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OJK revokes Recapital’s brokerage license after submitting misleading report
The firm was found to have concealed an exchange bond issuance agreement between the firm and PT Nexis Inti Persada in 2016. It also failed to record the receipt of funds from the issuance as liability in the report.
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The Financial Services Authority (OJK) logo is seen at its headquarters in Jakarta. (kontan.co.id/File)
T
he Financial Services Authority (OJK) revoked brokerage firm PT Recapital Sekuritas Indonesia’s license to operate as it was found to have submitted a misleading net adjusted working capital (MKBD) report.
In a letter issued by the authority on Jan. 30, the firm was found to have concealed an exchange bond issuance agreement between the firm and PT Nexis Inti Persada in 2016. It also failed to record the receipt of funds from the issuance as liability in the report. As a result, Recapital Sekuritas’ MKBD value inflated over discrepancies in the report.
The OJK also found that the bond issuance resulted in the firm’s MKBD value to be reduced to below the minimum requirement of Rp 25 billion (US$ 1.82 million), thus meeting the requirement to have its brokerage license revoked.
“Following the revocation, Recapital Sekuritas is prohibited from conducting business as a brokerage dealer and underwriter,” the letter reads. The OJK also fined Recapital Sekuritas Rp 700 million for the violations.
Recapital Sekuritas, part of private equity firm PT Recapital Advisors, was founded by Indonesian Chamber of Commerce and Industry (Kadin) chairman Rosan Roeslani and former vice president hopeful Sandiaga Uno in 1997.
In the meantime, the OJK also imposed a Rp 600 million fine on Recapital Sekuritas president director Abi Hurairah Mochdie for being responsible for the submission of a misleading MKBD report.
The authority also barred Abi from holding a position as a manager, shareholder and a key person, or in charge of companies engaged in the capital market for three years.
“The OJK also revokes [Abi’s] securities company representative license due to the violations,” the authority said in the letter.
Recapital Sekuritas customers who still have shares or bonds in the firm could claim their securities with the Indonesian Central Securities Depository (KSEI). They could also claim their funds with Bank Mandiri, Bank Central Asia (BCA) and Bank CIMB Niaga.
The Indonesia Stock Exchange (IDX) revoked Recapital Sekuritas’ brokerage firm membership on the bourse on Jan. 29, 2018.
