Nigeria

NGX and the EFCC Want to Work Together More to Protect Nigeria’s Stock Market

The Nigerian Exchange Group (NGX) has approached the Economic and Financial Crimes Commission (EFCC) to increase efforts towards protecting the integrity of the Nigerian stock market. This move comes as a response to the evolving landscape of digital fraud and the increasing sophistication of financial crimes within the capital market.

Olufemi Shobanjo, the Chief Executive Officer of NGX, emphasized the necessity for this collaboration during a courtesy visit to the EFCC headquarters in Abuja. “The digitalization of markets has introduced new challenges,” Shobanjo stated. “We need to adapt our regulatory frameworks to combat these sophisticated financial crimes effectively.” He recalled a previous Memorandum of Understanding (MoU) from 2013 between the two bodies that had been effective but now needs to be revisited to address current threats.

The discussions centered on enhancing compliance with digital trading regulations and ridding the market of fraud, which has surged with the rise of digital transactions. Shobanjo highlighted that while NGX does not have criminal jurisdiction, the EFCC’s expertise in dealing with financial crimes is crucial for protecting market integrity and investor confidence.

In response, Ola Olukoyede, the Executive Chairman of EFCC, expressed readiness to collaborate more intensively. “We understand the concerns about regulatory compliance, which is a core part of our mandate,” Olukoyede commented. He also discussed the possibility of setting up a dedicated desk to facilitate better coordination between the two agencies.

The initiative is seen as a proactive step towards ensuring that the Nigerian capital market remains a safe and attractive environment for investors, especially in light of the significant market growth observed in 2024. This collaboration aims not only at enforcement but also at preventive measures, including enhanced market surveillance and investor education to foster a culture of transparency and compliance.

The joint effort between NGX and EFCC is expected to address issues like market manipulation, insider trading, and other forms of financial malpractices that could erode trust in the Nigerian financial markets. This partnership is also anticipated to lead to a review of the existing MoU to ensure it aligns with current legal and regulatory frameworks.

The collaboration has been warmly received by market analysts who see it as a strategic move to safeguard investments and maintain the market’s reputation amidst global financial scrutiny. It underscores a commitment to not only react to fraud but to anticipate and mitigate potential risks in a rapidly evolving digital economy.

As the Nigerian capital market continues to grow, this partnership could set a precedent for how regulatory bodies and financial institutions work together to uphold market integrity in Africa’s largest economy.

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