THE Capital Markets Integrity Corp. (CMIC) will release verified shares to eligible customers of Equitiworld Securities, Inc. after securing approval from the Securities and Exchange Commission (SEC).
CMIC, the market regulation arm of the Philippine Stock Exchange (PSE), said it had secured approval from the SEC to release shares to the affected customers, according to a memorandum dated June 9.
CMIC said it had identified several securities that are not subject to any ongoing investigation and recommended their release ahead of the approval of the allocation and liquidation of Equitiworld’s trade-related assets.
“CMIC is in the process of informing the clients who have intact shares of this development. These customers may finally transfer the identified intact shares to their preferred trading participants,” CMIC said.
However, the release of intact shares is without prejudice to the approval of the allocation and liquidation of Equitiworld’s trade-related assets; the release of other assets; submission of claims to the Securities Investor Protection Fund; and the pursuit of further legal remedies, the regulator said.
In November, the SEC directed CMIC to take over Equitiworld’s operations, saying the brokerage was no longer in a financial position to meet customer demands for the delivery of securities and payment of sales proceeds.
CMIC found a material discrepancy between the shares reflected in Equitiworld’s stock position report and its business partner portfolio report, totaling 154.91 million shares valued at P46.14 million.
It also uncovered a discrepancy in Equitiworld’s reporting of its cash-on-hand account.
As of end-June 2024, Equitiworld’s risk-based capital adequacy ratio (CAR) report showed zero cash on hand, while its system-generated trial balance reflected cash on hand worth P23.57 million.
CMIC imposed an involuntary suspension on Equitiworld in July 2023 due to compliance issues. — Revin Mikhael D. Ochave
