Law: Central Depository Company of Pakistan Regulations, 2002

Section: 4

Law: Brokers and Agents Registration Rules, 2001

Section: 8,12,ThirdSchedule

(a) Central Depository Company of Pakistan Regulations, 2002--Regln. 4---Brokers and Agents Registration Rules, 2001, Rr. 8, 12 & Third Schedule---Making blank sales in violation of Regulations---Imposition of penalty---Regln. 4 of Central Depository Company of Pakistan Regulations, 2002, prohibited blank sales, whereas findings of the Enquiry Officer had revealed 750 instances of blank sales during the review period---Brokerage house was obliged to ensure compliance with all applicable rules and regulations and appropriate internal control should prevent a customer from making a sale without holding pre-existing interest---Contention raised on part of the company that blank sales were made due to the negligence of the employees or that a customer undertook to deliver securities at the time of sale and later squared up his position, could not be accepted---Brokerage House had been established to have made blank sales on 750 occasions in violation of Regln.4 of Central . Depository Company of Pakistan Regulations, 2002---Rule 8 of Brokers and Agents Registration Rules, 2001 mandated that where Securities and Exchange Commission was of the opinion that a broker had failed to comply with any requirements of the Securities and Exchange Commission of Pakistan Act, 1997 or Securities and Exchange Ordinance, 1969 or any rules and directions or had failed to follow any requirements of the Code of Conduct laid down in the Third Schedule of Brokers and Agents Registration Rules, 2001, it could, in the public interest take action under Rule 8(a) or (b) of Brokers and Agents Registration Rules, 2001---Company having violated Rules and Regulations--by making blank sales, penalty of Rs.75,000 was imposed on the company, in circumstances. (b) Securities and Exchange Rules, 1971--- ----R.4(1)---Brokers and Agents Registration Rules, 2001, R.8---Failure to maintain order register---Rule 4(1) of Securities and Exchange Rules, 1971, provided that all orders to buy or sell securities which a member could receive, would be entered in the chronological order, in a register to be maintained by him in a form showing the name and address of the person who placed the…

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