SECP takes action against fake investment firms

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has initiated legal proceedings against two firms unauthorised to operate investment schemes, it said on Wednesday.

SECP said both the companies are using their registration with SECP and Federal Board of Revenue (FBR) to win public confidence and are publicising unauthorised investment schemes through Facebook groups and posts on social media.

SECP also approached Pakistan Telecommunication Authority to get their Facebook/twitter pages and cell phone numbers registered in the name of companies and its directors blocked. The SECP made reference of the case to the relevant law enforcement agency.

The commission said it took ‘stern actions’ against these firms, namely Lasani Oil Traders (Private) Limited and “New Lassani Chicks and Chicken (Private) Limited. However, it didn’t disclose the quantum of financial scam.

“SECP has promptly initiated legal proceedings for the winding up of these companies in terms of section 301 read with section 304 of the Companies Act, 2017 and disqualification of directors thereof in terms of section 172 of the Act,” it said in a statement.

"Mere registration of a company with SECP does not authorise acceptance of deposits from general public. Deposit taking by companies other than banking companies is illegal in terms of section 84 of the Act. Financial services including car financing, leasing, acceptance of deposits, house financing etc. can only be offered by specialised companies holding valid licence and regulatory approvals."

The SECP advised the public to be careful, not to deal and invest in illegal schemes offered by such companies.

On its website, SECP has made public a list of 50 companies, involved in similar un-authorised business activities including illegally collecting deposits from investors by making false promises of exceptionally tantalizing returns.

Complaints or information against companies and entities involved in unauthorised deposit taking can be sent at email ID scams@secp.gov.pk.

SECP handled more than 1,100 complaints through the Pakistan Citizen Portal related to its regulatory domain during the last fiscal year. During the year, through the internal service desk management system), SECP has handled more than 6,500 complaints and more than 22,500 queries related to its regulatory domain.

SECP’s investor education department conducted 71 awareness sessions during the year for a diverse audience. SECP also welcomed universities from across the country to its head office to apprise the students about SECP and its regulatory domain. Using social media, relevant information and material was shared through the Jama Punji web portal, including Jamapunji Facebook and Twitter pages and 8181 SMS service.

Since the launch of Jamapunji portal in 2015, more than four million people have visited the Jamapunji portal till date to get education related to financial planning, investment basics, and protection from scams and frauds, to verify companies’ registration status etc.