Securities and Exchange Commission of Pakistan to monitor Ponzi schemes

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has approved the establishment of a Corporate Intelligence Unit (CIU) to detect registered companies suspected of operating Ponzi or pyramid schemes, lending without a license, or exceeding their permitted objectives. The unit will monitor publicly available information, such as news reports, social media and digital advertising, to identify potential infringements before complaints are filed.

Confirmed leads will be forwarded to the relevant SECP departments for investigation or enforcement action. When applicable, this information may also be shared with agencies like the Federal Investigation Agency, National Cyber Crime Investigation Agency, State Bank of Pakistan and National Accountability Bureau. The CIU aims to enhance the SECP's early-warning capabilities, facilitate rapid regulatory action, and deter further investor losses by tracking patterns and linking data from various public sources.

By converting open-source information into actionable regulatory leads, the CIU will bolster the commission's risk-based surveillance, allowing it to target emerging risks more effectively. Dr Kabir, SECP Chairman, stated that the CIU will strengthen the commission's surveillance by transforming publicly available information into verified regulatory leads, as mandated under Section 20 of the SECP Act 1997 and part of the Chairman's Secretariat.