THE Philippine Stock Exchange (PSE) is warning investors against buying and selling Benguet Corp. shares until the matter surrounding the firm’s penalties, which includes a 30-day trading suspension, is resolved.

The exchange likewise stood by its sanctions as it noted that “the imposition of penalties was done only after careful and deliberate evaluation of the views of Benguet on the disclosure matters at hand over an extended period of time,” wrote PSE president and chief executive officer Francis Lim in a notice posted on the exchange’s website.

The Exchange also took into account the corporation’s record of non-disclosure violations in the past, he added.

The PSE had intended to enforce the suspension of Benguet’s shares on October 27 alongside monetary fines, for repeatedly violating its disclosure rules, before it received a “strict” directive from the Securities and Exchange Commission (SEC)  barring the bourse from enforcing any penalties on the mining company.

The SEC was responding to a letter from Benguet contesting the decision of the bourse. The corporate regulator, however, did not provide additional reasons for its move.

“In light of the foregoing, the Exchange feels duty bound to advise the general public to exercise caution and due diligence before buying and selling Benguet Corp. shares,” wrote Lim.

The SEC, which has the power to appeal decisions of the PSE, has given the Exchange until Tuesday to respond to Benguet’s letter.

In a chance interview on Friday, Lim said the exchange is confident on the merits of its argument.

The PSE said in its decision dated October 19 that Benguet failed to disclose that it had received several notices of default from the Philippine National Bank trust banking group. In addition, the PSE said the company withheld “pertinent details” relating to its restructuring agreement.

The disclosure system is designed to protect stock market investors as it allows them to make informed decisions before executing a trade on a company.

“The situation now is if the SEC will either agree or disagree with us. If they agree with us, then we will implement penalties. If they disagree with us, that is another matter,” said Lim. He disclosed that if the SEC overrules the decision of the exchange, then the PSE may bring the matter to “the courts.”

“I am confident that when the SEC listens to both sides, they will uphold our position,” said Lim.

Benguet’s debt woes started in the late 1980s when it obtained consolidated loans of P4.2 billion to finance mining projects, in particular its Antamok Gold Project in Itogon, Benguet province which turned out to be unprofitable. Benguet’s debts are estimated to reach P1.2 billion.