«السوق المالية»: إدانة وتغريم 15 مخالفاً أكثر من 22.7 مليون ريال

The Capital Market Authority announced the issuance of two final decisions by the Appeals Committee in Securities Disputes against 15 violators for violating Article 49 of the Capital Market Law and Article 2 of the Market Conduct Regulations. Additionally, one of them was convicted of violating Article 31 of the Capital Market Law and Article 5 of the Securities Business Regulations; the convicted parties were fined more than 10.7 million riyals and were obligated, along with other investors, to pay more than 12 million riyals for the illegal gains realized from these violations.

Fraud, Manipulation, and Deception

According to the first decision of the Appeals Committee, the following individuals were convicted: Hassan bin Abdulkarim bin Ibrahim Al-Maiouf, Shahd bint Ghadeer bin Saleh Al-Rasheed, Saleh bin Ghadeer bin Saleh Al-Rasheed, Latifa bint Fawzan bin Abdulrahman Al-Sulaiman, Imran bin Muhammad bin Imran Al-Imran, Reem bint Muhammad bin Imran Al-Imran, Afnaan bint Muhammad bin Imran Al-Imran, Ahmad bin Saad bin Abdullah Al-Huwail, Nora bint Abdullah bin Saad Al-Huwail, Muhammad bin Abdullah bin Muhammad Al-Hawshan, Ahmad bin Muhammad bin Abdullah Al-Hawshan, Abdullah bin Muhammad bin Abdullah Al-Hawshan, Omar bin Muhammad bin Abdullah Al-Hawshan, Khalid bin Ibrahim bin Abdullah Al-Jarwi, and Muhammad bin Nasser bin Muhammad bin Imran, for violating Article 49 of the Capital Market Law and Article 2 of the Market Conduct Regulations while trading shares of the following listed companies: Integrated Insurance Company (formerly Allianz Saudi French Cooperative Insurance), Saudi Arabian Cooperative Insurance Company (SAICO), Arab Cooperative Insurance Company (Arab Insurance), Al-Saqr Cooperative Insurance Company (Al-Saqr Insurance), United Cooperative Insurance Company (United Insurance), and T'Chubb Arab Cooperative Insurance Company (T'Chubb), during the period from 30/08/2021 to 06/07/2022; these actions and practices constituted manipulation and fraud and created a misleading and incorrect impression regarding the securities of the aforementioned listed companies. Their violation consisted of entering buy orders through their investment portfolios or the portfolios they manage to influence the stock prices, some of which were linked to sell orders.

Penalties for the Convicted

The second decision convicted Khalid bin Ibrahim bin Abdullah Al-Jarwi of violating Article 31 of the Capital Market Law and Article 5 of the Securities Business Regulations; for engaging in a securities business activity represented by (management), by managing two investment portfolios without obtaining a license from the Capital Market Authority.

The two decisions included imposing several penalties on the convicted individuals, including varying financial fines totaling more than 10.7 million riyals, and obligating 13 convicts to pay more than 6.7 million riyals for the illegal gains realized on their investment portfolios. Additionally, the Appeals Committee in Securities Disputes prohibited Khalid bin Ibrahim bin Abdullah Al-Jarwi from trading directly or indirectly in the financial market for five years, as well as from practicing brokerage, managing portfolios, or working as an investment advisor for five years.

The committee also obligated several investors to pay more than 5.5 million riyals for the illegal gains realized on their investment portfolios, resulting from the violations committed by the convicts Khalid bin Ibrahim bin Abdullah Al-Jarwi, Imran bin Muhammad bin Imran Al-Imran, and Muhammad bin Nasser bin Muhammad bin Imran.

Monitoring Violating Behaviors

The Capital Market Authority clarified that the two final decisions of the Appeals Committee in Securities Disputes resulted from coordination and joint cooperation between the authority and the relevant parties, in light of the public prosecution case filed by the Public Prosecution and referred to it by the authority against the investors for violating the Capital Market Law.

The authority emphasizes the importance of investor confidence in the financial market for its growth and development, as it continuously works to monitor any violating behaviors, apprehend the perpetrators, and complete the necessary procedures to impose deterrent penalties against them, thereby enhancing its efforts to create an attractive and safe investment environment free from unfair practices or those involving deception or manipulation.

Claim for Compensation

For its part, the General Secretariat of the Committees for the Settlement of Securities Disputes announced that any affected party from these violations has the right to file an individual or collective claim with the Committee for the Settlement of Securities Disputes against the convicted parties to seek compensation for the damages resulting from these violations. Additionally, anyone who entered into an agreement or contract with the convicted Khalid bin Ibrahim bin Abdullah Al-Jarwi regarding the violation of Article 31 of the law may file a claim to request the annulment of the agreement or contract and the recovery of any funds or other properties paid or transferred under the agreement or contract, in accordance with paragraph (b) of Article 60 of the Capital Market Law, provided that a complaint is submitted to the authority regarding this matter prior to any of the two decisions. It is worth noting that the General Secretariat of the Committees for the Settlement of Securities Disputes will announce to the public on its website when any collective claim is registered so that other investors affected by the same violations can apply to join the collective claim.

The authority indicated that the General Secretariat of the Committees for the Settlement of Securities Disputes has publicly announced on its website the identities of the violators after the violations and penalties were confirmed and the final decisions were issued by the Appeals Committee in Securities Disputes.