Regulatory Capture and Independent Agencies in Nigeria: Evidence from the Securities and Exchange Commission

Regulatory capture, whereby regulatory agencies come to advance the interests of the industries they regulate rather than the public interest, poses a fundamental challenge to the legitimacy and effectiveness of independent administrative bodies. Nigeria's Securities and Exchange Commission, established to protect investors and develop the capital market, has attracted empirical scrutiny regarding its capacity to maintain independence from the securities industry it regulates. This research empirically investigates the risk and manifestations of regulatory capture in the SEC, drawing on evidence from the period 2015 to 2024. A mixed-methods methodology was adopted, combining analysis of SEC enforcement action frequency and outcomes with structured interviews conducted with former SEC commissioners, capital market lawyers, and institutional investor representatives. Revolving-door employment patterns between the SEC and the securities industry were documented and analysed. Secondary sources include SEC annual reports, Administrative and Regulatory Law Review publications, comparative capital market regulation literature, and Nigerian corporate law scholarship. The study develops an original analytical model of regulatory capture risk factors calibrated to the Nigerian institutional context. Findings reveal patterns of enforcement lenience toward systemically significant market participants and documented revolving-door career movements that create potential capture vulnerabilities. The research recommends structural governance reforms including independent board oversight, post-employment cooling-off periods, and enhanced parliamentary scrutiny of SEC enforcement statistics. Keywords: regulatory capture, SEC Nigeria, capital market regulation, independent agencies, enforcement.