ISLAMABAD, July 14: The employees of the Securities and Exchange Commission of Pakistan (SECP) have informed the policy board that nepotism and violation of promotion rules have resulted in constant deterioration in performance of the commission.

Not all of the eight-member board were present here on Saturday when it met under the chairmanship of Adviser to the prime minister on Finance Dr Salman Shah.

But, sources said, that the employees of the commission informed the board about millions of rupees, which some “favourites” squeezed from the SECP on monthly basis in the form of advertisements.

The attention of the board was also drawn towards the alleged kickbacks prevalent in the commission and which were pocketed through purchases, renovations and consultancies.

The policy board also discussed the promotion procedure, which was approved by SECP Chairman Raziur Rehman instead of the board.

Sources said the board also discussed amendments in the promotion procedure of the SECP, which many employees felt was carried out in order to pave the way for the promotion of some “blue-eyed” employees. There were also allegations that the promotion procedure was amended in haste without taking into account the generally recognised principle of “seniority-cum-fitness”.

The board was told that recently some “very junior” officers were promoted. They were also paid promotion bonus, which was allegedly against the rules and laws of the commission.

The post of ‘Registrar Appellate Bench’ was allegedly upgraded to the level of director to make possible the promotion of a joint director, who had been declared disqualified for the post of the joint director (securities market division of SECP) by the selection committee. His salary was also raised by hundred per cent after the promotion.

The policy board was also informed about the waiver of deficiency of qualification of one of the executive directors, who is being paid as high a salary as Rs340,000 per month. The issue of appointment of other high-ups on lucrative salaries had also been raised at the meeting, sources said.

The main objective of the policy board is to provide guidance to the SECP in all matters relating to its functions and to formulate policies in consultation with the commission.

The board is also responsible for advising the government on matters falling within the purview of the Securities and Exchange Act and other corporate laws and also to express its opinion on policy matters referred to it by the government or the commission.

The meeting also discussed the issues of the demutualisation of the stock exchanges, Real Estate Investment Trusts and amendments to the Companies Ordinance.