H.G. MARKETS (PRIVATE) LIMITED vs COMMISSIONER-SMD, SECP Ss — 2024 CLD 1381 SECURITIES-AND-EXCHANGE-COMMISSION

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H.G. MARKETS (PRIVATE) LIMITED VS COMMISSIONER-SMD, SECP Ss. 57, Cls. (a) to (f), 123(8) & 123(10)---Commodity Exchange and Futures Contracts Rules, 2005, R. 20 & Sched.---Provisions relating to standards of conduct , non-compliance of---Whether broker fulfilled its duties diligently towards its customers ---Appellant (a futures broker of the Pakistan Mercantile Exchange/PMEX) was penalized by Securities and Exchange Commission of Pakistan ('the Commission')---Allegation levelled by the complainants was that they had given discretionary authority to the employees of the appellant to trade in their accounts and the employees of the appellant indulged in excessive trading with the sole objective of generating commissions, resultantly they lost all or a significant part of their investments---Validity---Pertinently, the Commission, in exercise of powers conferred under Commodity Exchange and Futures Contracts Rules, 2005 ('the Rules 2005') issued directions (along with approved template of a Discretionary Trading Authority (DTA) both in English and Urdu languages, to be executed on a non-judicial stamp paper) dated January 23, 2017 and April 28, 2017, inter alia, to all the brokers of PMEX, with respect to DTAs wherein, inter alia, it was mentioned that the loss threshold of 25% of the investment amount would trigger revocation of the DTA and the discretionary mandate would continue only upon obtaining a fresh DTA---However, as said directions were not the subject matter of the Show-Cause Notice (SCN) or the impugned order, nor the same had been discussed during the hearing in the instant appeal, therefore, no findings in that respect were rendered in present order---Appellate bench modified the impugned order to the extent that the penalty imposed upon the appellant vide impugned order was reduced to Rs.3,500,000/---Appeal was disposed of accordingly.

H.G. MARKETS (PRIVATE) LIMITED vs COMMISSIONER-SMD, SECP Ss — 2024 CLD 1381 SECURITIES-AND-EXCHANGE-COMMISSION-OF-PAKISTAN

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