Proposal to sharply increase penalties for violations of securities and corporate bonds

ANTD.VN - The Ministry of Finance proposed to increase sanctions against violations of securities and the stock market.

The Ministry of Finance is seeking comments on the draft Decree amending and supplementing a number of articles of Decree No. 156/2020/ND-CP regulating administrative sanctions for violations in the field of securities and the securities market, Decree No. 128/2021/ND-CP amending and supplementing Decree No. 156/2020/ND-CP, Decree No. 158/2020/ND-CP on derivative securities and the derivative securities market.

One of the important contents is that the Ministry of Finance proposes to increase sanctions for violations of securities and the securities market.

Need to increase penalties for violations of private bond issuance

Specifically, increase the fine level for violations that risk affecting the operations of securities trading organizations or the interests of investors such as: violations of private offerings, violations of margin trading, and violations by securities practitioners.

Increase fines and add sanctions for violations of securities business licenses, business activities, and services that must be reported and approved before implementation to increase deterrence and ensure management of activities of securities companies and fund management companies that require approval and licensing from the State Securities Commission.

Increase the additional penalty by increasing the suspension period for certain acts such as lending accounts leading to manipulation (the suspension period is increased to the maximum level in administrative sanctions), violations of reporting when violating transactions of major shareholders, insiders, and related persons with large volumes, (the suspension period is increased to the maximum level in administrative sanctions for violations with a value of VND 10 billion or more);

Add a strong form of temporary suspension of securities brokerage activities for acts of abusing customers' assets such as lending money, securities in customers' accounts, using customers' securities as collateral, and performing services specified in Point b, Clause 1, Article 86 of the Securities Law without written approval from the State Securities Commission.

The Ministry of Finance also proposed to separate violations of individual corporate bonds into a separate section to prescribe behaviors and sanctions appropriate to the obligations, nature, and level of violations because individual bonds have characteristics and regulations different from those of individual stocks and public securities. The provision of services on individual bonds also has different regulations than those on the provision of securities services under the Law on Securities.

At the same time, add specific acts of violations in the activities of offering, disclosing information, registering transactions, and providing services related to individual corporate bonds.

Accordingly, the highest penalty applied to violations of private bond issuance will increase from the current VND1-1.5 billion to VND2-2.5 billion, applied to the following violations: falsifying documents, confirming on fake documents proving eligibility for offering, issuance in the offering registration dossier, issuing shares, convertible bonds, bonds with individual warrants.

Details of the draft Decree here.

Source: https://www.anninhthudo.vn/de-xuat-tang-manh-muc-phat-voi-cac-vi-pham-ve-chung-khoan-trai-phieu-doanh-nghiep-post607206.antd