ISLAMABAD: The Securi­ties and Exchange Commission of Pakistan (SECP) has decided to act against individuals who regularly express opinions on the stock market’s performance on social media.

“Behaving like stock market gurus and making suggestions about investments are illegal. This is a form of manipulation called inducement, which is a crime under Securities Act 2015,” said Yasir Manzoor, head of the SECP’s Market Surveillance, Supervision and Enforcement Department, while speaking at a workshop on insider trading and market manipulation on Tuesday.

Mr Manzoor said there are many kinds of market manipulation, such as wash trade, pump-and-dump, spoofing and false statements.

“One of the latest forms of market manipulation is issuing a false statement mainly through social media,” he said. “The SECP is trying to keep a check on such activities. A list of 33 such links and pages has been forwarded to the Federal Investigation Agency (FIA).”

Mr Manzoor said it is the regulator’s duty to contain market manipulation and protect investors. “It is also important because whenever the market crashes or a large number of investors face losses, everybody criticises the regulator for not acting against market manipulators,” he said.

Mr Manzoor said the SECP has taken serious notice of some brokerage houses’ involvement in the placement and cancellation of orders to create a false impression of trading activity. This is called spoofing, he said.

To contain market manipulation, the SECP has filed seven criminal complaints in the current year against market abuses and two criminal complaints against the senior employees of two banks for being involved in booking profits through insider trading.

Separately, the SECP approved the listing of wheat futures contracts on the Pakistan Mercantile Exchange (PMEX).

Published in Dawn, April 26th, 2017

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