SEC probes take a decisive turn
The Securities and Exchange Commission (SEC) is reopening investigations in cases that were closed during the past regime in a bid to determine if ‘all’ information had been considered in scrutinising the alleged malpractices especially when files were closed due to ‘insufficient’ information.
“This was a popular ‘excuse’ when certain probes didn’t see the light of day,” an analyst commented, adding that this should be sufficient cause to restart inquiries pertaining to market misconduct.
This new turn in the SEC has come on the back of Prime Minister Ranil Wickremasinghe slamming corrupt sections of Sri Lanka’s private sector to the extent of naming businessmen like Dilith Jayaweera and Nimal Perera.
“There are a number of allegations of violations of the Colombo Stock Exchange market rules and SEC regulations. The minor ones were compounded. Thirteen large cases were abandoned purportedly on a lack of evidence,” he told parliament, adding that they were not probed or were settled when it should have been probed further.
“I would like this to be recorded in the Hansard. I have requested the Securities and Exchange Commission to go into these cases. If necessary, I will bring legislation to permit such inquiry. I am also seeking the appointment of a Parliamentary Select Committee (PSC) to inquire into these transactions.”
A SEC source said that a PSC is not immediate, but his comments on compounding and abandoning certain cases purportedly were being pursued in all ‘seriousness’. “We want to verify whether earlier they (SEC) had ‘sufficiently’ gone into matters with these probes.” Further he said that many are now coming forward with stock market related complaints as they feel that there’s a free and fair climate for investigations. “They are free from fear and intimidation,” he said, noting that the SEC has got a ‘substantial’ number of complaints pertaining to share market misconduct during the past two months.
“We have received files full of complaints. Some are with names and some anonymous,” he said, adding that these complaints range from manipulation, insider dreading, pump and dump, stockbrokers and investment advisors misleading small shareholders, trading on accounts under third party names, etc.