Real estate firm, 24 investors fined by CMA

Logo of The Capital Market Authority (CMA)

The Capital Market Authority (CMA) said the Appeal Committee for Resolution of Securities Disputes (ACRSD) has issued two final resolutions against 24 investors and a real estate company.

The decisions included fining 23 investors of violating Article (49.a) of the Capital Market Law and Article (2.a) of the Market Conduct Regulations; and one investor and a real estate company violating Article (31) of the Capital Market Law as well as Article (5) of the Securities Business Regulations.

The second definitive decision included the conviction of both Bandar Al-Ghamdi and Bandar Abdulrahman Hamdan Al-Ghamdi Real Estate Co. for violating Article 31 of the Capital Market Law and Article 5 of the Securities Business Regulations.

This was for jointly practicing securities management business activity, through the establishment and operation of Real Estate Investment Funds (REIFs). Furthermore, Bandar Al-Ghamdi was convicted of violating Article 17 of the Securities Business Regulations for advertising this activity on his personal account via the X platform, without obtaining a CMA license.

The convicted individuals and real estate firm were fined more than SAR 2.7 million. Further, those convicted in the first decision, along with another female investor, were obligated to pay more than SAR 1.2 million against illegal gains derived from those violations, the Saudi market regulator said in a statement.

The CMA said that the ACRSD’s final resolutions came as a result of joint coordination and cooperation between the CMA and relevant authorities, following a public penal lawsuit filed by the Public Prosecution, referred to it by the CMA, against the investors for violating the Capital Market Law.

Any person affected by these violations addressed in the first resolution is entitled to file a compensation claim against the convicted persons (as an individual or a class action) with the Committee for Resolution of Securities Disputes (CRSD) for the damage suffered due to these violations.

In addition, any person who has entered into an agreement or contract with the convicted person and entity in relation to the violation addressed in the second final decision is entitled to file a claim (as an individual or a class action) with the CRSD to request the rescission of the agreement or contract and the recovery of any money or other property paid or transferred under the agreement or contract.