Pakistan Stock Exchange (PSX) on Wednesday suspended the license of M/S AMCAP Securities (Pvt) Ltd, known as AMCAP brokerage house in the stock market, as it was found to be involved in violation of various clauses of the PSX Rule Book, including but not limited to clients’ assets segregation and inaccurate bookkeeping.
AMCAP is a registered brokerage house of Lahore (Punjab) and the sixth brokerage firm which was suspended by the PSX in the last 45 days, owing to irregularities in stock trading.
“PSX performed an off-site limited scope investigation into the matters of observed regulatory non-compliances and issued a show cause notice dated March 31, 2017 to AMCAP for providing a written explanation and if desired, to appear before the undersigned along with the same by 5:00 pm, April 04, 2017,” the notice said. However, AMCAP sought an unreasonable time extension in order to delay the process, it added.
PSX was of the view that the explanation could be provided by AMCAP from the readily available information in its back office records and, therefore, the PSX granted an extension of one day in consideration for them to collate the information and provide a satisfactory explanation.
The revised deadline has also elapsed on Wednesday at 5:00 pm and the PSX has not been provided with any satisfactory explanation. The PSX had issued notices to 15 TREC holders in February 2017, as their accounts were not being matched with the investors’ accounts.
Consequently, the Exchange has decided to suspend all trading terminals of AMCAP with immediate effect under Clause 4.27.2 of PSX Regulations until further notice, the notice added.
This is the sixth brokerage firm whose trading license was suspended by PSX after suspending the following’s; M/s S-Z Securities (Lahore), M R Securities (Lahore), AWJ Securities of Islamabad, MAM Securities (Lahore) and Stock Street Securities (Pvt) Islamabad.
In May 2016, the PSX suspended the license of Stock Street Securities (Islamabad), but the investors of this brokerage house are still waiting for their money. While in February 2017, PSX suspended licenses of M R Securities of Lahore, AWJ Securities of Islamabad and MAM Securities of Islamabad.
AMCAP was a corporate member of the Lahore Stock Exchange (G) Limited since 2007. The company is principally engaged in the business of brokerage, underwriting, buying and selling of stocks, shares, modaraba certificates etc.
In addition, the Federal Investigation Agency (FIA) has unearthed a billion rupees scam in PSX and has arrested a front man of M/s Zafar Moti Securities and Adam Securities, while the PSX did not take any action against the other securities till now. The officials of PSX said that the SECP and PSX are still investigating Zafar Moti Securities and Adam Securities case.
Meanwhile, the sources at PSX said that over 70 claims have so far been filed by the investors against Zafar Moti Securities and Adam Securities. All the cases have been forwarded to the SECP for scrutiny, they added. In this connection, the officials of SECP, including its chairman Zafar Hijazi are silent.
Meanwhile, the FIA had arrested Wamiq Mohammad Yousaf, a front man of Zafar Moti Securities and was currently investigating this fraud case. According to the FIR, Wamiq has cheated over 100 investors, illicitly gaining billions of rupees through stock market in 2016 alone.
