Penalised: SECP takes action against rating firm
The company was earlier given an appropriate opportunity of hearing by the commission
ISLAMABAD:
The Securities and Exchange Commission of Pakistan (SECP) took on Monday enforcement action against a credit rating company involved in rating shopping and imposed the first-ever monetary penalty of Rs600,000. The company was earlier given an appropriate opportunity of hearing by the commission and was warned to comply with the regulatory framework and code of conduct in letter and spirit in future, said a press statement. “The SECP believes that the role of credit rating companies is crucial for the development of capital markets as they provide an independent view to the investors regarding the standing of a company or an instrument.” The issue was highlighted in the inspection reports of the commission’s first-ever onsite inspections of the credit rating companies in Pakistan conducted in 2015. Following which, show-cause notices were issued and hearings were held in the matter. The onsite inspections of credit rating companies would be a regular feature of the commission supervisory objective in future.
Published in The Express Tribune, February 23rd, 2016.
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