SEC Nigeria Sponsored Individual key terms

The principal Nigerian statute governing the capital market, establishing the Securities and Exchange Commission and empowering it to regulate exchanges, dealers, issuers and collective investment schemes.

The apex statutory regulator of the Nigerian capital market, responsible for registering market operators, approving offers of securities and enforcing compliance with market rules.

Firms and individuals registered by the SEC to perform regulated market functions, including issuing houses, brokers, dealers, registrars, underwriters, fund managers and investment advisers.

A person who has passed the SEC's competence examination and is sponsored by a registered capital market operator to act as its qualified representative in a regulated function.

The SEC's assessment of honesty, integrity, competence and financial soundness applied to applicants and registered persons before and during registration.

The process by which a firm applies to the SEC for registration to carry on a regulated capital market activity, naming the sponsored individuals who will perform it.

The mandatory process of identifying a client, verifying identity from reliable documents and understanding the client's business and risk profile before providing services.

Ongoing measures to establish and keep current a client's identity, source of funds, nature of business and expected transaction pattern, scaled to the assessed risk.

Additional scrutiny applied to higher-risk clients and transactions, such as politically exposed persons, foreign accounts and unusual or large value transfers.

The natural person who ultimately owns or controls a client or the funds involved, or on whose behalf a transaction is carried out, and who must be identified.

A person entrusted with prominent public functions, or a close associate or family member, whose accounts and transactions require enhanced scrutiny and senior approval.

The framework of laws, rules and internal controls designed to prevent criminals from disguising the origin of illegal funds through the financial system.

A confidential report filed with the financial intelligence unit when a transaction appears unusual or has no clear lawful purpose, without tipping off the client.

Disclosing to a client or third party that a suspicious transaction report has been or may be filed, which is itself a criminal offence.

Assessing whether a recommended product or service matches the client's investment objectives, risk tolerance, financial situation and experience before making the recommendation.

A structured assessment of a client's willingness and capacity to bear loss, producing a risk category used to match products to the client.

A personal recommendation to a client about buying, selling or holding a specific security or investment product, given in the course of a regulated business.

A situation where a person's own interest, or a firm's or client's competing interest, could improperly influence the advice or service given to another client.

The legal obligation to act in the client's best interest, placing the client's interest above one's own and avoiding undisclosed personal gain from the relationship.

Funds held by an intermediary on behalf of clients, which must be kept separate from the firm's own money and handled under strict segregation and reporting rules.

The requirement to hold client funds and securities separately from the firm's own assets, usually in designated accounts, to protect clients on insolvency.

A firm that safekeeps clients' securities, settles trades on their behalf and maintains records of holdings, often through a central depository arrangement.

Nigeria's central depository and clearing infrastructure that holds securities in electronic form and settles trades between market participants.

The agreed period between trade execution and final transfer of cash and securities, typically expressed as T plus a number of business days.

The post-trade process of confirming, netting and discharging obligations so that securities and funds move between buyer and seller as agreed.

Carrying out a client's instruction to buy or sell securities, including best execution, timely allocation and accurate recording of the order details.

Temporary transfer of securities to a borrower, usually against collateral, for settlement or hedging purposes, with an obligation to return equivalent securities.

An arrangement pooling money from many investors to invest in a portfolio of assets, where investors do not control the day-to-day management of the investments.

A type of collective investment scheme that issues redeemable units to investors and invests the pooled money according to a stated objective and policy.

The total value of a fund's assets less its liabilities, usually expressed per unit and calculated at each valuation point for pricing subscriptions and redemptions.

A formal disclosure document issued with a public offer of securities, containing the information an investor needs to make an informed investment decision.

An invitation to the general public to subscribe for or purchase securities, which requires SEC approval and a compliant prospectus before it can proceed.

Information whose omission or misstatement could influence an investor's decision, and which must therefore be disclosed accurately and promptly.

The obligation of listed companies to keep the market informed of material developments as they occur, not only at the time of listing.

The SEC-issued principles and practices on board composition, independence, committees and accountability that guide Nigerian public companies.

The presence of non-executive directors free from relationships that could impair objective judgement, supporting effective oversight of management.

A board or shareholder-level committee that oversees financial reporting, internal controls and the independence and work of external auditors.

Trading or tipping others to trade in securities while in possession of material non-public information, which is prohibited market abuse.

Conduct that undermines market integrity, including insider dealing, market manipulation and false or misleading statements about securities.

The regulatory objective of safeguarding investors through disclosure, fair dealing rules, segregation of assets and accessible complaint and redress mechanisms.

The documented process by which an intermediary receives, investigates and responds to client complaints within set timeframes before escalation to the regulator.

The means of settling disagreements between investors and market operators, including internal review, mediation, arbitration or referral to the regulator.

A compensation arrangement that may pay eligible investors who suffer loss from the insolvency or default of a registered intermediary, subject to set limits.