SECP files criminal complaint against two individuals


ISLAMABAD  -  Based on an investigation conducted under the Securities Act, 2015, the SECP has filed a criminal complaint against two individuals who were found involved in front-running eq­uity trading by a large institutional investor during the period from Oc­tober 1, 2021, to December 31, 2021.

The criminal complaint number 15 of 2024, dated April 8, 2024, has been filed at the Special Court (Offenses in Banks), Karachi. The analysis of order-level data by SECP investiga­tion team revealed that a day trader, with the active connivance of an in­vestment officer of the institutional investor, purchased shares before the placement of buy orders by the insti­tutional investor and subsequently sold those shares to the institutional investor. The practice continued for a few months. A substantial portion of the trades executed by the day trad­er during this period matched with trades executed by institutional inves­tor as a counterparty. This resulted in losses to the institutional investor and gains to the day trader. There is strong evidence that the investment officer of the institutional investor was actively colluding with the day trader. SECP is committed to ensure fairness and transparency in the capital market to enhance investors’ confidence.

Meanwhile, the Securities and Exchange Commission of Pakistan (SECP) has registered M/s Salaam Family Takaful Limited as the first ever digital family takaful operator. The registration regime for digital-only in­surers and dedicated micro-insurers was introduced through an amend­ment to the Insurance Rules, 2017, no­tified vide S.R.O 1513(I)/2022, aiming to promote digitalization and improve customer convenience through instant provision of services. The licensing of digital insurers in Pakistan will im­prove competition in the insurance market by lowering entrance barriers and providing more access to new in­surance products and services. Digital insurers are expected to significantly lower policyholder costs and promote the adoption of customer-cantered international best practices. Digital insurers will offer digitized claims management, enhanced policyholder connectivity through portal-based communication, and tailored services to meet policyholders’ specific needs.

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