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include extending to each other financial services normally rendered by banking institutions.
The two firms were suspended in terms of Section 49 of the Securities Act to facilitate investigations.
Stockbrokers are basically supposed to sell or buy shares on behalf of clients.
They also offer advisory services.
The alleged transaction emerged last week after Remo failed to recover the shares it had pledged as security after borrowing money from Interfin Securities.
The amount borrowed could not be immediately established yesterday, although the value of the shares is understood to be nearly US$2 million, sources said.
Remo is understood to have paid back the loan, but Interfin refused to release the shares.
According to sources, the owner of Remo, Mr Mohamed Mahmed, through a company in which he is a director, owes Interfin Securities — “the reason why Interfin Securities refused to surrender the shares probably fearing that it would be exposed”.
An investigation has been launched to establish what transpired.
SEC chief executive Mr Tafadzwa Chinamo confirmed the story in an interview yesterday.
“It’s true (that) there is an investigation going on right now,” he said. “But the best person to speak to is the Zimbabwe Stock Exchange (chief executive Mr Emmanuel Munyukwi).
“They came to us and told us that this is what is happening. We told them to do what is best (in terms of the situation) and suspension was deemed to be the most appropriate decision to take,” said Mr Chinamo.
Mr Munyukwi confirmed this. “It’s true that Remo and Interfin Securities have been suspended following consultation between the ZSE and the Securities Exchange Commission,” he said.
“An investigation will be carried out to establish the nature of these activities.”
A director at Remo, Mr John Motsi, yesterday said they had not received a written notice of suspension from the market regulator or the Zimbabwe Stock Exchange.
Interfin Securities executive director and stockbroker Mr Rufaro Zengeni could not be reached for comment at the time of going to press as he was said to be in meetings.
The SEC has the power to intervene in the event that irregularities arise in the conduct of licensed members.
The ZSE, for its part, supervises and monitors the trading process to ensure transparency and to prevent manipulation.
Any unethical or criminal activities are dealt with within the framework of the rules and regulations governing equity transaction of the ZSE.
Online Reporter