SECP files criminal complaints against four stock price manipulators

ISLAMABAD: The securities regulator said on Wednesday it had filed criminal complaints against four individuals, including sponsors and brokers, for manipulating stock prices in the country's main bourse.

The Securities and Exchange Commission of Pakistan (SECP) did not name the accused, saying "publicising their names might tarnish their reputation".

The move followed years of alleged inaction by the SECP, which was accused of ignoring market manipulation in the Pakistan Stock Exchange (PSX) involving "wash trading" and "pump and dump" schemes by individuals, including sponsors and brokerage house management, for a span of two to five years.

The SECP confirmed in a statement the filing of four criminal complaints against individuals involved in stock price manipulation, including sponsors and brokerage house management. The courts have accepted all four complaints.

Sources told The News that due to the Lahore-based nature of the brokerage house and individuals involved, the cases related to the four criminal complaints have been lodged in the Special Court (Offences in Banks-I), Lahore. Presently, these complaints await adjudication in the Special Court. Bailable warrants for the accused in all four criminal complaints were issued on Wednesday.

The regulator said the accused had made huge profits by artificially inflating the share prices of three listed companies between 2019 and 2021, using techniques such as placing fake orders, placing inflated orders, trading among themselves, and abusing clients' accounts.

Under the Securities Act of 2015, market manipulation constitutes a criminal offense, punishable by imprisonment for up to three years and fines of up to Rs200 million. The SECP chairman, Akif Saeed, did not respond to phone calls and text messages from The News, seeking the names of the accused.