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SECP Takes Actions Against Non-compliant Market Participants

The Securities and Exchange Commission of Pakistan (SECP) has endeavored to continue its efforts for the development of a transparent and efficient stock market by ensuring investors’ protection and strengthening the enforcement procedures.

“Adopting an aggressive approach for the prevalence of a fair market, the Securities Market Division (SMD) has been practicing vigilant supervision and stringent oversight of the securities market”, says a statement issued by the Commission here today.

In this regard, during the month of April 2013, the SMD have issued 10 Orders, 34 Show Cause Notices, and 12 Warning Letters to various companies, and individuals for contravening the various provisions of the Securities and Corporate Laws.

Order was passed against the Chief Executive Officer of CYAN Ltd, who was also a director in Dawood Hercules Corporation Ltd, an associated listed concern, for indulging in a scheme of insider trading, and a penalty of Rs. 1 million was imposed.

Further, in the same context, an order was passed against CYAN Ltd for insider trading in the scrip of Dawood Hercules, and a penalty of Rs. 2 million was imposed; moreover, an order was issued against CYAN Ltd for trading in the shares of its associated concern in the closed period.

Based on the findings of on-site inspection of the Karachi Stock Exchange (KSE) Brokers conducted by SECP, orders were issued against Axis Global Ltd, Al-Hoqani Securities, Shajar Capital Ltd, First Equity Modaraba, Muniff Ziauddin Junaidy & Co, Nasir Javaid Maqsood Imran Ashfaq Chartered Accountants and Riaz Ahmad Saqib Gohar & Company Chartered Accountants.

During the month of April 2013, five Show Cause Notices have been served for insider trading to various entities and individuals; moreover, three Show Cause Notices have been issued to listed companies for violation of the Listing Regulations; a further six Show Cause Notices were issued to KSE, Brokers and their Auditors for violation of the Securities and Exchange Ordinance, 1969.

In addition, sixteen Show Cause Notices were issued to Directors and Beneficial Owners of listed companies for late filing of the returns of beneficial ownership, and four Show Cause Notices were issued to Beneficial Owners and Issuers of the listed securities for recovery of the tenderable gain under Section 224 of the Companies Ordinance, 1984.

In the month of April 2013, Warning Letters were issued to Ashfaq Textile Mills, KSB Pumps Company, and Prudential Capital Management for not abiding by the Listing Regulations of the KSE; moreover, nine Warning Letters were issued to the Beneficial Owners of Bank of Khyber, Murree Brewery Ltd and Pak Gum & Chemical Ltd for late filing of returns of beneficial ownership.

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