The government, by its unbelievable behaviour falling pray to the whims and fancies of an influential few, a group of shady investors and their crony brokers have all been shamed by one of the biggest chambers in the country.
"The President has been told that the country’s stock exchange had fallen to its recent lows because of the Securities and Exchange Commission (SEC). This was bad for the country they said. The SEC was not patriotic they said. But none of them told the President how so called junk stocks saw phenomenal price increases, how pumping-and-dumping, insider trading and market manipulations were taking place at will. They did not tell the President how brokers were extending credit like nobody’s business," a market analyst said.
The SEC was in the process of investigating all these issues. Naturally, directives were put in place to cool-off an overheated market, with a majority of counters seeing their share prices increase without any fundamental basis. And to-date, 17 cases are at various stages of being investigated.
The market correction and investigations were touted as a bad thing! And now it is obvious that the Presdient and the government have swallowed the bate with respected Chairman of the SEC Thilak Karunaratne planning to resign by the end of this week because like his predecessor Ms. Indrani Sugathadasa, his conscience will not allow him to ‘play ball’.
The Colombo Stock Exchange rose 0.99 percent by mid-day yesterday, up 48.63 points to 4,956.82, and the shameless pack of manipulators were quick to justify that the market was recovering after the troublesome SEC Chairman’s announcement that he would resign.
But the Ceylon Chamber of Commerce, in a short statement, said the turn of events would not be good for the country, rubbing egg on the faces of all those perpetrators who obviously convinced the President otherwise.
"The Ceylon Chamber of Commerce notes with concern the statements made by Thilak Karunaratne, Chairman of the Securities and Exchange Commission (SEC) to the media on his impending resignation. The resignation of two SEC Chairpersons within a period of less than one year will be viewed with concern by investors, corporates and other stakeholders. An effective and stable regulatory framework is critical to ensure a robust and sustainable capital market, which delivers long term value to all stakeholders," the chamber said.
The Chambers statement is obviously watered-down and half hearted, and probably too late, but it is, nonetheless, an indictment on the government, the shady investors and crony brokers who believe the country’s stock exchange does not need regulation, that market offences were an integral part of the system which should not be disturbed.
As highlighted in these pages, a plethora of respected persons, including four broker firms, have stood up in support of the SEC. All they had asked for is equity, justice and that the rule of law prevailed.
But as Treasury Secretary Dr. P. B. Jayasundera told the SEC, political considerations come first. He wanted the SEC to compromise. The SEC refused, and now its Chairman can do nothing but resign.
"Mr. Thilak Karunaratne and Ms. Indrani Sugathadasa showed this country what it means to be decent, honourable citizens, where playing ball with the government did not always mean that it was good for the country. Their actions have put to shame those shamelessly practicing cronyism in this country."