Insurance

Cornerstone Insurance, 20 others pay N52.8m fine

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Chuks Udo Okonta and agency report

The Nigerian Stock Exchange (NSE) has imposed a fine of N52.8 million on Cornerstone Insurance Plc, Staco Insurance Plc and 19 other companies over default in filings financial statements.
The NSE said the sanctions were applied in accordance with the provisions of Section 14 of Appendix iii of the listing rules on listed companies that filed their audited and interim financial statements after the regulatory due date.

Other companies that were unable to meet the regulatory requirements ranging between full year ended December 31, 2014 and first quarter ended March 31, 2016 include African Alliance Insurance; ASL, Conoil; Daar Communication; DN Meyers; DN Tyre & Rubber; ECO Transnational Incorporated (ETI); Equity Assurance, FBN Holdings; Flour Mills; Fortis Microfinance Bank; Great Nigeria Insurance; Japaul Oil Maritime Services and Presco.

Standard Alliance Insurance plc; Smart Products; Tripple Gee and May and Baker Plc completed also made the list of defaulters.

A breakdown of the penalties imposed on each company revealed that Great Nigeria Insurance, Daar Communication, DN Tyre & Rubber and African Alliance Insurance Plc got N43.6 million of the fines, which accounted for 83.04 percent of the total amount.

Conoil was fined N2.3 million for defaulting in its full year audited 2015 results, while other companies had fines ranging between N700,000 to N100,000.

The NSE’s report released on a weekly basis, explained that every listed company is required to provide The Exchange with timely information to enable it efficiently perform its function of maintaining an orderly market. It further stated that the initiative was designed to maintain market integrity and protect the investors by providing compliance-related information on all listed companies.

“Companies that are listed on the Exchange are required to adhere to high disclosure standards, which are prescribed in Appendix 111 of the Listing Rules.

“Financial information, which is periodic disclosure and on-going material events disclosure, should be released to the Exchange in a timely manner to enable it efficiently perform its function of maintaining an orderly market,” the report stated.

On why regulators fine operators, the Commissioner for Insurance and helmsman of National Insurance Commission (NAICOM) Mohammed Kari, said insurance is a regulated business, hence any operator who chooses to play in the sector must be prepared to do so in strict compliance with the extant insurance laws.

He noted that fines and sanctions for any default/infraction by an operator are clearly spent out in the respective laws to the knowledge and understanding of the operators, adding that the law may not be perfect, but as long as it remains the law, its provisions must be complied with and it is the responsibility of NAICOM, as the statutory regulatory agency of the sector to ensure every operator play by the rule.

He also advised shareholders of insurance companies to demand explanations from their respective managements to ascertain reasons they continue to incur sanctions from the regulator.

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