Court fines 21 companies N630 million for illegal investment activities

The Federal High Court in Lafia, Nasarawa State, on Monday, found 21 companies guilty of operating without licenses from the Securities and Exchange Commission (SEC).

Trial judge Anyalewa Onoja-Alapa ordered the companies to pay N30 million each, totaling N630 million. She also directed them to pay N200,000 for each day they broke the law.

The companies involved include Ngwuoke Daniels Technologies, Credio Banco Ltd, Digital Company Ltd, Co Request Capital Nigeria Ltd, Mega Drop Quality Stores Ltd, Norland Global Ltd, Oxford International, Creative Agriculture Cooperative, Qnet Nigeria Ltd, Qnet Professional Skill Academy Ltd, and Mastermind Energy & Agro Nigeria Ltd.

Others on the list are Atus West Africa Investment Company, Eatrich360 Farms, Matag Agro General Services, Viables X Agribusiness Ltd, Kwakol Markets Ltd, Light Shade International Ltd, Value Growth Ltd, B12 Synergy Nigeria Ltd, Phresh Farm Ltd, and Omega Pro Global Resources.

The Economic and Financial Crimes Commission (EFCC) said in a statement on Monday that it charged the companies on 15 and 16 September for illegal operations. This act goes against Section 57 (1) of the Banks and Other Financial Institutions Act of 2020.

This section states that “no person shall carry on specialized banking or business of other financial institutions in Nigeria other than insurance, pension fund management, collective investment schemes, and capital market business as defined in the Insurance Act, the Pension Reform Act, and the Investment and Securities Act unless it is a company duly incorporated in Nigeria and holds a valid license granted under the provisions of this Act.”

Each company faced one count. For instance, the charge against Megadrop Quality Stores Limited and Ngwuoke Daniels Technologies mentioned that even though they were registered with the Corporate Affairs Commission (CAC), they engaged in "financial investment management without valid license from the SEC."

The EFCC’s statement noted that none of the companies appeared in court to plead. This led the anti-graft agency’s lawyer, Nasir Umar, to ask the court to enter a not-guilty plea for the 21 companies.

The judge accepted this, and the trial began. The EFCC presented witnesses and evidence against the companies. The evidence included “intelligence reports, statements from the investigating officers, letters about investigation activities, responses from CAC, and responses from SEC.”

The EFCC stated that its investigations into the companies started due to “actionable intelligence available to the Commission that linked them to investment fraud and operating without a license.”

During the investigations, the EFCC questioned the promoters of the companies in December 2022 and January 2023, but they did not respond to the invitations, according to the statement.

The commission added that they avoided interrogation for five years. The promoters were invited for questioning on 22 December 2022 and on 12 January 2023, but they ignored the invitations.

After the EFCC presented its case in court, the judge convicted and sentenced the companies. The SEC has warned Nigerians to be careful about investing in companies that do not have a valid license.