Title: Announcement regarding issuance of Disciplinary Board Resolution No. (26/2024 Disciplinary Board) (15/2024 Authority) and imposition of a fine against Coast Investment and Development Company for violating the rules of Clients’ Funds and Clients’ Assets and the provisions of Module Sixteen of the Executive Bylaws of Law No. 7 of 2010 and their amendments

Announcement regarding issuance of Disciplinary Board Resolution No. (26/2024 Disciplinary Board) (15/2024 Authority) and imposition of a fine against Coast Investment and Development Company for violating the rules of Clients’ Funds and Clients’ Assets and the provisions of Module Sixteen of the Executive Bylaws of Law No. 7 of 2010 and their amendments.

For the following reasons:
1) The provision of Item (2) of Article (2-2) of Module Seven (Clients’ Funds and Clients’ Assets) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:
2) The provision of Item (5) of Article (3-5) of Module Sixteen of the Executive Bylaws of Law No. 7 of 2010 and their amendments:

The Company failed to comply with the regulatory requirements of maintaining the clients’ funds and assets due to its execution of a total of 22 cash transfers from the cash balance available in a portfolio in a total value of KWD 818,500 (eight hundred and eighteen thousand, and five hundred Kuwaiti Dinars) during 2022 and 2023, even though it is not the beneficial owner of the account.

The Company also failed take due diligence measures to ensure that the bank account of the portfolio is the bank account of the company (beneficial owner), which resulted in the company’s execution of several cash transfers from the client’s portfolio to the account of (one of the partners) during 2022 and 2023, noting that this violation is procedural and not substantive.

The Resolution included the infliction of the following penalty: -
"Levying a fine against Coast Investment and Development Company in an amount of KWD 2000 (two thousand Dinars) for the attributed violation in its two parts.”

In this regard, the CMA emphasizes the implementation of CMA Law and its Executive Bylaws on all persons dealing in securities activities, and urges them to comply with these Laws in order to promote investors' confidence, create a sound investment environment, and implement the Law according to the principles of fairness, transparency, and integrity in line with the best international practice.