Brokers divert Honeywell public offer subscribers’ money

This is like sounding the alarm, Fortune&Class Weekly has been informed that some cash strapped stock brokers have had to divert funds paid to them by investors to purchase the recently concluded Honeywell Flour Mills public offer.

Market trend watchers said beside those brokers that deliberately expropriated the funds to their own use because of the paucity of funds in the market and the near non-existence of transactions in the secondary market, bankers to brokers are impounding, more or less, all money lodged in the accounts of brokers.

“You know that the bank accounts of some brokers are at the moment committed to huge default margin from the banks which the banks on the other hand are desirous of recovering. So, what is happening now is that the public offers like the one conducted by Honeywell provides opportunity for liquidity. What I have heard is that once a debtor-broker pays an investor’s cheque into a bank account, the bank almost certainly confiscates the fund at the matured date of the cheque to offset their exposure to the broker.

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