REGULATORY FAILURES AND THE COLLAPSE OF THE CAPITAL MARKET IN NIGERIA: ALIGNING RESPONSIBILITIES WITH ACCOUNTABILTY

Abstract

Despite the damaging impacts of the crash in the Nigerian capital markets between 2007 and 2011 on the economy and the established cases of regulatory failures in the industry, the question of regulatory accountability has not received much attention in Nigeria. Looking back at these regulatory failures vis-à-vis the statutory responsibilities of the regulators of the capital markets in Nigeria and comparing same with the securities regulatory authority of the UK under the FSMA, 2000 this article argued that responsibilities should go with accountability for an effective capital market regulation in Nigeria. The article found that the apex regulator in Nigeria lacks the necessary operational independence. It questioned the increasing trend of regulatory laxity and ‘highhandedness’ in the capital market. The article recommended a proper regulatory accountability through a review of administrative decisions, actions in torts on the grounds of regulatory negligence, breach of statutory duty and misfeasance in public office. It also recommended a total restructuring of the apex regulator to make it more operationally independent in line with global best practices.