SECP Files Criminal Cases against Brokers over Stock Price Manipulation

By Newztodays Team

The Securities and Exchange Commission of Pakistan (SECP) has uncovered fraudulent activities aimed at inflating stock market share prices.

As a result, the SECP has initiated legal action by filing four criminal complaints against individuals involved in this manipulation, including sponsors and brokerage house management.

Although the SECP has chosen not to disclose the names of the brokers involved, it has filed complaints at the Banking Offence Court Lahore against the accused individuals, and these complaints have been admitted.KSE 100 Index Surges by 747 Points, Closing at 65,326 Level

The investigations conducted by the SECP’s Supervision Department revealed that the accused individuals profited significantly by artificially inflating the share prices of three listed companies between 2019 and 2021.

They achieved this by executing high-priced orders and engaging in trades amongst themselves to create an illusion of increasing demand and raising stock prices.

The fraudulent activities also included placing fake buy orders and subsequently canceling a large portion of these transactions to manipulate quotations and deceive potential investors.

Additionally, the accused individuals exploited clients’ accounts to place large orders, further contributing to the false perception of demand for the shares.

Under the Securities Act of 2015, market manipulation is considered a criminal offense punishable by imprisonment for up to three years and a fine of up to Rs200 million.

The SECP has reiterated its commitment to maintaining the integrity of the capital market and safeguarding investors from such malpractice.

It has pledged to continue taking rigorous supervision and enforcement measures to uphold market integrity and protect investors’ interests.