Azgard Nine scam: TIP seeks action in insider trading case

SECP initiates action on its own report, but leaves out some powerful persons.


Our Correspondent May 23, 2013
Chief Justice Iftikhar Muhammad Chaudhry addressing the International Judicial Conference. PHOTO: APP

KARACHI:


Transparency International Pakistan (TIP) in a letter to the Chief Justice Iftikhar Muhammad Chaudhry has urged the apex court to take action against all entities involved in insider trading in the Azdgard Nine shares.


The allegations of insider trading in Azgard Nine Limited (ANL) shares traded by JS Global Capital Ltd propped up in 2007/2008 involving 38 companies and individuals.

The said group had artificially inflated the prices of ANL and then made massive sell-off bringing colossal losses to scores of investing individuals and institutions.

TIP said that SECP initiated some action on its own investigation report of April 2009, and after four years in April 2013 it filed a criminal complaint against 23 companies and individuals, but did not move against the rest of the 15 companies.



TIP has also sought action against Jahangir Sidiqui Company Limited (JSCL) for awarding fee of $4.2 million to a director in 2013.

The complaint against JS Group was sent by TIP to the chairman SECP on 10 April 2013 with request to examine the evidence that could result in recovery of fine at the rate of three times the illegal profit, which may be over Rs75 billion, as well as other punitive actions against companies as well as against persons involved.

The SECP investigation report conducted on the insider trading of Azgard Nine Limited (ANL) under the orders of Chairman SECP dated 15 April 2009, found that the group of 38 companies artificially increased the shares price of ANL from Rs22 to Rs96 per share. The report determined that this is a typical price manipulation case. SECP report also determined that the above trading volumes were executed with a view to generating artificial trading in ANL shares and the JSGL Group was heavily involved in execution of circular trade to move the price up.

The allegations are very serious, and should have been handled by SECP and State Bank of Pakistan, but SECP after even conducting an inquiry in 2008, which proved the serious fraud, did not take any action during the political government, obviously due to pressure from higher offices.

Published in The Express Tribune, May 23rd, 2013.

COMMENTS (1)

Billo | 10 years ago | Reply

"but SECP after even conducting an inquiry in 2008, which proved the serious fraud, did not take any action during the political government, obviously due to pressure from higher offices." And TIP, pressured by some other corrupt officials realises this 5 years later!!

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