Pakistan Secures First Insider Trading Conviction: Habib Metro Bank AVP Found Guilty

By Manik Aftab ⏐ 8 months ago ⏐

2 min read

Sindh Court Hands Down Pakistans First Insider Trading Conviction

KARACHI: (Updated) In a historic judgment, the Sindh Special Court (Offences in Banks) has issued the first-ever insider trading conviction in Pakistan in a case filed by the Securities and Exchange Commission of Pakistan (SECP).

The court found Zakir Hussain Somji, Assistant Vice President – Investments at Habib Metropolitan Bank Limited (HMB), guilty of insider trading in violation of Section 128 of the Securities Act, 2015.

SECP Chairman Akif Saeed praised the outcome, stating that the ruling will strengthen investor confidence in Pakistan’s capital markets and support long-term capital formation. He expressed hope that the verdict will serve as a precedent for pending cases and ongoing investigations involving insider trading in Pakistan.

The case stemmed from SECP’s detailed review of suspicious trades flagged through the Karachi Automated Trading System (KATS), covering the period from January 1, 2014, to February 2, 2016. Investigations revealed that Somji misused insider information regarding HMB’s investment decisions to earn personal profits.

Details of Unlawful Share Transactions

The accused purchased 11,795,100 shares in various companies, including 1,230,900 shares (10.43%) acquired from HMB, and sold 11,836,600 shares—of which 4,915,200 (41.52%) were sold back to HMB—netting unlawful gains of Rs2,866,646.

SECP filed a formal complaint under Section 128, punishable under Section 159 of the Securities Act, 2015. Following a full trial and arguments by SECP’s Special Public Prosecutors and the defense, the court delivered its verdict on June 14, 2025.

The accused was convicted and fined Rs8,599,938—three times the illegal profit—with payment due within seven days. Failure to comply will result in imprisonment until full recovery of the amount.

The landmark insider trading conviction comes nearly six months after SECP identified as many as 37 registered businesses involved in illegal financial activities in Pakistan.

Official Statement by Habib Metropolitan Bank Regarding Insider Trading Case

Habib Metropolitan Bank has issued an official statement regarding the inside trading case as follows:

“This is with reference to the insider trading case related to events that occurred between January 2014 and February 2016, involving Mr. Zakir Hussain Somji, a former employee of Habib Metropolitan Bank Limited.

Almost a decade ago, Mr. Somji misused the Bank’s equity decisions purely in an individual capacity for his personal gains. Upon identifying irregularities through a comprehensive internal monitoring process, the Bank terminated Mr. Somji’s employment.”

Habib Metropolitan Bank, insider trading, SECP

Manik Aftab

Manik Aftab is a writer for TechJuice, focusing on the intersections of education, finance, and broader social developments. He analyzes how technology is reshaping these critical sectors across Pakistan.