Introduction

Today, Thursday, the Capital Markets Authority announced the issuance of two final decisions by securities dispute resolution committees in which three persons were found guilty of violating the financial market system, in addition to violating the rules of conduct in the market, and ordered them to pay the total amount . illegal profits, which amounted to more than 115 million rials, in addition to the imposition of financial penalties in the amount of 2.45 million rials.

First Final Decision

The Board said the Securities Appeals Committee has rendered its first final judgment convicting each of: Sultan bin Abdulaziz bin Abdullah Al Bunyan, Abdullah bin Abdulaziz bin Abdullah Al Bunyan and Fahd bin Abdulaziz bin Abdullah Al Bunyan for violating paragraph (a) Article (49) of the Financial Market System, obliging them to pay out a total illegal profit which amounted to 60.74 million rials, and imposing financial penalties on them in the amount of 300,000 rials for carrying out a number of procedures and transactions submitted when making financial transfers, share transfers and special deals in Al Kathiri Holding Company shares to hide their ownership interest in it, which led to a misrepresentation of the number of shares available to the public between May 30, 2019 and October 10, 2019 CE. before they were listed on the main market on November 3, 2019, resulting in an impact on the share price the day after the company announced its introduction. requesting a transfer to the main market as these actions and practices have created a misleading and misleading impression of the company’s security value.

Second Final Decision

While the Appeal Committee, in its second final decision, convicted Fahd bin Abdulaziz bin Abdullah Al-Bunyan for violating paragraph (a) of section (49) of the Capital Market Law and section 2 of the Rules of Conduct in the Market when Trading Shares. the following companies: Naseej International Trading Company (Naseej), Saudi Cable Company (Saudi Cable), National Company for Manufacturing and Casting Metals (Maadaniah), Tihama Advertising and Public Relations Company (Tihama), Red Sea International Company (Red Sea) , Saudi Fish Company (Al-Asmaq), Eastern Development Company (Eastern Development), Allianz Saudi Fransi Co-Insurance Company (Allianz SF), Abdullah Saad Muhammad Abu Moati Library Company (Abu Moati), Al-Omran Industry and Trade Company (Al-Omran), Raydan Food Company (Raydan) and Sumou Real Estate Company (Sumu), obliging him to pay the total amount. Illegal proceeds amounted to 55.04 million rials and he was fined from January 15, 2019 to November 25, 2020.

Violation of Share Prices

His violation consisted of placing buy orders through his investment portfolio in order to influence the share prices of the aforementioned companies, as well as placing buy orders in order to achieve a high closing price of the auction, since these actions and practices constituted fraud and manipulation. , and gave her a misleading and incorrect impression of the securities of the aforementioned companies.

Additional Penalties

In addition to financial penalties, these two decisions included the imposition of another fine on Fahd bin Abdulaziz bin Abdullah Al-Bunyan, which included a ban on buying and selling shares of companies listed in the financial market on his own behalf or on behalf of others. except for trading through investment funds with financial market institutions for three years, the first decision also prohibited him from trading shares of listed companies on his own behalf or on behalf of others. for a period of one year, according to the second decision.

Collaboration and Cooperation

The Office explained that the final decisions of the Securities Appeal Committee were made as a result of joint coordination and cooperation between the Office, the prosecutor’s office and the relevant security authorities, and in light of the general criminal case filed by the prosecutor’s office and referred to it by the Capital Market Authority in relation to a number of offenders. .

Efforts to Protect Investors

The Capital Market Authority also confirmed that it is constantly working to monitor any conduct that violates the financial market law, the rules for its application and the rules that it is authorized to enforce, arrest violators and follow the necessary procedures to impose dissuasive sanctions against them in order to strengthen the efforts of the financial market system aimed at creating an attractive investment environment for all categories Investors are protected from activities that are unfair or improper or that involve fraud, fraud, misrepresentation, misrepresentation or manipulation.

Pursuing Manipulators

The Authority stressed that it will not hesitate to pursue financial market manipulators by monitoring their transactions based on its authority under the financial market system and advanced technical means that enable it to track all transactions and monitor suspicious cases and take necessary action. legal measures in accordance with laws and regulations, in addition to coordinating with security authorities. Each, in accordance with its competence, tracks down anyone who tries to manipulate or deceive in the financial market, and that this happens in order to achieve the objectives of the Office to strengthen the efficiency of the financial market, protecting its dealers and ensuring that they are not deceived or manipulated.

Compensation for Damages

A person who has suffered from the violations that are the subject of this case has the right to file an individual or collective claim with the Arbitration Commission against the convicts for compensation for the damage caused by these violations, provided that this is preceded by filing a complaint in the Capital Market. Authority in this regard, noting that the General Secretariat of the Arbitration Committees will announce to the public on its website the limitation of any class action so that other investors affected by the same violations can apply to the Committee to join the class action. claim.

Public Announcement of Violators

The Authority indicated that the General Secretariat of Securities Dispute Resolution Committees announced to the public on its website the identities of the offenders after violations and penalties were proven and two final decisions of the Securities Appeals Committee were made against anyone. who violated the rules of the financial market and the rules for its implementation.