ISLAMABAD: The Sec­uri­ties and Exchange Commission of Pakistan (SECP) filed on Tuesday a criminal complaint against a stock trader who manipulated the share price of Gauhar Engineering Limited (now Drekkar Kingsway Limited).

The SECP has started a crackdown against malpractices in the stock market and this is the second complaint filed by the SECP within two weeks.

Though SECP officials declined to name the accused in the price manipulation, sources in the finance ministry told Dawn that the case had been filed against Bilal Aurangzeb Noor who used his personal trading account as well as that of Noor Capital for trading in the shares of GAEL.

Since Mr Noor was an authorised person to trade on behalf of GAEL, he had the privileged access to profit-and-loss statements of GAEL’s trading account, which was the primary source of income for GAEL.

The SECP inquiry noted that Mr Noor used this privileged information, which was not disclosed to public and on that he made a total profit Rs6.25 million through his personal as well as Noor Cap’s account by trading in GAEL’s shares from Dec 9, 2014 till Feb 12, 2015 while using inside information and manipulation.

The investigation conducted by the SECP revealed that the accused and his associates bought a major stake in Gauhar Engineering Limited (GAEL) in 2014 at a subsidised rate, as Gauher Engi­neering at that time was on the Pakistan Stock Exchan­ge’s defaulters’ counter.

Upon resumption of trading, the accused placed significant buying orders to increase the price of shares and subsequently these shares were sold to market participants at higher prices to earn substantial gains.

The accused also used his private limited company in which he and his family had majority shareholding.

Published in Dawn, March 8th, 2017