When a dividend is not claimed by the shareholder for any reason, it contributes to the incidence of unclaimed dividends. According to CAMA , dividends are considered unclaimed after 15 months from the date of declaration.
The move, rather than boosting transaction processes, instead heightened the delay; accompanied by irregularities that also encouraged fraud, with attendant loss of share certificates, delay in receipt of dividend warrants, notice of meetings, and companies’ annual report. Aside updating their details, the University Don also suggested that shareholders should also be made to provide details of beneficiaries of the dividends to the registrars in the case of death.
“Shareholders should be encouraged to embrace e-dividend platforms. Payment of dividends directly to the bank accounts of shareholders by the registrars would reduce the problems posed by changes in the contact addresses of shareholders. Registrars and SEC and other regulatory bodies in the Nigerian capital market should mount regular training to this effect.”
Consequently, such shareholders are virtually cut off from the companies and do not know what is going on with their investment nor can they participate in the company’s activities, as envisaged in the Companies & Allied Matters Act 1990, and Investments & Securities Act 1991. The Commission, saddled with the primary responsibility of investor protection has repeatedly introduced initiatives to ensure that investors are not denied their right of investing in the capital market.
She said: “Right now, you will not get unclaimed dividends from new issues. Part of the problem of unclaimed dividends has to do with identity management, and we are doing all we can to educate the public, and engaging the various stakeholders to be able to get a lot of the information that we require.”
“Before 2008, we had a lot of Nigerians who bought shares in the capital market, and at that time we did not have BVN numbers. Even some of them did not provide their account numbers. What was agreed was that we would update information of such shareholders. That information will be transmitted to the CSCS, who will update their own information and send them to the registrars.”
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