KATHMANDU, Feb 25: The Securities Board of Nepal (SEBON), by issuing a directive, has prohibited trading of stock owned by the institutions and individuals who are kept in sensitive lists by the United Nations (UN).
In the aftermath of the Financial Action Task Force incorporating Nepal in its greylist, the regulator of the country’s stock exchange has come up with stern measures aiming to curb the circulation of the illegally earned money. Nepal’s stock exchange market has been suspected as the country’s one of the major areas where the earnings made out of money laundering is being injected.
By issuing ‘Guidelines on Targeted Financial Sanctions for Securities Markets Participants,’ the SEBON has directed the security market participants (SMPs) not to carry out shares transactions by the investors who are under the UN’s sanctions lists. Nepal is implementing relevant United Nations Security Council Resolutions on the suppression and combating of terrorism, terrorist financing and countering the financing of proliferation of weapons of mass destruction, in particular relating to targeted financial sanctions.
According to the SEBON, it has enforced the guideline targeting the prevention and suppression of terrorism and terrorist financing, and the prevention, suppression and disruption of proliferation of weapons of mass destruction and its financing. “The SMP must always be wary of the possible use of false identities, dual nationalities, multiple names and identities when performing name searches for each designated person to prevent unintended omissions,” reads the SEBON issued guidelines.
The SEBON has asked the SMPs to freeze all the funds including demat account and listed stocks of the designated suspicious persons within 24 hours and without sending prior notice to the concerned. The sector’s regulator has asked stock exchange, stockbroker, mutual fund manager, specialised fund manager, credit rating agency and the investment company to inform the central depository immediately for a confirmed match.
The regulator has also asked the SMPs to report within three days from taking any freezing, blocking or rejection measure with the designated persons to the SEBON, which will then convey the information to the Money Laundering and Revenue Investigation Division of Office of the Prime Minister and Council of Ministers (OPMCM) within three days of receiving such information, said the SEBON.