Saudi Arabia Is Said to Freeze Trading Accounts as Part of Probe
(Bloomberg) -- Saudi Arabia’s market regulator has frozen the trading accounts of individuals being detained or investigated as part of the kingdom’s crackdown on alleged corruption, according to three people familiar with the matter.
The Capital Market Authority is asking brokerages to suspend the accounts of dozens of princes, billionaires and officials being held so they’re unable to buy or sell shares on the Tadawul stock exchange, the people said, asking not to be identified because the information is private.
The kingdom last week said Saudi Arabian Monetary Agency, or SAMA as the central bank is known, had frozen the bank accounts of individuals being investigated, but not those of the companies they own or manage. Wealthy Saudis are moving assets out of the region to avoid the risk of getting caught up in the crackdown, people with knowledge of the matter said. In Saudi Arabia, some are in talks with banks and asset managers to move money outside the country, the people said.
The Tadawul All Share Index fell 1 percent on Wednesday, the most in more than three weeks. A spokesman for Tadawul declined to comment, while officials at the CMA didn’t immediately respond to requests for comment.
In addition, the United Arab Emirates central bank is said to have asked financial institutions to provide information on the accounts of 19 Saudi citizens. The regulator asked to be informed of any accounts, deposits, investments, financial instruments, credit facilities, safe deposit boxes or financial transfers linked to the people, according to a circular seen by Bloomberg.
The arrests, which include Prince Alwaleed bin Talal, one of the world’s richest men, prompted a selloff across the GCC, wiping out almost $19 billion from stock markets in the region in the five days through Thursday. Gulf individuals and institutions sold a net 771 million riyals ($206 million) worth of Saudi shares last week, the most since at least October 2015, when Bloomberg began tracking the data.
Based on investigations over the past three years, Saudi authorities estimate that at least $100 billion has been misused “through systematic corruption and embezzlement over several decades,” according to Attorney General Sheikh Saud Al Mojeb. A total of 208 individuals have been called in for questioning so far and seven have been released without charge.
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