CMA LAW: Announcement regarding issuance of Disciplinary Board Resolution No. (32/2024 Disciplinary Board) (13/2024 Authority) and imposition of a fine against: The Automated Systems Company for violating the rules of Disclosure and Transparency and Corporate Governance

Announcement regarding issuance of Disciplinary Board Resolution No. (32/2024 Disciplinary Board) (13/2024 Authority) and imposition of a fine against: The Automated Systems Company for violating the rules of Disclosure and Transparency and Corporate Governance

For violating the following:
1) The provision of Article (4-2-1) of Module Ten (Disclosure and Transparency) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:
It was proven to the CMA that the Automated Systems Company delayed disclosing a number of material information.

2) The provision of Item (1) of Article (6-3) of Module Fifteen (Corporate Governance) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:

It was proven to the CMA that the Automated Systems Company did not disclose the electronic fraud of …… Company to the Risk Department, and no recommendation or report was issued in this regard by the relevant department, noting that the total value of the fraud is estimated at USD (523,761).

3) The provision of Item (1), (4) of Article (6-8) of Module Fifteen (Corporate Governance) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:

It was proven to the CMA that the Automated Systems Company did not disclose the electronic fraud of …… Company to the Internal Audit Department, and no recommendation or report was issued in this regard by the relevant department, noting that the total value of the fraud is estimated at USD (523,761) (five hundred and thirty-two thousand and seven hundred and sixty-one US Dollars only).

4) The provision of Paragraph (d) of Item (4) of Article (9-9) of Module Fifteen (Corporate Governance) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:

It was proven to the CMA that the Automated Systems Company did not disclose the agreements concluded between the Company and ……. in the associated parties clause at the general assembly to shareholders. Noting that a member of the board of directors of the Automated Systems Company is an associate party in …… Company, as the aforementioned holds the position of Vice Chairman of the Board of Directors and CEO in the……… Company which is a partner of …….. Company.

The Resolution included the infliction of the following penalty: -

“Levying a fine against The Automated Systems Company as follows:

1- The amount of KWD 2000 (two thousand Dinars) for the first attributed violation.

2- The amount of KWD 5000 (five thousand Dinars) for the second and third violations due to correlation.

3- The amount of KWD 5000 (five thousand Dinars) for the four attributed violation to the Company.”

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 rules 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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