SECZ suspends stockbroker over possible abuse of client securities

 SECZ suspends stockbroker over possible abuse of client securities
Published: 11 October 2019
The Securities and Exchange Commission of Zimbabwe has suspended stockbroker Benson Gasura to pave way for investigations into possible non-compliance with the regulator's directive on nominee accounts.

The suspension is for a period of six months.

In 2012, SECZ issued a directive compelling stockbrokers to register shares from nominee accounts into individual accounts. This was necessitated by the need to get rid of gross irregularities showing through inconsistent records, low levels of capitalisation, insufficient insurance cover, and high incidence of scrip frauds and abuse of clients’ securities.

That time only one stockbroking firm, Mast Stockbrokers, was suspended for non-compliance.

But now it has emerged that there is alleged non-compliance following a complaint by a client over the sale of shares by the stockbroker, which would be tantamount to fraud but because its being said that the client had an open position with the firm, it might conclude as being non-compliant with a SECZ directive.

It has also been established that the company was sitting on 700 share certificates, which they recently lodged with the IPF as unclaimed.

In a notice to transfer secretaries, SECZ said in order to facilitate investigations, Gasura is prohibited from carrying out any licensable activities from October 7, 2019 for a period of six months, unless revoked by SECZ.

To facilitate the investigation, PFK Chartered Accountants will conduct the forensic audit until the investigation is complete.

Efforts to get comment from Gasura were futile.
- finx
Tags: SECZ,


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