The Securities and Exchange Commission of Pakistan (SECP) is escalating investigations against stockbrokers in a campaign to curb insider trading and illegal leveraging in the stock market, its executive director said in an interview.
SECP has filed criminal complaints of market abuses against seven stockbrokers this year, including for insider trading and stocks manipulation. A judge will decide whether the complaints warrant formal charges – the usual outcome in such cases.
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Two complaints have also been filed about employees in banks who engaged in “front-running”, which involves trading on advance information not available to clients.
SECP executive director Bilal Rasul told Reuters in an interview that the agency has taken a more assertive role this year in the wake of new legislation to reform financial markets.
“In terms of investigations, legal proceedings, regulations passed, I think the broker community and the market have reconciled with the fact that they need to ensure full compliance in order to stay in business,” Rasul, also the SECP’s spokesman, said at its headquarters in Islamabad.