Law: Securities Act, 2015

Section: 64,65

Securities Act (III of 2015)--- ----Ss. 64 65---Securities Brokers (Licensing and Operations) Regulations, 2016, Regln. 16---Pakistan Stock Exchange Limited Regulations, Regln. 4.4.6---Circular No. 20 of 2017---Licensing requirement---Eligibility for licensing---Unauthorized deposit taking by securities brokers---Scope was imposed upon a penalty and its license as a securities broker was suspended for accepting money from its customers and individuals with a pre-determined rate of return---Held; appellant could not indulge in any activity which its license did not permit in terms of Ss. 64(2) 65(2) of Securities Act, 2015 and Regln. 4.4.6 of Pakistan Stock Exchange Limited Regulations---Regulation 16(2)(k) of the Securities Brokers (Licensing and Operations) Regulations, 2016, provided that the securities broker would not accept any money from a customer on a promise of pre-determined or guaranteed returns argument that the Circular No. 20 of 2017 had given brokers a time period of 60 days to comply with the regulations and that the Regulations only had a prospective effect had no merit---Circular No. 20 of 2017 was only issued to warn brokers from further unauthorized deposit taking activity---Even before issuance of Circular No. 20 of 2017, the appellant was under an obligation to ensure that no unauthorized deposit was accepted had given assurances that it would fully comply with the law and return the loans from customers but it failed to do so---No reason existed to interfere with the impugned order and the same was upheld---Appeal was disposed of accordingly. ORDER 1. This Order is passed in the matter of appeal No. I04 of 2017 filed under section 33 of the Securities and Exchange Commission of Pakistan Commission Act, 1997 against the Order dated 11/10/17 (the Impugned Order) passed by the Commissioner, Securities Market Division (the Respondent). 2. The brief facts of the case are that the Securities and Exchange Commission of Pakistan (the Commission) conducted review of annual accounts of Switch Securities (Private Limited (the Appellant) for the year ended 30/06/16. Review of the Accounts revealed that the Appellant has received an amount of…

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