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 complained that officials at the broking firm had persuaded him not to liquidate and hold on for a few more months and that his account had been subjected to 'churning' (repeated trading conducted to earn commission).
The stock exchange had ruled that the client be compensated for losses made on credit without his authority.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.