Policy Board directs SECP to reduce financial services fees

ISLAMABAD: On the recommendation of its Regulations Committee, the Policy Board of the Securities and Exchange Commission of Pakistan (SECP) has directed the commission to consider a substantial reduction in fees to remove the harsh regulatory impediments that hamper the overall growth of the financial services market and to facilitate the ease of doing business in the country, a statement said on Wednesday.

Professor Khalid Mirza, chairman of the board, said: “We must move towards beneficial regulation of the financial services. It is important to simplify and reduce the cost of doing business.”

“What we are seeking is light regulation, low cost and tough, as well as fair enforcement,” he said.

Pakistan Stock Exchange (PSX) chairman also gave a presentation to the Policy Board on the regulatory and policy issues confronting the stock market intermediaries and other operators in the market.

The board agreed, in principle, to all the measures proposed by the PSX, including ceasing the practice of annual renewal of licence; reduction of 8bps fee on every rupee under the management of mutual funds, which costs funds around Rs450 million/year, to 2bps; as well as other measures that would facilitate operations of the financial industry.

In this regard, the board gave directives to the commission.

In addition to other decisions, the Policy Board also constituted an insurance committee to delve into the issues and challenges that are being posed to the industry.

In the previous meeting of the board, the oversight, regulation and governance committees were constituted, which also presented recommendations / suggestions of their respective areas.

The SECP Policy Board, in pursuance of Section 12 of the SECP Act 1997, comprises ex officio members of the ministries of finance, commerce, and law, SBP, SECP and persons of eminence from the private sector.

Meanwhile, SECP in a separate statement warned public and asked not to invest in Ponzi schemes of a dubious company named ‘Reliable Estate’,

“It has come to the knowledge of the SECP that in the name of Reliable Estate an anonymous person is engaged in unauthorized and dubious activities,” the commission said. “He is trying to collect deposits from the public by offering various Ponzi schemes. On his website a fake company registration certificate purportedly issued by the SECP entitled “Reliable Estate (Pvt.) Limited has been displayed.”

The SECP said ‘Reliable Estate’ is not registered with the commission and that “raising unauthorized deposits from the public, indulging in referral marketing, multi-level marketing (MLM), pyramid and Ponzi schemes, directly or indirectly are unlawful/unauthorized business activities”.

The commission warned the public not to be misled by such fraudulent activities and marketing schemes launched by the entities/companies through advertising in the electronic and print media, websites, emails and mobile text messages.