The Kuwait Capital Markets Authority announced that its Disciplinary Board issued Resolution No. 10/2025 imposing a warning penalty on Securities House Company for breaches of the Executive Bylaws’ Work Ethics and Financial Technologies provisions in connection with promotional advertising for its automated investment adviser service, “Robo Zad”, offered through the Zad electronic platform. The findings relate to promotional advertisements published on Instagram on 4/12/2024, 6/12/2024 and 7/12/2024 via the Zad platform account managed by Securities House Company and also via an individual’s account. The CMA found the ads omitted required disclosures, including a prominent statement that the material was promotional, the name of the licensed person who issued or approved the content, correct information identifying investment risks, an undertaking that no necessary information had been omitted, and a warning that past performance is not a reliable indicator of future results. It also identified incorrect or unclear historical returns shown for “moderate risk tolerance” portfolios for 2022 (-14%), 2023 (22.5%) and 2024 (14.8%), and concluded these were theoretical backtesting results based on certain inputs and components entered through a public website without disclosure in the advertisement. The penalty was a warning, coupled with a caution on the consequences of repeating the conduct.
Kuwait Capital Markets Authority 2025-06-23
Kuwait Capital Markets Authority imposes warning on Securities House Company for deficient Robo Zad Instagram advertising
The Kuwait Capital Markets Authority's Disciplinary Board issued a warning to Securities House Company for breaches in promotional advertising of its automated investment adviser service, "Robo Zad." The violations included omissions of required disclosures and incorrect historical returns in ads on Instagram. The penalty includes a warning and a caution against repeating the conduct.