Namibia Reels from Identity Theft-Fueled Financial Losses: Stock Exchange Assures Shareholders’ Interests are Safe

The Namibia Stock Exchange (NSX) has moved to reassure shareholders that they will not suffer any losses following a recent fraudulent transfer of shares worth N$9 million belonging to clients of stockbroking firm Simonis Storm Securities. The theft, which is believed to be an instance of identity theft, was orchestrated by a former employee of the company.

Fraudulent Transfer and Investigation

According to NSX Chief Executive Officer Tiaan Bazuin, the case is still under investigation and no shareholder will suffer any loss as a result of the fraud. He pointed out that there are guarantee funds in place to protect shareholders from potential losses due to market irregularities.

Need for Advanced Verification Systems

The recent incident has highlighted the need for advanced verification systems to prevent such cases of identity theft. Bazuin emphasized the importance of biometric systems that can query a central database, such as the Internal Affairs database, to verify the identities of clients.

Central Securities Depository (CSD) - A Key Solution

The case also underscores the critical importance of a central securities depository (CSD), an electronic registry of shares linked to bank payment systems. A CSD would eliminate the risks of funds being diverted and ensure smooth settlements by ensuring simultaneous delivery of securities and payment.

Implementation of CSD

Earlier this year, the Namibia Financial Institutions Supervisory Authority (Namfisa) issued a CSD license, marking a key step towards greater market security. The implementation of the CSD is now a priority, with its officials emphasizing that it will foster the growth of the capital market industry in Namibia, which is valued at N$251 billion.

Benefits of CSD

The CSD will facilitate seamless digital transactions and replace paper securities with secure digital records, strengthening the overall stability of Namibia’s financial system. According to Namfisa spokesperson Victoria Raimond, the CSD is set to catalyze innovation while safeguarding both buyers and sellers.

Legal Action Against Former Employee

Meanwhile, Simonis Storm Securities has opened a criminal case against former employee Liaan de Kock for fraudulently selling client shares worth $9 million. De Kock allegedly transferred shares to one client without approval and sold shares from another client’s account without his knowledge. The company is also taking legal action against de Kock, his wife, and Connie van Tonder, who is suspected of receiving payments from Van Tonder’s account.

Growing Concern Over Identity Theft

The recent incident highlights the growing concern over identity theft in Namibia, with experts warning that advanced verification systems are needed to prevent such cases. As the country continues to grapple with the issue, investors are urging for greater security measures to be put in place to protect their investments.

Conclusion

In conclusion, the recent identity theft incident has highlighted the need for enhanced security measures and advanced verification systems to prevent similar incidents from occurring in the future. The implementation of a CSD is a crucial step towards achieving this goal, and investors are urging for greater action to be taken to protect their interests.