DW Capital faces SEC probe for P2.6B in 'unauthorized' trades
MANILA, Philippines – The Securities and Exchange Commission (SEC) is set to investigate brokerage firm DW Capital Incorporated (DWCI), which allegedly engaged in unauthorized trading of securities worth P2.6 billion.
In a statement, the SEC said it will launch a probe into DWCI after Capital Markets Integrity Corporation (CMIC), the watchdog unit of the Philippine Stock Exchange (PSE), sought the corporate regulator's nod to take over DWCI.
In a subpoena issued against DWCI, the SEC ordered the brokerage firm to show various records that would establish its financial condition.
These records include DWCI's customer master list; stock position report detailed per customer, per stock, per location; portfolio reports; transaction reports; account ledgers; statement of accounts; confirmation invoices; and customer account information forms, among others.
The SEC also scheduled a clarificatory hearing on Tuesday, August 29.
SEC sources said DWCI officials have expressed willingness to submit the required documents.
Last August 10, the PSE issued a memorandum that placed DWCI under preventive suspension.
The PSE issued the preventive suspension order after lawyers of DWCI's clients asked the CMIC to prohibit DWCI from trading their clients' shares of stock, and to direct the brokerage firm to preserve the records of transactions pertaining to subject securities.
DWCI clients also reported to CMIC that there are shares of stock that have not been delivered by the brokerage firm to them. These clients are demanding the immediate delivery of these securities.
Under the Securities Regulation Code, the SEC, upon verified complaint by any party, may order an exchange or a self regulatory organization (SRO) to take over the operation of a failed trading participant for the purpose of preserving and protecting the failed trading participant's books, records, customer accounts, and trade-related assets.
CMIC is an SRO and the primary regulator of the trading participants of the PSE. – Rappler.com