CmaBoardReleases
Title: Announcement Regarding Issuance of Disciplinary Board Resolution No. (49/2021 Disciplinary Board) (46/2021 Authority) and imposition of a fine of (5) thousand Dinars against KIC Financial Brokerage Company WASATA for violating Module Four (Securities Exchanges and Clearing Agencies) and Module Eight (Conduct of Business)
Announcement Regarding Issuance of Disciplinary Board Resolution No. (49/2021 Disciplinary Board) (46/2021 Authority) and imposition of a fine of (5) thousand Dinars against KIC Financial Brokerage Company WASATA for violating Module Four (Securities Exchanges and Clearing Agencies) and Module Eight (Conduct of Business)
For the following reasons:
- Provision of Article (2-5-3) of Module Four (Securities Exchanges and Clearing Agencies) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:
The Company did not comply with Article (5-4-1-2) of the Rulebook issued by Kuwait Clearing Company. It was revealed to the CMA that the Company continued executing transactions of buying securities of several Heirs Accounts.
- Provision of Item (5) of Article (1-4) of Module Eight (Conduct of Business) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:
The contracts and agreements signed with the clients did not include the procedures that need to be followed in case of any error committed while executing the client’s orders, and mechanism for resolving such an error and the person responsible for such error.
- Provision of Item (i) of Article (5-11) of Module Eight (Conduct of Business) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:
The notifications sent to the clients regarding the execution of any purchase or sale of a security did not include the mechanism of executing the deal, whether through a written order, phone call or an electronic mail. - Provision of Article (6-5) of Module Eight (Conduct of Business) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:
The Company failed to maintain telephone conversations of receiving the clients’ orders regarding buying and selling securities.
- Provision of Article (6-8) of Module Eight (Conduct of Business) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:
Some of the Company’s employees registered in the position of a representative of a Securities Broker Registered with an Exchange failed to introduce themselves when receiving telephone calls from the clients, confirm the clients’ identity, and specify the name of security.
The Resolution included the infliction of the following penalty: -
“The violating Company is fined an amount of one 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.