The Board of Trustees (BoT) of the Investors’ Protection Fund (IPF) has approved an increase in the maximum compensation sum to investors who have suffered pecuniary losses from N400,000 to N500,000.
This is as it assured investors that it remains committed to enhancing investors’ protection in the Nigerian capital market (NCM), according to a statement.
The statement said, “IPF at its meeting of 18 November 2021 approved an increase in the maximum compensation sum to investors who have suffered pecuniary losses from Four Hundred Thousand Naira (N400,000.00) to Five hundred Thousand Naira (N500,000.00) only.
“The BoT reached this decision after due consultation, assessment of the limited resources of the IPF and the volume of claims pending against the IPF as well as the prevailing circumstances in the capital market in determining the increase in the maximum amount of compensation payable”.
According to the IPF, this is in accordance with Rule 26.16 (a) & (c): Amount of Compensation, Rulebook of The Exchange, 2015 (Investors’ Protection Fund Rules) as amended.
The rule provides thus: “The maximum compensation payable to an investor who has suffered a loss shall be an amount that is determined by the Board from a written policy from time to time; and where the loss is less than the maximum amount fixed by the Board at any given time, the investor may be paid the full amount of the loss, less any amount or value of all monies or other benefits received or receivable by him from a source other than the Fund in reduction of the loss.
“Notwithstanding the above, the amount of compensation may be reviewed by the Board on a biennial basis or as otherwise agreed by the Board as the need arises from time to time. In determining the maximum amount of compensation payable, the Board shall take into account circumstances prevailing in the capital market”.
IPF thereafter noted that the increase which took effect from 18 November 2021 does not apply to claims made to the IPF before the approval of the increase while adding that it remains committed to enhancing investor protection.