SECP files criminal case against group

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has filed a criminal complaint in the Sessions Court Karachi against a group comprising two brothers, their cousin and their facilitator broker, Adam Securities Limited, for manipulating in the book building activity of Al Shaheer Corporation Limited, which was listed in 2015, a statement said on Wednesday.

The chief executive, of the said broker, also happens to be the father of the two brothers, it added. Based on an investigation, the Securities and Exchange Commission of Pakistan found that the group was indulged in market manipulation during book building process and; thus, had the influence to manipulate the strike price of an issue.

The last 12 minutes bidding activity of the group indicated that the intent was to ramp the strike price of issue rather than bidding at a fair price, the statement said.

The group increased / decreased its bidding volumes in a manipulative fashion, while keeping its bid price constant, so as to manipulate the strike price discovery process and induce other bidders to take part in the bidding activity aggressively.

Market manipulation is a criminal offence and is defined in Section 133 of the Securities Act, 2015. It is one of its kind complaints filed by the SECP, wherein a group has been alleged to have indulged in manipulation during book building process, which depicts the Securities and Exchange Commission of Pakistan’s resolve for indiscriminate action against all kinds of market abusers.