Teaching Comparative Government and Politics

Monday, July 05, 2010

Reform in a "patronage-intensive" society

Eliminating corruption in Nigeria often seems to require reforms everywhere. Here's one example.

Nigeria's iron lady takes on fraudsters

Arunma Oteh, the woman tasked with the unenviable job of policing Nigeria's financial world, has a warm smile and a piercing stare…

Ms Oteh, [right] Nigeria's Securities and Exchange Commission boss, took up the post in January, bringing with her a tough surveillance and enforcement regime…

Last year, as major banks veered close to collapse, the government was forced into a $4bn (£2.67bn) bailout of nine lenders.

The central bank governor carried out a forensic cull - the so-called "Friday massacre" - sacking management teams at eight banks.

As the stock market fell, it became apparent some stockbrokers were involved in the scandal - collaborating in abuses ranging from insider share dealing to market manipulation and share price fixing.

Now Ms Oteh wants illegally gained profits made on the stock market to be "disgorged".

"We will restitute [restore lost money to] investors," she says…

And repairing the damage is not easy.

Insiders in the financial world describe an ugly fight-back aimed at Ms Oteh and her plans for tougher oversight and more transparency.

"Oteh faces severe resistance," said one economist, asking not to be named.

"It's coming from very influential, powerful individuals. It is a patronage-intensive society, and their influence extends well into government."…

But she says she will not give up.

"What gives me comfort is that the President, Goodluck Jonathan, is behind us. It's what he believes in.

"That makes me even more determined."