Brokerage houses penalised

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) during the second quarter (Oct-Dec 2014/15) took enforcement actions against market players for non-compliance with the regulatory framework, a statement said on Wednesday.
Pursuant to the on-site inspections of the brokerage houses of the Karachi Stock Exchange (KSE), the Securities Market Division of the SECP initiated enforcement actions against a number of brokers.
It imposed penalties on Global Securities Pakistan Limited, Invest and Finance Securities Limited, Seven Star Securities (Private) Limited and Alfa Adhi Securities (Private) Limited on account of failure to maintain proper segregation of clients’ assets; improper books of accounts; failure to have proper Know Your Customer and Customer Due Diligence Policy in place, and imposing late payment charges to their clients.
An order against WE Financial Services Limited was issued with the warning to strictly maintain segregation of clients’ assets.
Warnings were also issued to MH Securities (Private) Limited and Cedar Capital (Private) limited for non-compliances identified as a result of inspection.
Additionally the brokers were required to provide additional information on cut-off dates to substantiate their claims of maintaining segregation of clients’ assets.
An order was also issued for the recovery of tenderable gain to the director of a listed company, and 13 orders penalising director / beneficial owner of four listed companies- under section 224(4) of the 1984 Companies Ordinance for late filing of returns of beneficial ownership- were issued.