A Centralized Customers Protection Compensation Fund (CCPF), formerly known as Investor Protection Fund (IPF), has been established and operated in accordance with the Customers Compensation Fund (Establishment and Operations) Rules, 2017 and Centralized Customer Protection Compensation Fund Regulations, 2017 promulgated by the Securities and Exchange Commission of Pakistan.

The sole mandate of CCPF is to compensate customers of a defaulter stock-broker up to a maximum of PKR 500,000 per claimant whose claim has been admitted by the Pakistan Stock Exchange (PSX).

The Claim invitation process initiates upon declaration of the stock-broker as defaulter by PSX. A customer wishing to file a claim against the defaulter stock-broker can do so by contacting the Regulatory Affairs Division (RAD) of PSX. The ensuing process is as follows:

  • The Default Committee is constituted by RAD comprising industry experts, senior management personnel of PSX and TREC Holders not exceeding one-third of total such committee members.
  • A notice of default of a stock-broker is issued by PSX on its website informing the public about the declaration of a stock-broker as a defaulter.
  • A public notice is issued on the same day on PSX website inviting the public to file claims against the defaulter stock-broker. Such notice is also published in at least two widely circulated newspapers of Pakistan in English & Urdu languages.
  • The Default Committee dispatches the Investor’s Complaint/Claim Form (available on PSX website) at the registered address of each customer of the Defaulter available with CDC and /or NCCPL.
  • To ensure in-depth verification of filed claims and to maintain transparency and independence, PSX engages an audit firm to verify the genuineness of claims of the aggrieved parties.
  • The approved claims are settled from the funds made available from the disposal of assets of the defaulted stock-broker under custody with PSX. The claims still remaining unsatisfied are then paid from CCPF upto a maximum limit of PKR 500, 000 in the manner provided in Chapter 24 of PSX Regulations.

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Archive: November 18, 2022