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Nigeria’s Securities Commission Aims to Curb the Growing Number of Online Brokers

Nigeria is taking another stab at trying to cool off demand for foreign stocks with tighter regulatory oversight of local brokers. The Abuja-based Securities and Exchange Commission now plans to register brokers selling stocks of foreign companies as more Nigerians pile into the assets to hedge against inflation and currency weakness. An earlier effort last month met local resistance, backfiring after warnings alerting people to risks and threats to sanction local traders. The regulator wants to draw a curtain on a period that saw legions of young Nigerians turn to online platforms to invest in stocks and digital currencies. The need to protect savings took on more urgency after the central bank devalued the local currency three times within a year while inflation accelerated at the fastest pace in four years. Before now, the online platforms could connect high net-worth individuals without an independent license. The SEC now wants to regulate them directly over concerns they’re targeting retail investors that require protection. The All-Share Index, Nigeria’s benchmark equity gauge rose 0.2% to 39,198.75 at close of trading in Lagos on Friday. That pared its retreat this year to 2.6%, compared with a gain of 12% in the S&P 500 Index.