The Philippine Stock Exchange (PSE) said Tuesday it will initiate the delisting process for Abra Mining and Industrial Corp., after the company and its directors and officers were found to have allegedly engaged in unauthorized and fraudulent trading activities.
The Securities and Exchange Commission (SEC) said over the weekend it imposed P540-million fines against parties involved in the alleged unauthorized and fraudulent trading of unissued shares of Abra Mining covering the period 2015 to 2019.
“With the SEC Markets and Securities Regulation Department’s confirmation that there were indeed illegally issued shares circulating on the market and its resolution revoking AR’s registration statement and corresponding permit to sell securities, the PSE is left with no alternative except to maintain the trading suspension on AR [Abra Mining] shares and proceed with the initiation of delisting proceedings pursuant to its Involuntary Delisting Rules,” the PSE said in a statement Tuesday.
The SEC and PSE started investigating the trading of unissued and unlisted shares of Abra Mining in March 2021. Since then, trading of Abra Mining shares has been suspended.
The PSE said minority stockholders of Abra Mining may, individually or as a group, consult their counsel and seek legal advice on available remedies under existing laws.
Republic Act No. 11765 or the Financial Products and Services Consumer Protection Act (FPSCPA) provides protection to financial consumers against fraudulent practices and provide them with an expeditious remedy for enforcement of claims.
The SEC has authority to adjudicate complaints under FPSCPA such as damages not exceeding P10 million.
The SEC’s Markets and Securities Regulation Department (MSRD) said in a decision promulgated on April 8, 2024 that it found Abra Mining and its directors, officers, transfer agent and certain stockholders guilty of violating Section 26 of Republic Act No. 8799, or The Securities Regulation Code (SRC) and Section 61 of Republic Act No. 11232, or the Revised Corporation Code (RCC).