Saudi Arabia’s Capital Market Authority (CMA) has revealed a staggering 4275 percent surge in the value of compensation for individuals affected by errors and violations in securities disputes, reaching 2.2 billion riyals ($586 million) over the last four years.
In 2022 alone, the compensation value amounted to 1.75 billion riyals, compared to 40 million riyals in 2019, 93 million riyals in 2020, and 367 million riyals in 2021.
The number of compensators has also witnessed a significant rise, with a total of 2,352 individuals seeking compensation in the past four years.
In 2022, the number soared to 1,294 individuals, marking a massive 2057 percent increase from 2019 when only 60 individuals sought compensation. The figure climbed to 445 individuals in 2020 and further rose to 553 individuals in 2021.
The CMA highlighted that class action lawsuits accounted for a substantial portion of the compensation awarded in 2022, amounting to 1.225 billion riyals, which represents approximately 70 percent of the total compensation awarded, including dismissals and appeals.
Compensation against violators of the Market Conduct Regulations and Article (49) of the Capital Market Law also increased to reach 323.5 million riyals in 2022, marking an 18 percent rise from the previous year’s 274.4 million riyals.
Furthermore, the compensation amount against unauthorized securities practitioners witnessed a remarkable surge of 202 percent in 2022, totaling 53.2 million riyals compared to 17.6 million riyals in 2021.
Compensation against listed companies rose by 300 percent to reach 52.9 million riyals in 2022, while compensation against market institutions amounted to 37.5 million riyals. Other compensation recorded by the end of 2022 reached 59.7 million riyals.
The significant increase in both the value of compensation and the number of compensators highlights the growing emphasis on securities dispute resolution and the CMA’s commitment to protecting investors and ensuring market integrity.