SEC indicts 4 more pump and dump era manipulators
True to its promise made half a decade ago, the Securities and Exchange Commission of Sri Lanka (SEC) is pursuing share market manipulators in the infamous pump and dump era.
One by one the regulator is closing in on offenders during 2011 to 2013 when the worst manipulations of the stock market by high net worth investors happened creating a bubble.
The second one in less than three months, the SEC on July 25 filed action before the Fort Magistrate’s Court against Lanka Kannangara, Fariq Furkhan, Kapila Senarath Bandara and Raveendra Mallawarachchi for market manipulation, conspiracy to commit market manipulation and aiding and abetting shares of Radiant Gems International PLC (RGEM) listed on the Colombo Stock Exchange (CSE) during September 2 to 29, 2011. In June the SEC filed charges against Ireland- based Dr. Muhammed Bafiq Nizar and his brother-in-law Mohamed Imtiaz Samsudeen at Magistrate’s Court Colombo Fort after six long years on charges of market/price manipulation on doctor channeling company, E-Channeling PLC.
Both are of the 17 probes on stock market manipulations during former SEC chairman Thilak Karunaratne’s time which were closed upon his resignation by his successor Nalaka Godahewa who was appointed by former President Mahinda Rajapaksa in August 2012. There are at least two more probes the SEC is working on which cases are expected to be filed before December, SEC sources told the Business Times.
In the latest case, the accused, investment advisors of different stockbroker firms, had placed orders in the RGEM share using the CDS accounts of certain clients of such stockbroker firms. Such share trading executed by the aforesaid defendants had created a false and misleading appearance of active trading, with respect to the market and the price of the RGEM share, the SEC said in a statement. If found guilty the accused shall be liable to an imprisonment not exceeding five years or to a fine not less than Rs. 50,000 and not exceeding Rs. 10 million or to both.