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Stiffer penalties in new Securities Act

By Carla Bridglal carla.bridglal@trinidadexpress.com

The new Securities Industries Act will include increased penalties for several new offences, including making directors, senior officers and auditors liable for misrepresenting information to the public.

Increased penalties include increased fines and prison terms, and the introduction of a policy of the disgorgement of profits (being forced to give up profits gained through illegal means).

Making his presentation during the debate of the bill in the Senate yesterday, Trade Minister Vasant Bharath said the aim of the Act was to create a fair capital market through improved disclosure in order to attract local and foreign investors.

Bharath noted that the current legislation was over a decade old, and the new bill sought to address the adequacy of penalties as a deterrent, solidifying the powers of the Securities and Exchange Commission by including new offences and increasing the penalties to existing ones.

Bharath said the Joint Select Committee of Parliament to review the bill proposed increases in custodial sentences as follows: from six months to two years for the disclosure of confidential information; for a person who fraudulently engages in market activities, including purporting be a registered dealer or investment adviser or underwriter an increase from two years to five years; and insider trading from five years to seven years.

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