KSE March 2005 Crash: SECP Forensic Investigation Report

At the request of the Securities and Exchange Commission of Pakistan (“SECP”), Diligence USA, LLC (“Diligence”) conducted a forensic examination of certain alleged manipulative and/or illicit activities related to the stock market events of March 2005, as
transacted on the Karachi Stock Exchange (“KSE”). The primary allegations examined related to the withdrawal of regulated COT (“Carry Over Transaction” financing, also known as “Carry Over Trade” or Badla financing) and in-house Badla, wash trades, and
violations of Clause 3(b) of the Regulations Governing Futures Contracts (exceeding the Rs 50 million reporting threshold).