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Saturday , December 3 2022

Freeze on few brokers funds

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KUWAIT CITY, Oct 31: According to investment sources, the process of updating the data of the clients of brokerage companies operating in the Kuwait Stock Exchange who hold dormant trading accounts or those whose data is required to be updated suddenly based on the directives of the regulatory authorities has resulted in the freezing of the funds of a number of dealers and operators of private financial portfolios for more than a year without being able to obtain the result of the sales they executed on the shares they previously owned, reports Al-Rai daily. The sources explained that the authorities concerned with the money market system, including the Kuwait Clearing Company, ask brokerage firms to update the data of dormant account holders periodically during periods ranging from six months to a year. This is aimed to determine the accuracy of the information in anticipation of errors or violations that endanger the system. However, sudden requests to update the statements of many accounts, despite their valid reasons, caused a crisis for a not small segment of investors, specifically those who were unable to come to the headquarters of brokerage firms in the stock exchange for reasons related to travel, illness or others.

There are thousands of accounts, whether dormant or those affected by sudden update requests, that contain amounts and assets worth millions of dinars, but they are now frozen. Some citizens who own trading accounts and have been outside the country since before the COVID- 19 pandemic have not been able to trade online. They have also been accustomed to this for many years, due to the failure to update their data, as the responsible authorities require the presence of the trader in person to provide such data that does not bear anything new, since he had previously written and signed the validity of it. Those affected have demanded the necessity of solving the problem they are facing so that they can reactivate their accounts or receive their frozen funds. Brokerage companies are exposed to several challenges in light of their responsibility to follow up the update and communicate with customers who express their dissatisfaction with this matter.