Experts Welcome Saudi Push to Keep Capital Markets Fair, Honest

Saudi Arabia’s Public Prosecution has hammered home the message to traders that it is against the law to create a false or misleading impression of the capital market. In a post on Twitter, the government agency reiterated that all transactions must be fair and honest. The move was welcomed by financial experts in the Kingdom, who said the regulations and policing of the capital markets would have wider economic benefits for the country.

Talat Zaki Hafiz, Saudi economist and financial analyst, told Arab News that directives such as this go hand in hand with initiatives by the Capital Market Authority (CMA) to make sure traders do any act or engage in any action which creates a false or misleading impression to the market. “I believe that the directives will ensure that our stock market is free from any misconduct and illegal behavior as well as false trading,” he said. 

The directives will ensure that our stock market is free from any misconduct and illegal behavior as well as false trading. Dr. Majed Al-Hedayan, a financial and legal expert, told Arab News the directive from the Public Prosecution would help to create “strong capital markets” and would reflect positively on the wider economy, help to attract increased foreign direct investment into the Kingdom, and “strengthen the standards of business investments in this field.”

The Public Prosecution noted that the following actions were fraudulent: Engaging in any action or behavior aimed at creating a false or misleading impression or indicating active trading on a specific security, which is contrary to the truth; performing a series of transactions on a specific security to influence a particular stock; conducting a series of trades on a specific security, such as buying and/or selling a security, with the aim of price stabilization.