Justice D.I. Dipeolu of the Federal High Court sitting in Ikoyi, Lagos, on Monday, convicted two companies, FARM360 Limited and MCBHADMOS Trans-Atlantic Trade Limited, for illegal capital market operations.
A statement by the Economic and Financial Crimes Commission (EFCC) said the companies were arraigned by the Lagos Zonal Directorate 2 of the EFCC, on June 16, on a five-count charge bordering on operating collective investment schemes without a licence either by the Central Bank of Nigeria (CBN), or the Securities and Exchange Commission (SEC).
It was alleged that both firms, between 2021 and 2022, collected the sum of N80 million from several investors, but defaulted in refunding them or paying back the interests accrued on their investments.
One of the counts reads: ”That you, FARM360 LIMITED and MCBHADMOS TRANS-ATLANTIC TRADE LIMITED, sometime between 2021 and 2022 in Nigeria, within the Judicial Division of this Honourable court, being companies incorporated in Nigeria, 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 and punishable under Sections 57(5) of the same Act.”
A “not guilty” plea was entered for the company. The prosecution counsel, Abdulhamid. Tukur, consequently, called on Nnadikwu Izuchukwu Collins, an investigator with the EFCC, to review the facts of the case.
Collins, in his review of the facts of the case, had stated that the EFCC, on October 21, 2022, received a petition from a group of investors against the defendants, FARM360 and MCBHADMOS RANS-ATLANTIC TRADE LIMITED, alleging that they claimed to be into agricultural business and forex trading, “with mouth-watering promises of returns on investments .”
He also told the court that the group invested a total sum of N93,000,000 with the defendants. He further stated that: “In the course of investigations, letters of investigation activities were sent to the Securities and Exchange Commission, banks, the Central Bank of Nigeria, and then the Corporate Affairs Commission, respectively.
“Responses were received from the above institutions and were analysed accordingly. The response from the SEC and CBN revealed that the defendants, FARM360 and MCBHADMOS RANS-ATLANTIC TRADE LIMITED, are not licensed to deal in investment and forex trading business in Nigeria.
“The response from Fidelity Bank showed that the sum of N80,000,000.00( Eighty Million Naira) got from the investors was utilised for personal use. The directors of the companies are all at large, and efforts are being made to apprehend them.”
The prosecution counsel had, therefore, tendered, in evidence, the bank statement from Fidelity Bank, the petition received by the EFCC from the group of investors, letters to the CAC, CBN and SEC and their responses.
Justice Dipeolu admitted and marked them as exhibits.
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At Monday’s sitting, Justice Dipeolu convicted the companies on all the counts and also ordered them to pay a fine of N5 million on each of the five counts.
In a related development, the judge also convicted another company, Quintessential Investment Company Limited, for illegal capital market operations, following its arraignment by the Lagos Zonal Directorate 2 of the EFCC on a two-count charge bordering on operating collective investment schemes without a licence by the CBN.
