Print Edition - 2018-01-10 | MONEY
3 brokerage firms fined Rs1m each
Jan 10, 2018-
The Securities Board of Nepal (Sebon) has imposed a fine of up to Rs1 million each on three stock brokering companies — Agrawal Securities, Shreehari Securities and Siprabi Securities — for carrying out transactions of counterfeit share certificates and for failing to conduct due diligence of clients before carrying out transactions.
This is the first time the secondary market regulator had imposed such a huge fine on stockbrokers who flouted the rules.
According to Sebon, Agrawal Securities had conducted transactions using fake share certificates of Chilime Hydropower, while Shreehari Securities was found carrying out transactions using counterfeit share certificates of National Hydropower. These brokerge companies had also failed to conduct due diligence of their clients and deliberately ignored to enforce internal control measures to prevent misconducts during share transactions. As per the Sebon, each of these brokerage company has been fined Rs1 million while the companies’ chief executive officers have been fined Rs50,000 each. Sebon’s Deputy Spokesperson Niranjaya Ghimire said the action was taken against stockbrokers as per the provisions in the Money Laundering Prevention Act. Earlier on July 7, Sebon had filed a case at the Kathmandu District Court against Govinda Ghimire, the individual suspected of putting counterfeit share certificate of Chilime Hydropower, National Hydropower and Sanima Mai Hydropower into circulation. Ghimire is at large.
In the meantime, the Sebon has imposed a fine of only Rs50,000 on CEO of Siprabi Securities for involvement in transaction of counterfeit shares certificates. The brokerage company had informed the regulator about the wrongdoing after carrying out the transaction itself. “Since the firm had informed the regulator on time, Sebon has deducted the fine amount,” Ghimire said.
Published: 10-01-2018 08:20