SEC compounds yet another offence, Ambani fined Rs 3.3 million
The Securities and Exchange Commission announced last week that it had compounded the offence of market/price manipulation by Dinesh J. Ambani and Metropolitan Office Ltd.
A statement issued by the SEC Director General Channa de Silva said Ambani and Metropolitan Office Ltd had each paid a fine of Rs 3.3 million and that in terms of the SEC Act, compounding does not entail a finding of guilt.
Ambani and Metropolitan denied the charge and asked the SEC to compound the offence.
The statement said the SEC, under powers vested in it under the provisions of the Securities and Exchange Commission of Sri Lanka Act No. 36 of 1987 (as amended), conducted an investigation into certain trades in the shares of Metropolitan Resource Holdings Ltd. executed by Dinesh J. Ambani of 30/4, Ward Place, Colombo 7 and M/s. Metropolitan Office (Pvt) Ltd. of 85, Braybrooke Place, Colombo 2.
This was in order to ascertain whether these trades amounted to market/price manipulation in terms of Rule 12 in Gazette bearing No. 1215/2 and dated 18th December 2001, the statement said.
“Since the evidence elicited during the course of the investigation suggested that through the execution of the above trades, Mr. Dinesh J. Ambani and M/s. Metropolitan Office (Pvt) Ltd., had committed the offence of Market/Price Manipulation, Notice of Action was issued to them on 10th February 2005,” it said. Consequent to the Notice of Action being issued to Dinesh J. Ambani and M/s. Metropolitan Office (Pvt) Ltd., and action being filed against the said parties on the charge of market/price manipulation, the SEC received a written communication dated June 8, 2005 from the Attorney-at-Law acting for the parties concerned. This was to inform the SEC that the trades in question had been carried out by them without any intention whatsoever of manipulating the market/price with respect to any share, and requesting the SEC to compound the offence in terms of the provision in the SEC Act, the SEC statement said.
The Commission at a meeting held on June 8, 2005, having considered the circumstances in which the offence is alleged to have been committed, decided to compound the said offence in terms of Section 51A of the SEC Act for a sum of Rs 3.3 million being paid to the SEC by each of the said parties, Dinesh J. Ambani and M/s. Metropolitan Office (Pvt) Ltd.
The aforesaid sums of Rs 3.3 million were paid by Mr. Dinesh J. Ambani and M/s. Metropolitan Office (Pvt) Ltd. on August 5, 2005 and the offence compounded by the SEC.
The aforesaid sums have since been credited to the Compensation Fund established under the SEC Act.

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