Companies Violating Modaraba Regulations to Face Heavy Penalties

The Securities and Exchange Commission of Pakistan (SECP) has decided to heavily penalize Modarba companies, which will deliberately violate any of the provisions of the Modaraba Regulations, 2021. The SECP has issued draft amendments to the Modaraba Regulations, 2021 through a notification issued here on Friday. Under the new regulations, a penalty of Rs. 100,000 would be imposed on each Modarba company involved in the violation of the Modaraba Regulations, 2021. According to the revised regulations, if any person refuses or fails to furnish/file any document, return or information which he is required to furnish by or under these regulations; or refuses or fails to comply with any condition(s) imposed under these regulations; or contravenes or otherwise fails to comply with any provision of these regulations, the SECP Registrar, may, after giving the person an opportunity of being heard, impose such penalty which may extend to Rs. 100,000 and, where the contravention is a continuing one, with a further penalty which may extend to Rs. 1000 for every day after the first during which such contravention continues. Any person aggrieved by an order passed may, within thirty days of such order, prefer an appeal to the Commission, SECP added.