PSX suspends AMCAP Securities trading rights

Says brokerage house was guilty of inaccurate bookkeeping among other violations.

KARACHI: The Pakistan Stock Exchange (PSX) has suspended trading rights of a brokerage house on Thursday after it failed to adhere to the rules and regulation in place.

The Exchange reported AMCAP Securities (Private) Limited was “in violation of various clauses of PSX rule book including but not limited to clients’ assets segregation and inaccurate bookkeeping.

“Consequently, the Exchange has decided to suspend all trading terminals of AMCAP with immediate effect…until further notice,” it said.

PSX performed an off-site limited scope investigation into the matters of observed regulatory non-compliances and issued show cause notice to AMCAP on March 31, 2017 for providing written explanation and, if desired, to appear before the regulator on April 04, 2017. However, it had sought unreasonable extension in time for the same to delay the process.

The PSX was of the view that the explanation could be provided by the brokerage house from the readily available information in its back office records and therefore, PSX granted a one day extension in consideration for them to collate information and provide satisfactory explanation.

“The revised deadline has also elapsed today [Thursday] at 5:00 PM and PSX has not been provided with any satisfactory explanation,” it said.

Earlier, the Exchange had ceased brokerage rights of at least three securities firm on alleged charges of misuse of investors’ funds since January 2017 when Chinese strategic investors acquired majority stake in PSX.

The three brokerage houses included MR Securities and AWJ Securities.

Published in The Express Tribune, April 6^th, 2017.

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