcome of the Administrative Panel of Inquiry. Why can’t the Oando management be suspended? This smells of bias and we worried about it.

“Now, an acting SEC DG has been appointed but he seems scared to insist that the management be suspended pending the audit outcome. They said the audit is continuing but nothing is happening and we are here to put pressure on regulatory authorities to do the needful”, he had complained.