FEDERAL HIGH COURT CONVICTS THREE COMPANIES FOR ILLEGAL CAPITAL MARKET OPERATIONS
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By Aishat Momoh. O.
Justice D.I. Dipeolu of the Federal High Court in Ikoyi, Lagos, on Monday convicted three companies FARM360 Limited, MCBHADMOS Trans-Atlantic Trade Limited, and Quintessential Investment Company Limited for engaging in illegal capital market operations without appropriate regulatory licences.
The Economic and Financial Crimes Commission (EFCC), in a statement, said that FARM360 and MCBHADMOS were arraigned on June 16 by its Lagos Zonal Directorate 2 on a five-count charge bordering on operating unlicensed collective investment schemes. The companies reportedly collected N80 million from investors between 2021 and 2022 under false pretenses of engaging in agricultural and forex trading ventures, promising high returns.
One of the charges read: “That you, FARM360 LIMITED and MCBHADMOS TRANS-ATLANTIC TRADE LIMITED… failed to obtain a valid licence from the Central Bank of Nigeria to carry on your business of Investment management and you thereby committed an offence contrary to Section 57 of the Banks and Other Financial Institutions Act 2020.”
Despite a “not guilty” plea entered on behalf of the companies, EFCC prosecutor Abdulhamid Tukur presented overwhelming evidence, including bank statements, petitions from defrauded investors, and correspondence from the Central Bank of Nigeria (CBN), Securities and Exchange Commission (SEC), and the Corporate Affairs Commission (CAC), all confirming the companies were not licensed to operate investment or forex services in Nigeria.
EFCC investigator Nnadikwu Izuchukwu Collins revealed that N93 million was invested by the complainants, with N80 million traced to personal use by the directors, who are currently at large.
Justice Dipeolu convicted both companies on all five counts and ordered them to pay a fine of N5 million on each count, totalling N25 million.
In a related judgment, the same court also convicted Quintessential Investment Company Limited on a two-count charge for similarly operating an unlicensed collective investment scheme. The EFCC said the firm had been fraudulently engaging investors without the necessary approvals from the CBN or SEC.
Efforts are ongoing to arrest the directors of all convicted companies.
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