The Securities and Exchange Commission of Pakistan (SECP) has approved sending a reference to the Federal Investigation Agency (FIA) in the Bagsara Securities case, involving unpaid investor claims that have remained outstanding for 16 years.
Claims worth Rs. 48.9 million remain outstanding, leaving investors awaiting payment even after 16 years. The SECP said the purpose of the reference is to advance the recovery of outstanding amounts owed to investors.
An inquiry found that investors’ shares were transferred and pledged without their consent. Between 2007 and 2010, shares worth more than Rs. 176.2 million belonging to customers were pledged, according to the inquiry report.
Banks and the stock exchange later sold the pledged shares after payments were not made against them.
The inquiry identified 333 investors with verified claims totaling Rs. 145.5 million. Of this amount, Rs. 96.57 million has already been paid to investors.
Bagasra Securities (Private) Limited was a corporate member of the Karachi Stock Exchange and registered with the SECP as a broker. The company was declared a defaulter by the Karachi Stock Exchange in November 2008 after failing to settle a final loss of about Rs. 51.4 million, following which its membership card was put up for auction. The SECP had also initiated enforcement proceedings against Bagasra in 2007 over violations of futures trading regulations.
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