28 October 2007

Nigeria: Court Injunctions Stall Cadbury's Sec Probe

Lagos — THE Securities and Exchange Commission (SEC), the apex capital market regulator, has lamented that the court injunctions obtained by parties involved in the case of alleged misrepresentation of financial statement against Cadbury Nigeria Plc were preventing its Administrative Proceeding Committee (APC) from hearing the case.

It, however, assured that it will come out with its report on the matter as soon as the court case is over.

A close source to SEC said: "The parties involved in the Cadbury Nigeria Plc alleged misrepresentation of financials were billed to appear before APC some weeks ago, but some of them came with court injunction that they should not be tried. This was the second court injunction."

The Commission had recently alleged that Cadbury Nigeria Plc was frustrating its efforts to investigate the alleged inflation of financial statement reported in the company's accounts last year.

Cadbury, however, denied this and said it was cooperating fully with the regulator. "We are cooperating with SEC," the spokesman for Cadbury, Mr. Kufre Ekanem, said in a telephone interview with Vanguard.

The alleged inflation on the financial statement in the accounts of Cadbury Nigeria was discovered last year after the company appointed an independent investigator, PriceWaterhouseCoopers, to probe its accounts.

SEC, which regulates the activities of all quoted companies, said it constituted an Administrative Proceeding Committee (APC) to conduct a thorough investigation into the matter, but said Cadbury was blocking the investigations.

The Head Legal Services of the Commission, Mr. Edosa k. Aigbekaen, said when the panel was to hear the position of the company, Cadbury Nigeria brought an order from the Federal High Court and stopped the proceedings.

Aigbekaen who spoke at a workshop for capital market reporters in Lagos recently said as a law-abiding corporate citizen, SEC stayed proceedings on that day and went to the court to vacate the order.

"We were able to vacate that order and we fixed new dates for the hearing, which were July 23 and 24. Again, we were slammed with another injunction from the company," he said.

He said with the information available to the Commission, it would have held its sitting and taken a decision.

According to him, "SEC decided to go a step further by bringing in all stakeholders to a very transparent atmosphere that was clear to everybody.

But the issue is being prevented by the same company we are trying to assist to bring out the truth."

Cadbury, however, declined to comment on the court injunction. "The matter is in court. We can't comment," Ekanem said.

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