The Legal Defence and Assistance Project on the 20th of January, 2016 filed an action at the Investment and Securities Tribunal against the Security and Exchange Commission and The Nigerian Stock Exchange challenging the power of the Security and Exchange Commission in allowing states government raise bonds in the open market.
The reason for this action is that the Investment and Securities Act in section 224(3)(a) made clear provisions on the conditions any state government must fulfil before it is granted loan or credit or bond in the capital market and these conditions are strict and ought to be followed and complied with strictly.
The claims sought by LEDAP are as follows;
- That the Security and Exchange Commission and the Nigerian Stock Exchange are not to allow state governments float bonds and other security and raise money from the public as this is in violation of the investment and security Act
- That the provisions of section 222,223,224,225,226 and the entire provisions of the Investment And Security Act which allows the government to raise fund from the public is unconstitutional
- An order restraining the defendants from authorising or raising funds and other securities for any state government in the capital market.
At the last proceeding, which came up on the 27th of February, all parties adopted their applications before the tribunal. The matter has been adjourned to the 22nd of May for Judgment.