CMA LAW: Announcement regarding issuance of Disciplinary Board Resolution No. (99/2022 Disciplinary Board) (76/2022 Authority) and imposition of a fine against National Investments Company for violating the rules of Module Sixteen of the Executive Bylaws of Law No. 7 of 2010 and their amendments

Announcement regarding issuance of Disciplinary Board Resolution No. (99/2022 Disciplinary Board) (76/2022 Authority) and imposition of a fine against National Investments Company.

For violating the rules of Module Sixteen of the Executive Bylaws of Law No. 7 of 2010 and their amendments.

For the following reasons:

The Company violated the following provisions: Item (2) of Article (3-19) of Module Sixteen of the Executive Bylaws of Law No. 7 of 2010 and their amendments due to the Company’s repetitive failure to perform enhanced due diligence on high risk clients; Article (3-20) of the same Module which was proven through the revision of the policies and procedures manual submitted by the Company and its KYC form that its system does not identify whether a client, potential client or a beneficial owner is a Politically Exposed Person (PEP); Article (3-37) of the same Module which was proven through the Company’s failure to ensure the consistency of the executed transactions of some of its clients with the information it received in regards with their business and the source of their funds; Article (4-1) of the same Module which was proven through the Company’s repetitive failure to update some of the clients’ data; Article (4-7) of the same Module which was proven through the Company’s failure to keep all CDD records, account files and business correspondence for the specified period (five years after the account is closed).
Provided that these violations are procedural and not substantive.

The Resolution included the infliction of the following penalty: -

"Levying a fine against National Investments Company in an amount of KWD 2000 (two thousand Dinars) for each of the attributed violations.”

In this regard, the CMA emphasizes the implementation of CMA Law and its Executive Bylaws on all persons dealing in securities activities, and urges them to comply with these Laws in order to promote investors' confidence, create a sound investment environment, and implement the Law according to the principles of fairness, transparency, and integrity in line with the best international practice.

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