ACRSD issues ruling against Capital Market Law violators

Logo of General Secretariat of the Committees for Resolution of Securities Disputes

The General Secretariat of the Committees for Resolution of Securities Disputes (GS-CRSD) announced that the Appeal Committee for the Resolution of Securities Disputes (ACRSD) issued a final decision on Jan. 25 in the case filed by the Capital Market Authority (CMA) against some violators of the Capital Market Law and its Executive Regulations, according to the CRSD website.

The violators include Khalid bin Nasser bin Abdullah bin Muhaini, Haitham bin Fahad bin Mazyad Almazyad, Mish'al bin Abdulrahman bin Muhammad Alruqaeb, Muhammad bin Abdulrahman bin Muhammad Alruqaeb, Salma bint Muhana bin Hamad Aljash'ami Alshammari, Abdulrahman bin Abdulaziz bin Abdulrahman Almane, Ibrahim bin Muhammad bin Ibrahim Al Othman Altamimi, Fahad bin Khamis bin Muhammad Al Hudayb, Ahmad bin Saleh bin Muhammad Alsultan, Muhammad bin Khamis bin Muhammad Al Hudayb, Abdulmohsen bin Abdulaziz bin Abdulrahman Alshuwaiman, Ziyad bin Hamad bin Zaid Alswaygh, Faisal bin Abdullah bin Muhammad Bin-Saedan, and Talal bin Muhammad bin Salem Alomari.

The decision concluded with the conviction of the respondent Talal bin Muhammad bin Salem Alomari of violating Article (12.c) of the Market Conduct Regulations issued pursuant to the CMA board resolution No. (1-11-2004) dated Oct. 4, 2004.

The decision also concluded with the conviction of the remaining respondents of violating Article (12.d) of the Market Conduct Regulations, when trading shares of a number of listed companies after the latter respondent, Alomari, who was registered with EFG-Hermes, disclosed information to remaining respondents on client orders with the financial group he works for. Accordingly, they benefited from the essential effect of such orders when trading shares of Bank AlJazira, Saudi Arabian Mining Co. (Maaden), Astra Industrial Group, United Wire Factories Co. (Aslak) and Seera Group Holding.

This also included shares of Leejam Sports Co. (Fitness Time), SABIC Agri-Nutrients Co., Saudi Ceramic Co. (Saudi Ceramics), Savola Group, Ayyan Investment Co., Saudi Industrial Investment Group (SIIG), Saudi Vitrified Clay Pipes Co. (SVCP), Tabuk Cement Co., National Medical Care Co. (CARE), Middle East Healthcare Co. (Saudi German Health), National Shipping Company of Saudi Arabia (Bahri), Saudi Automotive Services Co. (SASCO), Arriyadh Development Co., Aldrees Petroleum and Transport Services Co., Saudi Research and Media Group (SRMG), United International Transportation Co. (Budget Saudi), Saudi Electricity Co., Al Jouf Cement Co., stc, Etihad Etisalat Co. (Mobily), The Company for Cooperative Insurance (Tawuniya), and Arabian Shield Cooperative Insurance Co.

Violations were conducted from Sept. 3, 2018, to Sept. 15, 2019.

The decision included the imposition of a number of penalties against these violators, as follows:

First: Khalid bin Nasser bin Abdullah bin Muhaini:

1- A fine worth SAR 520,000.

2- SAR 357.420 to be paid to the CMA account for illegal gains achieved from his investment portfolio.

Second: Haitham bin Fahad bin Mazyad Almazyad:

1- A fine worth SAR 270,000.

2- SAR 59,160 to be paid to the CMA account for the illegal gains achieved from his investment portfolio.

Third: Mish'al bin Abdulrahman bin Muhammad Alruqaeb:

1- A fine of SAR 200,000.

2- SAR 155,100 to be paid to the CMA account for the illegal gains achieved from his investment portfolio.

Fourth: Muhammad bin Abdulrahman bin Muhammad Alruqaeb:

1- A fine of SAR 170,000.

2- SAR 71,450 to be paid to the CMA account for the illegal gains achieved from his investment portfolio.

Fifth: Salma bint Muhana bin Hamad Aljash'ami Alshammari:

1- A SAR 90,000 fine.

2- SAR 44,360 to be paid to the CMA account for the illegal gains achieved from her investment portfolio.

Sixth: Abdulrahman bin Abdulaziz bin Abdulrahman Almane:

1- A fine of SAR 60,000.

2- SAR 9,470 to be paid to the CMA account for the illegal gains achieved from his investment portfolio.

Seventh: Ibrahim bin Muhammad bin Ibrahim Al Othman Altamimi:

1- A SAR 30,000 fine.

2- SAR 3,520 to be paid to the CMA account for the illegal gains achieved from his investment portfolio.

Eighth: Fahad bin Khamis bin Muhammad Al Hudayb:

1- A fine of SAR 40,000.

2- SAR 21,520 to be paid to the CMA account for the illegal gains achieved from his investment portfolio.

Ninth: Ahmad bin Saleh bin Muhammad Alsultan:

1- A fine of SAR 40,000.

2- SAR 8,630 to be paid to the CMA account for the illegal gains achieved from his investment portfolio.

Tenth: Muhammad bin Khamis bin Muhammad Al Hudayb:

1- A fine of SAR 30,000.

2- SAR 44,490 to be paid to the CMA account for the illegal gains achieved from his investment portfolio.

Eleventh: Abdulmohsen bin Abdulaziz bin Abdulrahman Alshuwaiman:

A fine of SAR 50,000.

Twelfth: Ziyad bin Hamad bin Zaid Alswaygh:

A fine of SAR 30,000.

Thirteenth: Faisal bin Abdullah bin Muhammad Bin-Saedan:

A fine of SAR 20,000.

Fourteenth: Talal bin Muhammad bin Salem Alomari:

1- A fine of SAR 10,000 for violating Article (24.a) of the Authorized Persons Regulations.

2- A fine of SAR 390,000 for violating Article (12.c) of the Market Conduct Regulations.

3- Banning him from working in any registration-required positions, investment portfolio management or investment advising for 90 days.

The decision also included obligating a number of investors to pay to the CMA account a total amount of SAR 152,700 for the illegal gains achieved in their investment portfolios that resulted from the violations committed by the convicted persons. This included Khalid bin Nasser bin Abdullah bin Muhaini, Abdulmohsen bin Abdulaziz bin Abdulrahman Alshuwaiman, Ziyad bin Hamad bin Zaid Alswaygh, and Faisal bin Abdullah bin Muhammad Bin-Saedan.

Furthermore, any person affected by these violations in this case is entitled to file a compensation claim (as individual or class action) with the CRSD for the damages suffered due to these violations, provided that such claim is preceded by a complaint filed with the CMA on this regard.

However, the GS-CRSD will announce to the public on its website in case of registering any class action in order to enable the rest of investors affected by such violations to apply to the CRSD to join the class action.