📈 SEC Act Framework: Strict Measures Against Market Manipulation

• Market Rigging & False Trading (Sec 128): Focuses on effect over intent. Trading that creates a false appearance of volume or price without changing beneficial ownership is prohibited. Courts consider order timing as key evidence; statutory defense shifts the burden of proof to the accused. • Price Manipulation & Intermediaries (Sec 129): Prohibits artificial price-setting (raising, lowering, or stabilizing) through direct trading, layered structures, or proxies. • Misleading Information & Analyst Duty (Sec 130-131): Criminalizes reckless or false statements, forecasts, and concealment of material facts. Capital market professionals, company directors, and research analysts face higher compliance standards to substantiate advice. • Broad Anti-Fraud Provisions (Sec 132): Captures evolving manipulative schemes and deceptive devices to maintain investor confidence in the Colombo Stock Exchange (CSE). • Regulatory & Compliance Oversight: Market manipulation offences act as financial red flags for the Central Bank’s Financial Intelligence Unit (FIU). Under IOSCO principles, stockbroking firms and investment advisors must maintain robust internal controls, risk profiling, and independent research. _Provisional analysis based on SEC Act regulatory provisions._