Investigating The Silence: The Failure Of The PSE To Address Trading Irregularities

As the third anniversary of the trading irregularities surrounding the sale of unlisted shares in Abra Mining (AR) approaches, investors are left disillusioned by the lack of legal action from the Philippine Stock Exchange (PSE).

Amidst regulatory silence, investors await accountability as the Philippine Stock Exchange grapples with the aftermath of the Abra Mining trading scandal. | Illustration: Ask

Despite hundreds of investors, including foreign funds, falling victim to the illegal trading of AR, the PSE has remained eerily quiet, and inactive in enforcing trading rules, prompting questions about its effectiveness in regulating the market.

The aftermath of the AR trading scandal has exposed glaring inadequacies within the PSE, raising concerns about its ability to maintain integrity and transparency in the market.

While neighboring bourses like Thailand and Indonesia boast daily trades of $3.4 billion and $1.2 billion respectively, the PSE lags behind with a mere $500 million in trades. This stark contrast underscores the PSE's indifference towards addressing flagrant cases of trading irregularities.

The lack of enforcement has also deterred companies from participating in the PSE program, fearing their listing may lack credibility due to the exchange's inability to uphold the law.

Despite concluding its investigation into the Abra Mining scandal, the PSE has remained tight-lipped about its findings, passing the responsibility to the Securities and Exchange Commission (SEC), which has similarly avoided addressing the issue.

The failure of both the PSE and the SEC to hold Abra Mining officials accountable for the trading irregularities has broader implications for the Philippines' standing on the international stage.

The country's presence on the gray list of the Financial Action Task Force (FATF) is attributed in part to the lack of action against money laundering activities linked to the AR scandal.

The SEC's role within the Anti-Money Laundering Council (AMLC) further highlights the urgency for legal action to avoid blacklisting and financial isolation.

The voice of legal firm MOST has echoed the frustrations of affected investors, urging the PSE to address the Abra Mining scandal. Despite sending a letter to PSE's Honorable Ramon C. Monzon over a year ago, inquiring about the irregularities, the PSE has failed to make any public statements on the matter.

Questions regarding the listing of unapplied AR shares and the involvement of PSE employees in the irregularities remain unanswered, leaving investors in the dark.

As investors await accountability and transparency from the PSE, the silence surrounding the Abra Mining scandal continues to undermine confidence in the Philippine stock market.

The failure to address trading irregularities not only jeopardizes investor trust but also risks further damage to the country's financial reputation on the global stage.

Until concrete actions are taken, the PSE's reputation as an effective regulator remains in question, leaving investors and stakeholders searching for answers in a market plagued by uncertainty.

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