Jordan brokerage fraud investigation

Jordan times

Committee devises action plan for brokerage fraud investigation

Answers sought from gov’t over Shahin extradition costs

by JT | Jan 05, 2012 | 23:03

A Lower House committee on Thursday devised an action plan for its investigation into the widespread fraud committed by several brokerage firms in 2008 (File photo)

AMMAN — The parliamentary committee looking into the brokerage firms that were involved large-scale fraud cases in 2008 on Thursday set up an “extensive” action plan for its investigation.

During a meeting on Thursday, members of the panel, which was formed on December 29 upon a request of 20 deputies, agreed to arrange visits to correctional centres to meet with owners of the brokerage firms who are serving prison terms in connection with fraud cases.

Deputy Basil Ayasrah (Jerash), who heads the committee, was quoted in a Lower House statement sent to The Jordan Times yesterday as saying that the panel will look into all firms that were involved in “market maker” or intellectual property brokerage business.

According to web sources, the term “market maker” refers to a broker-dealer firm that accepts the risk of holding a certain number of shares of a particular security in order to facilitate trading in that security. Each market maker competes for customer order flow by displaying buy and sell quotations for a guaranteed number of shares. Once an order is received, the market maker immediately sells from its own inventory or seeks an offsetting order.

Ayasrah said the panel will also meet with victims of the brokerage firms and will ask the concerned parties to provide the committee with all documents related the case.

A total of 256 brokerage houses were referred to the State Security Court between September 7, 2008 and January 1, 2009, and more than 400,000 complaints were filed against these firms by 117,000 citizens from all walks of life who were affected by the scams.

On Wednesday, Deputy Ali Khalaileh (Zarqa, 2nd District) submitted a memorandum to the House speaker’s office to be sent as a question to the government, inquiring about the costs the state treasury incurred as a result of bringing convicted business tycoon Khalid Shahin back into the country.

Last week, the House tasked its permanent bureau with forming a five-member committee to investigate illegalities in a previous government’s decision to allow Shahin to travel abroad for treatment.

Shahin, who was serving a three-year term in prison for bribery and corruption in a case related to the Jordan Petroleum Refinery Company expansion project, was allowed to leave the country in February on the basis of a joint medical report signed by doctors from the private and public sectors stating that his obesity-related health condition could not be treated in Jordan.

The case triggered public anger and criticism of authorities when a news report claimed that Shahin was seen in London “in good shape”. He then went to Germany, from where he was brought home after extensive diplomatic and legal efforts.Two ministers resigned over the scandal.

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