Section 63 Investments and Securities Act 2025

Section 63 of the Investments and Securities Act 2025 is about Accounts to be kept by capital market operator. It is under Part VI (Registration and Regulation of Capital Market Operators) of the Act. It provides as follows:

(1) A capital market operator shall keep or cause to be kept such accounting and other records —
(a) as shall sufficiently show and explain the transactions and financial position of his business and enable true and fair profit and loss accounts and balance sheets to be prepared, regularly; and
(b) in a manner that shall enable them to be conveniently and properly audited.

(2) A capital market operator shall be deemed not to have complied with subsection (1) in relation to records unless the accounting and other records of the capital market operator —

(a) are kept in sufficient detail to show particulars of all —
(i) money received or paid by the capital market operator, including money paid to or disbursed from a trust account,
(ii) purchases and sales of securities made by the capital market operator, the charges and credits arising from them, and the names of the buyers and sellers, respectively of each of those securities,
(iii) income received from commissions, interest, and other sources, and all expenses, commissions, and interest paid by the capital market operator,
(iv) the assets and liabilities, including contingent liabilities, of the capital market operator,

(v) securities which are the property of the capital market operator showing by whom the securities or the documents of title to the securities are held and, where they are held by some other person, whether or not they are held as securities against loans or advances,
(vi) securities that are not the property of the capital market operator and for which the dealer or any nominee controlled by the security dealer is accountable, showing by whom, and for whom, the securities or the documents of title to the securities are held and the extent to which they are either held for safe custody or deposited with a third party as securities for loans or advances made to the capital market operator,

(vii) purchases and sales of options made by the capital market operator and all fees (being options money) arising from them,
(viii) arbitrage transactions entered into by the capital market operator, and
(ix) underwriting transactions entered into by the capital market operator;

(b) are kept in sufficient detail to show particulars of every transaction by the capital market operator;

(c) specify the day on which or the period during which each transaction by the capital market operator took place; and

(d) contain copies of acknowledgements of the receipt of securities or of documents of title to securities received by the capital market operator from clients for sale or safe custody clearly showing the name in which the particular securities are registered.

(3) Without prejudice to subsection (2), a capital market operator shall keep records in sufficient detail to show particulars of all transactions by the capital market operator with or for the account of —
(a) clients of the capital market operator;
(b) the capital market operator himself; and
(c) employees of the capital market operator.

(4) A director or an officer of a capital market operator who contravenes or fails to comply with any of the provisions of this section, commits an offence and is liable on conviction to a fine of not less than N2,000,000 or imprisonment for a term of not less than one year.

(5) The Commission may, in lieu of prosecution for the offence prescribed in subsection (4), sanction a director or an officer of a capital market operator who violates the provisions of this section by imposing an administrative fine of not less than N2,000,000 and a further sum of not less than N5,000 for every day in which the violation continues.