Dec 02, 2012 (LBO) – A Sri Lankan stock broking firm has compensated a client who complained to the Colombo Stock Exchange alleging unauthorized trading which led to massive losses during a collapsed stock market bubble. Taprobane Securities, chief executive had earlier been removed by the regulator following a controversial deal involving the attempted sale of a finance company stock to state-run National Savings Bank at an inflated price.
Sri Lanka’s stocks rose up to late 2011 amid a massive credit bubble fired by excess liquidity in money markets but later collapsed in a balance of payments crises.
Taprobane Securities Ltd has paid back a client 3.4 million rupees following a ruling by the dispute resolution panel of the Colombo bourse, after he alleged losses of up to 10 million rupees.
The client alleged that his broker had leveraged his portfolio traded with credit without authority in 2011 while he was away from the country and had delayed a request made upon his return to liquidate the portfolio for several months.
He alleged that he had then been assigned another broker by Taprobane Securities who had been barred from trading earlier by the Securities and Exchange Commission.
He had com