SECP chief accused of illegal salary increases, Rs14bn irregularities
Tariq Khattak
LAHORE (Sept 13):Lahore High Court Justice Ahmad Nadeem Arshad has directed the Federal Ministry of Finance to decide on SECP Chairman Akif Saeed’s dismissal petition following allegations of unauthorized salary increases and Rs14 billion financial irregularities.
The public interest petition filed by Muhammad Rafiq through lawyer Mian Muhammad Aslam seeks the removal of the Securities and Exchange Commission of Pakistan chairman for allegedly exceeding his legal authority. The case centers on claims that Saeed unilaterally increased his salary and benefits without proper authorization. At the same time, Auditor General’s report revealed massive irregularities within the regulatory body.
Justice Arshad heard arguments from the petitioner’s counsel, who presented evidence of systemic financial mismanagement at SECP. The lawyer argued that recent audits uncovered Rs14 billion in financial irregularities during Saeed’s tenure as chairman. These findings allegedly point to broader governance failures within Pakistan’s premier capital markets regulator.
The petition challenges Saeed’s decision to raise his own compensation package without seeking approval from relevant authorities. Recent media reports revealed the SECP chief’s annual pay package reached Rs41 million, prompting legislative shock and subsequent moves to curtail the salary powers of regulatory heads. Legal experts note that SECP’s governing framework does not grant the chairman unilateral authority to modify his remuneration structure. The petitioner contends this action represents a clear abuse of office and a violation of established protocols governing executive compensation in regulatory bodies. The unauthorized increases allegedly benefited multiple commissioners, including Abdul Rehman Warraich, and Executive Directors, including Asif Jalal Bhatti. The evidence is showing a pattern of backdated salary adjustments across SECP’s senior leadership structure.
This procedural move places the sensitive matter within the executive branch’s purview while maintaining judicial oversight. The ministry now bears responsibility for conducting its own review of the allegations and determining appropriate action. This decision could potentially disrupt SECP’s operations and decision-making processes, impacting its ability to carry out its regulatory functions.
The case highlights growing scrutiny of governance practices within Pakistan’s financial regulatory institutions. SECP oversees the country’s capital markets, corporate sector, and insurance industry, making leadership accountability crucial for maintaining investor confidence. Any disruption in the commission’s leadership could impact regulatory decision-making and market stability.
Financial sector stakeholders are closely monitoring developments given SECP’s role in implementing critical market reforms. The ongoing investigation and the potential for a leadership vacuum could delay the implementation of these measures or create regulatory policy gaps, impacting the stability and development of Pakistan’s financial markets.
The Rs14 billion irregularities figure represents a significant portion of SECP’s operational budget and raises questions about internal financial controls. If substantiated, these findings could necessitate comprehensive reforms to the commission’s financial management systems and oversight mechanisms, to prevent similar irregularities in the future and restore investor confidence in SECP’s financial management.
Market participants and corporate sector representatives are awaiting clarity on the matter. Any prolonged leadership vacuum could hamper the commission’s ability to address pressing regulatory issues.
The Federal Ministry of Finance has not indicated a timeline for its decision on the dismissal petition. The ministry’s ruling will determine whether Saeed continues in his role or faces removal. This outcome will likely set precedents for accountability standards within the country’s regulatory institutional framework.
