Saudi CMA Issues Fines and Suspends Investors for Market Manipulation
The Saudi Capital Market Authority (CMA) fined 24 investors and a real estate company nearly $1 million for breaches of capital market laws. These penalties stemmed from multiple cases involving violations of market regulations.
Details of Violations and Penalties
The CMA’s Appeals Committee for Securities Disputes finalized rulings coordinated with government bodies, following criminal cases initiated by the Public Prosecution after thorough investigations.
- In one major case, 23 investors were found guilty of manipulating stock and fund prices between March 2021 and August 2022.
- The manipulation involved placing synchronized buy and sell orders to create a false appearance of market activity.
- These investors were fined a total of SAR 1 million (approximately US$270,000), prohibited from trading for one year, and ordered to return SAR 1.21 million (around US$320,000) in illegal profits.
- The violations breached Paragraph (a) of Article 49 of the Capital Market Law and Paragraph (a) of Article 2 of the Market Conduct Regulations.
Additionally, one other investor was separately ordered to pay back SAR 74,900 (approximately US$19,970) in illicit earnings related to similar infringements.
Unauthorized Securities Business
Another ruling declared that Bandar bin Abdulrahman bin Hamdan Al-Ghamdi and Bandar Abdulrahman Hamdan Al-Ghamdi Real Estate Company conducted securities business without the necessary authorization, resulting in guilty status.
“The rulings were issued in coordination with relevant government entities and based on criminal cases filed by the Public Prosecution following its own investigations.”
These decisions reinforce the CMA’s commitment to maintaining transparency and integrity in the Saudi capital markets.
Author’s summary: Saudi Arabia’s CMA imposed substantial fines and trading bans on investors and a real estate company for orchestrating stock price manipulation and conducting unauthorized securities activities.