SECP takes action against illegal business of two firms
The Securities and Exchange Commission of Pakistan (SECP) has clarified that the mere registration of a company with SECP does not authorize acceptance of deposits from the general public.
Deposit-taking by companies other than banking companies is illegal in terms of section 84 of the Act. Only special companies can offer financial services including car financing, leasing, acceptance of deposits, house financing, etc. holding a valid license and regulatory approvals.
The SECP has advised the general public in their own interest to be careful, not to deal and invest in illegal schemes such companies offer.
In this regard, the SECP while exercising its regulatory power to curb the menace of illegal business practices in the country has taken stern actions against “Lasani Oil Traders (Private) Limited” and “New Lassani Chicks & Chicken (Private) Limited”. 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.
SECP has observed that both the companies are using their registration with SECP and FBR to win public confidence and publicize unauthorized investment schemes through Facebook groups and posts on social media.
In an attempt to block companies’ access to the general public, SECP approached PTA to block Facebook/Twitter pages, cell phone numbers registered in the name of companies and their directors. The SECP has also made reference to the case to the relevant law enforcement agency.
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