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11.08.2004 Business & Finance

Public Notice on CDH Securities Limited

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CDH Securities Company limited was licensed by the Securities and Exchange Commission, under PNDC Law 333, the Securities Industry Law as amended, as a Dealer to provide brokerage and related services to clients.

CDH Asset Management limited was licensed by the Securities and Exchange Commission to provide :

-investment advisory services to clients, this includes carrying on the business of advising others concerning securities;

-publishing analyses or reports concerning securities;

-managing a portfolio of securities for the purpose of investment

Section 83 of PNDC LAW 333 requires every holder of a dealer's license to maintain accounting records that will correctly record and explain the transactions and financial position of the business of dealing in securities carried on by him. In addition to that, the license holder must keep accounting records in such a manner as will enable true and fair profit and loss accounts and balance sheets to be prepared from time to time.

In furtherance of these legal requirements and pursuant to the SEC Regulations L.I. 1728, Regulation 33, the two companies are to submit periodic reports and returns to the Commission.

These reports are

A monthly cash flow and statement of liquid funds

Quarterly financial statements

Annual audited accounts

In order to safeguard the interests of investors or clients that may have engaged their services, these reports and returns are required from the license holder to enable the regulators confirm that the dealer is carrying on business in the manner required.

The integrity of the capital market depends to a great extent on the quality of financial information made available by the professionals who operate in the market. The regulators have a duty to ensure that these regulatory standards are met and maintained.

As part of their operational and compliance regime, it is expected that all market operators would have adopted the rules put in place by the regulator and applied them to their operations to safeguard the interests of the investors,

Over the last few months CDH Asset Management have been found to be non compliant with these requirements thus making it difficult for a true and proper assessment of their operations to be undertaken by the regulator.

It is for this reason that the SEC has had to suspend the licenses of CDH Securities and CDH Asset Management while we review their past operations over the next two weeks.

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