The Independent Shareholders Association of Nigeria (ISAN) has again raised alarm over the Federal Government’s decision to centralise unclaimed dividends under the custody of the Central Bank of Nigeria (CBN), describing the move as a constitutional breach, an indirect asset seizure, and a serious threat to investor confidence in Nigeria’s capital market.
This was contained in a formal letter signed by ISAN’s National Coordinator, Moses Igbrude, and addressed to key policymakers, warning that the recently passed legislation mandating the transfer of all unclaimed dividends from registrars to the CBN constitutes an “unjust inversion into private property.”
The development revives concerns first voiced in 2020 when the Federal Government revealed its intention to transfer over ₦215 billion worth of unclaimed dividends to a trust fund managed by the Debt Management Office (DMO) and the Securities and Exchange Commission (SEC). Shareholders, economists, and capital market experts at the time decried the policy as a veiled expropriation of funds legally belonging to private individuals.
The Companies and Allied Matters Act (CAMA) had previously provided a 12-year statutory window within which shareholders could claim dividends, after which such funds were to be reverted to the declaring company as retained earnings for reinvestment. However, the new law overrides this provision, mandating that registrars transfer all unclaimed dividends to the CBN regardless of the duration of dormancy.
ISAN insists this new arrangement contradicts the principles of fair market practice, transparency, and stakeholder engagement, which form the foundation of investor trust. “These dividends are not abandoned government revenue,” Igbrude argued. “They are earnings—rightful returns on investments—due to shareholders and their legal heirs. The government has no legal or moral right to seize them under any pretext.”
The association described the legislation as unconstitutional and ethically flawed, equating it to an indirect form of wealth confiscation. It stated that, even if well-intentioned, centralising dividend custody under a state-run agency like the CBN creates a risk of mismanagement and undermines private wealth protections guaranteed by law.
Further intensifying its stance, ISAN criticised the lack of public consultation during the policy formulation process. “It is deeply troubling that the shareholders—owners of the funds—along with registrars and market regulators, were not adequately consulted. Decisions of such magnitude should never be made in isolation,” the letter added.
The association also cited Nigeria’s poor track record in managing public assets as a major reason for its opposition. “History is littered with examples of misappropriated government-controlled funds,” Igbrude said, expressing fears that the unclaimed dividends, once in public custody, may not be effectively safeguarded or returned to rightful owners.
Financial analysts have warned that the move may dampen investor morale and further discourage foreign portfolio investment in an already fragile economic environment. “The lack of clarity on the mechanism for reclaiming such dividends once they’re under CBN control is worrying,” said Chuka Ibeh, a Lagos-based financial analyst.
He added that this development could lead to more investors opting for offshore accounts or non-dividend paying securities to avoid regulatory interference.
ISAN called for an urgent stakeholder dialogue to revisit the legislation and explore sustainable alternatives that do not infringe on shareholder rights. The group is also urging the National Assembly and the Presidency to repeal the policy and uphold the sanctity of private property in a free-market economy.
“The government should focus on facilitating digital platforms for dividend claims, improving identity management, and supporting registrars’ efforts to locate beneficiaries—rather than seizing the funds outright,” Igbrude concluded.
As Nigeria’s capital market seeks to position itself as a credible investment destination, experts say policy consistency, stakeholder engagement, and investor protection will be key pillars for long-term stability and growth. The backlash over unclaimed dividends may yet prove a litmus test for the Tinubu administration’s economic reform credibility.