Curbing Corporate And Organisational Deception In Nigeria
“There are some frauds so well conducted that it would be stupidity not to deceived by them”----Charles Colton
In 2009, an American billionaire, stock broker, financial adviser and former Chairman of NASDAQ, Bernard Madoff was sentenced to 150 years imprisonment and the payment of $17 billion as restitution to his clientele. Before his conviction and sentencing, Mr. Madoff was accused of running a ponzi scheme! A ponzi scheme according to Investopedia.com is a fraudulent investing scam promising high rates of return with little risk to investors.
This was what Mr. Madoff was doing with his firm, “Bernard L. Madoff Investment Securities LLC”. A company he floated in 1960. When luck ran out of him, he was investigated by the Federal Bureau of Investigation (FBI) and subsequently charged for committing securities fraud, mail fraud, wire fraud, making false fillings with the Securities and Exchanges Commission (SEC), investing advisor fraud, perjury among others. As of 2008, his firm had a liability of about $50 billion, while the monetary value of his fraud was approximately $65 billion with about 4,800 clientele.
Before the audit of our banks in 2009, we experienced situations where banks were declaring huge financial profits without a corresponding growth in the real sector. Some of our banks instead of making relevant information available to the public, they will only release financial statements where they tell people that a particular bank makes X amount of money as profit after tax and Y amount of money as profit before tax, but when you ask some of their shareholders how much they got as dividends, they can't say anything! Some of these banks where on the verge of becoming market makers on our stock exchange market, but, the banking audit of 2009 shows that, some of these banks were buying up their own stocks so as create artificial scarcity in the market.
When this scarcity exists, investors will think that such company is doing well and will invest their money in them! During that episode, some financial analysts became gamblers. At various seminars and workshops which they organize, instead of telling people the facts and fictions of stock market and the long term nature of the market, some of them adopted ambush-marketing strategy to lure in people in to a business they knew little or nothing about. They emphasize only on the short term aspect of the market which is “capital appreciation”.
Ordinarily, a typical Nigerian don't read newspapers on regular basis, they only buy and read papers when there is a dangerous plane crash, cabinet reshuffle or popular appointments among others, but, during the era of a booming stock market, many Nigerians became newspaper readers and analysts. Then, if you see any civil servant or a young man with a newspaper, you will be thinking he wants to read a particular story or the OPED page, but as soon as he picks a newspaper, the first page he would go to is the financial page where most newspapers publish stock market reports. Sometimes, they don't even read the front page headlines let alone searching for interesting stories!
Similarly, some of the network service providers use their unsolicited text messages to bully their customers with advert contents. Sometimes, I begin to wonder what type of business model they are really practicing. The business models of Yahoo, Google, and Facebook etc are clear! They allow us to create free accounts while they benefit from the adverts they place in our inbox. But, the case of these service providers is quite different!
They sell sim cards to us, we pay money to recharge our accounts, the next we are entitled to, is to allow us to own the sole rights of our Sim Cards by determining what type of advert contents we get. But, nothing of such is in existence.
After they charge us to be on their networks, they still advertise freely on what is supposed to be ours, even without our consents. While the internet business model is win-win, that of our service providers is zero-sum. Most times, their advert contents are deceptive. The question is how many regulatory bodies are regulating these networks providers? Can't we share parts of their advert proceeds? Where is or what is the Advertising Practitioners Council of Nigeria (APCON) doing about this scenario?
Like I have highlighted earlier, there have been complains of banks not disclosing the full details of their terms to customers before providing them with complex loans. This was the case the Philadelphia Consumer Class Action Attorneys frown at when it wrote: “Consumers should be able to expect that banks, credit card companies and other financial service entities with which they do business treat them fairly and in accordance with Federal and State regulations. But financial institutions often attempt to increase their revenue at the expense of consumers by employing deceptive and unfair practices”.
Finally, every relevant government agencies including the Consumer Protection Council (CPC) should try and secure more convictions or impose huge fines so as to serve as deterrent to others. Nigerians are tired of deceits disguising as truths!
*Comrade Edwin Ekene Uhara is an activist and public affairs commentator. He is also the National President of Young Nigerians for Change.
No.29, Ben Mbamalu Crescent, Achara Layout, Enugu State.