SECP Salary Scandal: Rs 41 Billion Irregularities Unchecked, Chairman Seeks Extension Amidst Public Outrage

Islamabad: Investigations into a staggering Rs 41 billion financial scandal at the Securities and Exchange Commission of Pakistan (SECP) are reportedly stalling, raising serious concerns about accountability and institutional impunity. Despite the Auditor General of Pakistan’s 2024-25 report exposing massive irregularities, including unauthorized salary hikes and questionable financial practices, no concrete action has been taken to recover the misappropriated funds or address the systemic issues within the regulatory body. Adding to the controversy, SECP Chairman Akif Saeed, who is at the center of the controversy, is seeking an extension of his tenure, sparking outrage among the public and business community.

The audit report revealed that Chairman Saeed received Rs 41.53 million in salary during FY2023-24, while each commissioner received Rs 35.8 million. These substantial pay increases, some retroactive by 18 months, were implemented without the required approval from the Ministry of Finance, violating the Public Finance Management Act 2019. Furthermore, other SECP employees received a collective Rs 156.6 million in unauthorized salaries and benefits, along with an additional Rs 110.9 million disbursed as a “Rest and Recreation Allowance” despite no legal basis for such payments. The SECP’s attempts to challenge the audit findings were dismissed as inadequate.

Beyond excessive compensation, the audit uncovered broader financial mismanagement. The SECP withheld Rs 14 billion in revenue due to the Federal Consolidated Fund, including Rs 7.1 billion in licensing and corporate fees. An additional Rs 6.99 billion in surplus revenue was also retained without authorization, bringing the total unaccounted amount to nearly Rs 41 billion. These practices, according to auditors, breached reconciliation procedures and diverted public monies without proper documentation.

The Senate Finance Committee recommended revoking the SECP’s authority to determine its own salaries, and the Public Accounts Committee initiated a separate review, expressing alarm over the magnitude of the violations. Senators highlighted inflated monthly remuneration surpassing Rs 14 million for certain officials, warning that such conduct eroded parliamentary trust in the regulatory agency.

While the Law Secretary assured legislators that amendments would be implemented to govern salary determination, no specific timeline has been provided. The Finance Ministry has also remained silent on potential recovery of the disbursed funds or any penalties for involved officials. Lawmakers allege that oversight attempts are being hindered by internal resistance within the SECP and institutional influence protecting implicated officers.

Chairman Saeed’s pursuit of a tenure extension despite the ongoing scandal has ignited fierce debate. Critics contend that granting an extension would signal acceptance of financial misconduct at the highest regulatory levels. Business leaders express concern that retaining the current leadership without accountability will erode investor confidence and deter both domestic and international investment in Pakistan’s vulnerable markets. Public frustration is mounting, with the situation perceived as another instance of powerful figures evading accountability.

Analysts caution that unresolved irregularities within a crucial financial regulator have ramifications beyond excessive salaries. If the body responsible for overseeing capital markets and corporate governance is viewed as compromised, investor trust will diminish, hindering capital market growth and threatening broader economic stability.