The Securities and Exchange Commission of Pakistan has referred Blink Capital Management to the Federal Investigation Agency. The referral concerns alleged investor fraud worth Rs. 446.664 million.
SECP launched an investigation under Section 83 of the Futures Market Act, 2016. The probe followed complaints alleging unauthorized fund collection and promises of fixed returns.
Blink Capital Management operated as a licensed futures broker and market maker for Pakistan Mercantile Exchange Limited. However, investigators found evidence suggesting investors received promises beyond the company’s licensed activities.
Thirty-five complainants reported claims totaling Rs. 446.664 million. Meanwhile, investigators traced Rs. 408.6 million involving 29 complainants through a detailed financial trail.
SECP said substantial funds moved into accounts linked to Blink and its former executives. Some funds also went to accounts connected with employees and associated individuals.
Significant amounts were reportedly withdrawn in cash, according to the investigation.
Investigation Finds Alleged Ponzi-Type Scheme
Investigators found agreements promising predetermined returns between 3.7% monthly and 48% annually. The agreements also included post-dated cheques as security.
Based on available evidence, SECP concluded that Blink allegedly operated a Ponzi-type fraudulent investment scheme. The investigation also identified alleged illegal deposit-taking and unauthorized guaranteed returns.
SECP said the findings indicated possible violations of several laws. These included the Companies Act, 2017, Futures Market Act, 2016, and relevant broker regulations.
SECP Refers Case To FIA For Action
SECP Chairman Dr Kabir Ahmed Sidhu reaffirmed the commission’s commitment to protecting investors. He said authorities would pursue market abusers and entities misusing regulatory status.
Following the findings, SECP approved the referral to FIA under Section 41B. The agency will conduct further investigation and pursue appropriate action under law.
Meanwhile, SECP urged the public to avoid unauthorized investment schemes. The regulator warned against schemes promising fixed or guaranteed returns.
