The regulatory order placed on Goldlink Insurance Plc and International Energy Insurance (IEI) and others by the National Insurance Commission (NAICOM) is yielding results.
The commission has booted out some directors from the companies.
Similarly, the Commission claimed that a particular chairman returned N66 million cash looted from a risk bearing firm.
Commissioner for Insurance, Mohammed Kari who spoke with reporters in Gombe, Gombe State, said parties that engaged in corrupt practices would be reported to anti-graft agencies for prosecution.
He said shareholders who looted shares without paying for them had been dragged to the Economic and Financial Crimes Commission (EFCC).
He alleged that at Goldlink Insurance, some shareholders acquired claims without paying, adding that genuine shareholders of the companies have been identified.
He said: “There are two types of interventions. These are direct intervention and regulatory orders; the regulatory order of these companies is based on restrictions on their spending limit. We don’t involve ourselves in managing the companies. We ensure that they refer whatever they are spending to the commission for approval.
“In most cases, the technical issues like claims, reinsurance are not part of the issues they refer to us for approval and so technical order should not be a reason why any company will say our intervention is a problem to their operations. In the first place, a company falls under regulatory order because it is found to have violated significant issues of the regulation. Most of them have internal squabbles like corporate governance, financial or solvency margin issues and inability to pay claims.
“Some of the companies are under direct order where the commissioner set up an interim management to look into the problems of the company. There was an internal squabble within IEI and the board of directors resigned from the board because of this problem. We set up an interim management which was empowered to conduct a forensic review and investigation into these companies.
“The forensic review has done so many things that normal return inspection will not be able to identify. In the process of investigation, we also found that some of the shareholders of these companies were just shareholders by name. In the case of Goldlink, most of the shareholders acquired claims without paying for them. “Our position is that if you acquire share without paying for them, you must relinquish the shares voluntarily. So, if we did not do a share audit, we would not be able to determine the real shareholders. You will not be able to know that most of these so-called directors are just sitting there as majority shareholder and they are not paying for them.
“We have collaborated with other regulatory bodies like Securities and Exchange Commission (SEC) because most of these issues are corporate governance issues, relating to the ownership of these companies.
“We relate with them to have meetings and engagement to find a way to cover for the unpaid shares where it is possible and also refer some of these cases to relevant law enforcement agencies to ensure that the issues are properly addressed.”
On whether or not the Commission will bail out the embattled companies like it was done with banks by the Asset Management Company of Nigeria (AMCON) and the Central Bank of Nigeria (CBN), the Commissioner said NAICOM cannot bail companies out under insurance arrangement.
“Our law does not empower us to do that. Even the bailout, we always look at how we make these companies to bail themselves out because before you talk about bailout, the company must be able to bail itself out. In doing that, all the process of recovery of stolen funds must be returned. We have seen the problem of bailout where AMCON is trying to recover all these monies. Nigerian economy should not be used to fund financial recklessness of some people,” he added.