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Under the noses of SEC, PSE, PDTC: AR got away with trading 126.17B unlisted shares for months

It’s time to let the cat out of the bag after market regulators suspended trading of one of the country’s hot-flying stocks, Abra Mining and Industrial Corp.

READ: Who’s in charge? High-flying stock walking on thin ice due to messy public ownership records

Yes, our Babbler was alluding to AR, a dormant mining firm, as the ”Hot Stock” (HS) which was trading unlisted shares during its steep climb in the last few months.

READ: SEC, PSE suspend most-traded stock: Beloy family’s Abra Mining found illegally selling unlisted shares

Yes, our Babbler was alluding to AR, a dormant mining firm, as the ”Hot Stock” (HS)which was trading unlisted shares during its steep climb in the last few months.

After the “Burst Your Babble” piece came out on February 7, AR’s stock started its sharp decline while the Securities and Exchange Commission and Philippine Stock Exchange started looking into the records of HS.

Our Babbler was surprised it took the Philippine Depository and Trust Corp. days or weeks to verify the rumor that billions of unlisted AR shares were being traded in the market.

The Babbler said a simple check of AR’s public ownership records (from the quarterly beneficial ownership report of the Philippine Central Depository Inc.) showed that it was trading roughly 126.17 billion shares over its listed shares of 73 billion in the fourth quarter of 2020.

The Babbler noted that Citibank N.A. held the biggest number of AR shares with 58.845 billion as of September 2020 but this shrank to 70.75 million as of December 2020.

During the same period, the shares lodged with two retail brokers surged – COL Financial to 56.3 billion shares from 19.165 billion shares; and First Metro Securities to 22.42 billion shares from 9.4 billion shares.

The Babbler explained that before shares could be traded, the stock certificates should be signed by AR’s corporate secretary, Amelia G. Beloy (also CFO, treasurer and VP for administration), the mother of the company chairman and president, James Beloy.

The Babbler said AR’s stock transfer agent is Asian Transfer & Registry Corp. which holds office in the same building as AR and has only one client, AR.

The Babbler said the SEC and PSE did right by suspending the stock and making an audit of the shares.

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