ISLAMABAD, May 27: Members of the National Assembly’s Standing Committee on Finance have told the committee chairman that it will be unwise to close the chapter of the March 2005 stock market crash by referring the issue to the parliament. Rather, a ‘pre-emptive strategy’ should be adopted to uncover those who are behind the alleged disappearance of the data on transaction of shares.
The committee is meeting in the Parliament House here on Monday.
Sources told Dawn that some members had appealed to the chairman to adopt a ‘pre-emptive strategy’ by targeting those officials of the Securities and Exchange Commission of Pakistan and the Karachi Stock Exchange, brokers and other stakeholders who had misinterpreted the securities market laws and tried to hide facts when they appeared as witnesses in previous meetings of the committee.
The National Assembly Secretariat is supposed to possess audio recordings of all the witnesses – SECP officials, brokers, forensic investigators etc – who appeared before the committee. Though the committee does not record statements of the witnesses on oath normally, still officials who appeared before the committee were supposed to be speaking the truth.
The issue has taken a new turn as former SECP chairman Dr Tariq Hassan has informed the committee that there are still chances to retrieve and recover the data of bids and orders of share transactions which were provided to the SECP by the KSE on directives of the former.
Dr Hassan is of the view that the KSE had provided not all but some very vital data of share orders and transactions to the SECP and also to the Task Force headed by Justice Saleem Akhtar that initially probed the market scam. The data - which can still determine the few big fish who had manipulated the market – was available with the SECP when Dr Hassan was the chairman but later it allegedly went missing.
The incumbent SECP chairman, Razi-ur-Rehman, has persistently told the committee that the KSE has not provided the data of orders of shares to the commission.
The lack of data availability had been the main hurdle in the way of the US forensic firm, Diligence, to ascertain anything that could uncover the faces behind the market crash.
Sources said some KSE and SECP officials had misinterpreted the securities laws before the committee which could be easily proven by the members by reading out the concerned rules to them.
According to the Sub-Rule (3) of the Rule (7) of the Securities Exchange Rules, 1971, “books of accounts and documents shall be preserved for a period not less than five years”.
Sources said Dr Hassan had told the committee that he could still provide the data which could prove how a few individuals and institutions caused the market fall.
However, Dr Hassan has a condition. And that is, if his successor Razi-ur-Rehman still believed that there was no data available with the SECP and Dr Hassan proved that there was the necessary, if not all, data available, then the committee would have to determine who wanted to cover up the issue.
Some members of the committee told Dawn that they would now try to launch a new investigation into the issue with the help of the data of the major pre-crash transactions as well as those which were carried soon after the market fall.
