Kuwait Central Bank Chief Denies Illicit Share Trading

Kuwait’s central bank governor Mohammad al-Hashel denied that he had conducted any illicit share trading, after a local newspaper reported the securities regulator had decided to refer him to prosecutors on suspicion of violating investment rules.

The newspaper al-Jarida, quoting unnamed sources, reported on Thursday that the case related to an investment that Hashel had made in a Kuwaiti bank, which the report did not name.

It said Hashel was suspected of violating Capital Markets Authority rules because, as a senior official, he was able to see private confidential financial details of the bank that were not available to other shareholders.

In a statement to the state news agency KUNA, Hashel said he had never traded shares in any listed company during his years in senior posts at the central bank, and that data from the Kuwait Clearing Company confirmed this.

He said he had bought 7,000 shares in a local bank “many years ago” before he held a senior central bank post and before the CMA was created, but had not traded those shares for a long time.

Hashel subsequently subscribed to a capital increase in which the bank’s shareholders had priority, buying 2,172 more shares, but the purchase did not involve using internal information or any conflicts of interest, he said.

Repeated calls to the CMA by Reuters on Thursday were not answered.

Hashel, who has publicly criticised wasteful government budgets and big increases in state spending, became central bank governor after being promoted in 2012 from his position as deputy. He is 40, unusually young for a top official in Kuwait.

The Gulf emirate has suffered bouts of political tension in recent years amid accusations of corruption and mismanagement levelled at senior government members and loyalists, including members of the ruling family, by former members of parliament and opposition politicians.