The Offenders` Manipulation with the Partners` Money and Hiding the Fact of the Financial Status of the Companies was revealed
MCI has referred managers and officials in seven joint-stock & limited liability companies to the Bureau of Investigation and Public Prosecution after proving administrative & financial abuses related to the Corporate Law, represented in the non-observance of those responsible with the application of the mandatory rules requested by the regulations and decisions. This is with regard to the issuance of annual budgets, also lack of commitment to provide the shareholders and partners with the periodic reports of the companies works, as well as to be presented to the General Assembly, which is considered a violation of the materials (66,84,89,174,175) of the Corporate Law, indicating that all the necessary legal procedures would be taken against those responsible, in accordance with Article (229) of the mentioned Law.
MCI assured monitoring several offenses related to the manipulation with the partners money, who were not aware of the real financial status of the companies, along with the lack of responding to MCI letters, stressing at the same time that MCI would follow up the adherence of all corporate officials, including the managers and members of the board of directors, and how far they are committed to the provisions and items contained in the corporate law, asking all the companies officials to respond urgently to MCI instructions, so as to avoid the penalties contained in the aforementioned law.
This comes within the plan set up by the Ministry to monitor the violating companies and to take the necessary procedures to protect the investors' money, according to the Royal Order No. (4690) dated 06/02/1435 AH containing the transfer of competences of the agencies and commissions concerned in investigating and prosecuting the criminal offenses to the Bureau of Investigation and Public Prosecution. All that comes within the Ministry's keenness and ongoing follow up to protect the shareholders' rights, and to emphasize its supervisory and control role on the companies in the Kingdom.
MCI reconfirmed the need for fair and rational practices, as well as the application of transparency and disclosure standards, in accordance with the basic principles of the corporate governance in the Kingdom, which aims to sustain and develop the economic entities, explaining its pursuit to promote and protect the rights of all dealers with companies, as well as to ensure the proper and fair application of the standards and provisions of the transparency and disclosure of the financial status of the companies, represented in its financial statements, performance, distribution of property, and that to be done on time and with accurately.