Latest news with #SECP
Business Recorder
3 days ago
- Business
- Business Recorder
Govt well prepared to tackle any fallout: Aurangzeb
ISLAMABAD: Finance Minister Muhammad Aurangzeb said Tuesday that the government will ensure adequate stockpiles of petroleum products in the country keeping in view geopolitical tensions and regional developments in Middle East. Senator Muhammad Aurangzeb participated as the Chief Guest at the 'National Workshop on Transitioning to Defined Contribution Pension Schemes', organised by the Securities and Exchange Commission of Pakistan (SECP) at a local hotel on Tuesday. Finance Minister assured that Pakistan was well-prepared to navigate any potential fallout from regional instability. In his keynote address, the Minister began by briefing the participants on the recent geopolitical tensions and regional developments, sharing insights from a high-level meeting he chaired yesterday to review the evolving situation and its potential economic implications for Pakistan. He noted that in-depth discussions were held with key stakeholders on scenario planning, ensuring adequate stockpiles of petroleum products, and monitoring asset class pricing. He emphasised the government's firm resolve and preparedness to handle any eventuality, stating, 'We are in a good place — but hope is not a strategy. We have to plan for every possible outcome.' Touching upon international economic developments, Senator Aurangzeb shared details of his constructive and positive conversation with the US Commerce Secretary held late last night. He described the ongoing discussions on US tariffs as encouraging and noted that both countries are making steady progress and the broader objective is to deepen bilateral relations into a strategic economic partnership. Highlighting the government's reform agenda as laid out in the recently announced federal budget, the Minister reaffirmed the government's commitment to macroeconomic reforms. He emphasised that the government would continue to push forward on key areas such as privatization, tax reform, state-owned enterprise (SOE) restructuring, federal government rightsizing, pension, and public finance reform. Speaking on the subject of pension reforms, Senator Aurangzeb explained the rationale behind the government's decision to transition new civil servants to a Defined Contribution (DC) pension scheme, effective July 1, 2024. He underscored that this shift was a critical step taken even before addressing the legacy issue of unfunded pension liabilities. 'We had to stop the bleeding,' he said, referencing the fiscal burden of pension payments which have now exceeded one trillion rupees— surpassing the federal government's entire development budget. 'This raises a fundamental question of macroeconomic sustainability,' he added, stressing the urgency of reform. The Minister also commended provincial governments for their proactive role, particularly in the area of public-private partnerships and for taking the lead on defined contribution initiatives. He noted that the theme of the workshop—transitioning to defined contribution schemes—was both timely and significant, likening it to ongoing tariff reforms in its structural importance. Concluding his remarks, Senator Aurangzeb expressed confidence in the collective ability of stakeholders to bring about meaningful change in Pakistan's pension landscape, driven by sustainability, transparency, and long-term fiscal responsibility. Finance Minister underscored the urgent need for pension reform, noting the unsustainability of the current defined benefit system. In his address, Akif Saeed, Chairman SECP, outlined the progress made in developing a robust regulatory framework for DC pension schemes. He emphasised the critical role of technology, transparency, and awareness-building in shaping a modern and inclusive pension landscape. Federal and provincial government representatives shared updates on reform progress, with Khyber Pakhtunkhwa presenting valuable insights from its early implementation experience. The workshop served as a platform for dialogue among senior officials, regulators, financial sector leaders, and development partners. The SECP reaffirmed its commitment to working closely with all stakeholders to develop a transparent, reliable, and future-ready pension system that supports long-term financial security and inclusion. Copyright Business Recorder, 2025
Business Recorder
3 days ago
- Business
- Business Recorder
Insider trading: SECP secures first-ever conviction
KARACHI: In a landmark decision, the Sindh Special Court (Offences in Banks) has handed down the first-ever conviction for insider trading in Pakistan's history. The court found Zakir Hussain Somji, formerly an Assistant Vice President (AVP) of Investments at a private bank, guilty of insider trading in violation of Section 128 of the Securities Act, 2015. The case originated from an SECP inspection that identified suspicious trading activity through an analysis of Karachi Automated Trading System (KATS) data spanning from January 1, 2014, to February 2, 2016. It was suspected that Somji, by virtue of his position at private bank and access to the bank's investment decision-making processes, misused insider information for personal gain. Insider trading: SECP shares 27 cases with FIA An investigation revealed that Somji purchased 11,795,100 shares of various companies, with private bank appearing as the counterparty in the purchase of 1,230,900 shares — constituting 10.43 percent of his total buying. He subsequently sold 11,836,600 shares, of which 4,915,200 shares (41.52 percent) were sold back to private bank, earning an unlawful profit of Rs2.87 million. Following a detailed inquiry, SECP filed a formal criminal complaint under Section 128, punishable under Section 159 of the Securities Act, 2015. After a full trial — which included testimonies from SECP's Special Public Prosecutors and defence arguments — the Special Court delivered its judgment. The court noted that the accused's trades matched bank's on 173 occasions, a pattern deemed impossible without access to inside information. Despite Somji's denial of wrongdoing and claim of innocence under Section 342 of the Criminal Procedure Code (CrPC), the court held the prosecution's evidence 'cogent and unimpeachable.' Objections raised by the defence regarding unexamined joint account holders and senior officers were dismissed, as the trades in question were conclusively linked to Somji through his own CNIC. The court found the allegations 'in affirmative/ proved,' confirming that Somji committed the offence. It concluded these transactions amounted to front running, wherein Somji either bought shares ahead of bank's investment decisions or traded directly with the bank, reaping illicit profits. The judgment further noted that the accused, being an AVP Investment, was under a legal and ethical obligation not to trade against his own bank while in possession of insider information. A financial penalty of Rs8,599,938 — three times the unlawful gain — was imposed on Somji, to be deposited within seven days. The court explicitly stated that failure to pay within the stipulated period would result in Somji's remand to jail until the full amount is recovered. While the accused had undergone a lengthy trial since 2017, the court was not inclined to award a custodial sentence. The case stands as a landmark for insider trading prosecution in Pakistan's capital markets and a cautionary reminder of the consequences of breaching regulatory obligations. According to the SECP spokesperson, the judgment underscores the Commission's mandate to safeguard market integrity and protect investors, setting a strong precedent for future enforcement actions against market abuse and regulatory violations. Akif Saeed, Chairman of the Securities and Exchange Commission of Pakistan, commended the legal team, emphasising that the judgment would significantly boost investor confidence in Pakistan's capital markets and support capital formation. He expressed hope that this ruling would set a crucial precedent for other pending cases and ongoing inquiries into insider trading and market manipulation. Copyright Business Recorder, 2025
Arab News
3 days ago
- Business
- Arab News
Pakistan court delivers first-ever conviction for insider trading
KARACHI: A Pakistani court recently handed its first-ever conviction for insider trading, the Securities and Exchange Commission of Pakistan (SECP) said on Tuesday, hailing the judgment as one which will boost investors' confidence in the country's capital markets. Insider trading refers to the practice of buying or selling a publicly traded company's securities while in possession of material information that is not yet public information. The SECP said it had filed a case against Zakir Hussain Somji, assistant vice president of investments at Habib Metropolitan Bank (HMB) Limited, after inspecting suspicious trading activity from Jan. 1, 2014, to Feb. 2, 2016. The regulator said it was suspected that the accused, through his position at HMB, misused insider information related to the bank's investment and disinvestment decisions for personal gain. The SECP said a probe revealed Somji bought 11,795,100 shares of various companies, including 1,230,900 shares (10.43 percent) acquired from HMB. He sold 11,836,600 shares — 4,915,200 (41.52 percent) of which were sold back to HMB, earning an 'unlawful profit' of Rs2,866,646 [$10,116.39]. 'Sindh Special Court (Offences in Banks) handed out first ever conviction for insider trading in the history of Pakistan in a case filed by The Securities and Exchange Commission of Pakistan (SECP),' the regulator said. It said Somji had been convicted by the court on June 14 for violating provisions of Section 128 of the Securities Act, 2015, which related to insider trading. The regulator said the court slapped Somji with a penalty of Rs 8,599,938 [$30,380] which was three times the 'unlawful gain.' 'The amount is to be deposited within seven days, failing which the convict will be remanded to jail until full payment is made,' the SECP said. The regulator said the judgment reaffirms SECP's mandate to ensure market integrity and investor protection. 'It sets a strong precedent for future enforcement actions and sends a clear message that market abuse and regulatory violations shall not be tolerated,' it added.
Business Recorder
4 days ago
- Business
- Business Recorder
Pakistan prepared for regional fallout, optimistic on US tariff talks: Aurangzeb
Amid rising geopolitical tensions in the Middle East, Finance Minister Muhammad Aurangzeb on Tuesday assured that Pakistan was well-prepared to navigate any potential fallout from regional instability. Addressing at the 'National Workshop on Transitioning to Defined Contribution Pension Schemes' being organised by SECP at Marriott Hotel in Islamabad, the finance minister informed that the government had a detailed meeting on Monday with all the stakeholders to 'ensure that we have enough stocks, we have a good view on the pricing across asset classes and we are well prepared for any eventuality'. 'We are in a good place concerning the actions we might need to take, in case things go towards further escalation. I hope they don't,' the finance minister assured. Renewed strikes by Israel and Iran over the weekend increased concerns that the battle could widen across the region and significantly disrupt oil exports from the Middle East. To counter this, Prime Minister Shehbaz Sharif on Monday constituted a high-level committee to monitor petroleum product prices and supply dynamics amid regional tension. On ongoing discussions on US tariffs, Aurangzeb informed that he had a 'very constructive and positive' meeting with Howard Lutnick, the United States' Commerce Secretary, on Monday. 'Both countries are moving towards the right direction, in terms of ensuring that Pakistan is in a good place on a competitive basis, when it comes to US tariffs, and more importantly, we continue to move forward in terms of the strategic partnership between Pakistan and the US,' he said. Back in April, Trump ignited a potentially ruinous trade war as he slapped sweeping tariffs on imports from around the world and harsh additional levies on key trading partners, including Pakistan. Islamabad is trying to appease the US to seek reprieve from the 29% reciprocal tariffs imposed by President Donald Trump. Meanwhile, Aurangzeb reiterated that the government intends to 'stay the course' in terms of structural reforms revolving around energy, SOEs and taxation. 'This time around, we have done a fundamental reform around tariffs, and how we want to move the country towards a competitive economy and bring down the wall of protection, so that our export industry moves forward,' he said. Aurangzeb said that the government is bringing down the cost of debt servicing. He shared that pension payments have crossed a trillion rupees, which is more than the federal government's development budget.
Business Recorder
4 days ago
- Business
- Business Recorder
Senate panel clears new clause: Oversight Board to conduct audit firms' inspection
ISLAMABAD: The Senate Standing Committee of Finance on Monday approved a new clause for inspection of audit firms referred by the Federal Board of Revenue (FBR) under the Finance Bill 2025-26. The inspection of audit firms would be done by the Audit Oversight Board. The FBR and the Securities and Exchange Commission of Pakistan (SECP) strongly pleaded their case for introducing a new section in the sales tax law for inspection of audit firms by Audit Oversight Board. While review of the Finance Bill 2025-26 at the Senate Standing Committee of Finance on Monday, the SECP Commissioner, Securities Market Division and FBR Member Inland Revenue (Policy) defended the proposed section (58C- Inspection of audit firm) under the Finance Bill 2025-26. Both top officials of the SECP and the FBR clarified that the inspection would not be done by the tax officials, but the Audit Oversight Board would do the necessary job. The new legislation will empower Audit Oversight Board to monitor audit firms, involving Chief Commissioners in referring cases to the Oversight Board and ensuring prior notice is issued before inspections. Under proposed Section 58C in the Sales Tax Act, 'Where in case of a registered person, whose accounts are subject to audit under the Companies Act, 2017, Chief Commissioner Inland Revenue has reason to believe that the audited accounts do not reflect the true and fair view of sales and purchases and related sales tax liability, he or she may with the approval of the Board, refer the audit firm, who has issued audit certificate to that registered person for inspection to Audit Oversight Board', it added. Chairman of the committee Senator Saleem Mandviwalla read the objections raised by Institute of Chartered Accountants of Pakistan (ICAP) on the proposed section in the Sales Tax Act. Mandviwalla informed the committee that Auditor General of Pakistan (AGP) conducts audit of only 10 percent of the cases selected for audit. Similarly, audit firms also conduct audit of selected number of companies to check whether these companies are doing anything wrong in their audited accounts/financial records. Holding them responsible for all wrong doings by the companies would not be appropriate, he said. Senator Mandviwalla remarked: Audit firms, conduct only 10 percent of audits—this is unacceptable. The FBR officials explained that many audit firms are failing to meet international standards and merely 'stamp papers.' Copyright Business Recorder, 2025
