Authorities have recently punished a number of individuals and organisations for violating regulations in securities transactions, but analysts say the penalties haven't been strict enough.
Investors were eager when the State Securities Commission (SSC) first issued a decision to punish an investor in HCM City in late June with a fine of VND30mil (US$1,875) for entering into collusion to distort supply and demand on the market.
Less than a month later, two other individuals in the city were fined VND60mil ($3,750) and VND100mil ($6,250) for similar acts.
Among organisations, the Vietcombank, BIDV and Sai Gon Securities companies have were each fined VND10-20mil ($625-$1,250) for breaking securities management (i.e., registration, deposit, or payment) and reporting regulations.
Foreign companies were no exception. Indochina Capital was fined VND10mil for not conforming with regulations on internal transactions.
On July 25, the SSC slapped the Thien Viet Securities Co a VND50mil ($3,125) fine for its delay in publicising a change in its general director position.
On Monday, it announced a VND20mil ($1,250) fine on the Ba Ria-Vung Tau Housing Development Co for failure to make timely disclosures.
The SSC has taken great strides to make the market more transparent. However, the penalties it has issued so far have been too lightweight to have a real impact on investors, according to analysts, especially major players for whom a minor fine is mere chicken feed.
"The heaviest penalty for breaking securities laws or regulations is now only VND50mil. It's not a reasonable level," said SSC chief inspector Hoang Duc Long.
The commission is asking the Government to consider stricter penalty levels, he said, with some serious violations even subject to penal liability.
Authorities, meanwhile, face challenges in discovering all violations, Long said.
"In order to detect a lawbreaker, we have to check over 250,000 accounts on the market, and we only have about 20 inspectors," said Long.
"There have also been cases in which auditors have released inaccurate information or even colluded with enterprises to falsify reports. It's really a big concern."
Source: VNS
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