Manipulation of stock prices: SECP files criminal cases against individuals

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has filed four criminal complaints against Lahore-based individuals involved in manipulating stock prices, including sponsors and brokerage house management.

The Banking Offence Court Lahore has admitted all four complaints filed by SECP against the accused individuals.

Sources told Business Recorder that the accused individuals belonged to Lahore and their registered office addresses were also of Lahore.

The accused gained significant profits by manipulating the share prices of three listed companies in 2019, 2020, and 2021. The SECP reached these conclusions after completing thorough investigations under the Securities Act of 2015.

The investigations established that these individuals placed high-priced orders and traded with one another to artificially raise the share prices of specific stocks. They also placed fake buy orders and then cancelled a large number of these transactions, resulting in fictitious quotations to deceive potential investors.

The accused also fraudulently misused clients’ accounts to place large orders, aiming at attracting the public by creating a false sense of demand for the shares.

In terms of the Securities Act, 2015, market manipulation, being a criminal offence, may lead to imprisonment up to three years and a fine up to Rs 200 million.

The SECP is committed to taking effective supervision and enforcement actions to ensure the integrity of the capital market and protect investors from malpractice.

Copyright Business Recorder, 2024