To investigate irregularities in the operations of three brokerage houses that are members of the Dhaka Stock Exchange (DSE), the Bangladesh Securities and Exchange Commission (BSEC) has established a three-person investigative committee. The committee has been instructed to report to the BSEC on this matter within the next thirty working days. We know this information from relevant sources.
The brokerage houses are Shyamal Equity Management Limited, Premier Bank Securities Limited, and PFI Securities Limited.
Recently, the BSEC’s Market Intelligence and Investigation Division issued an order in this regard. The managing director or chief executive officer of these three brokerage houses has since received the order from BSEC.
The order stated that an examination of PFI Securities Limited, Premier Bank Securities Limited, and Shyamal Equity Management Limited’s overall operations is required for the benefit of the capital market and general investors. Therefore, Commission 3 officers have been appointed to investigate the activities of the brokerage houses under the powers provided in Rule 17 of the Securities and Exchange Act-2020 and Rule 15 and 16 of the Securities and Exchange Commission (Stock Dealers, Stock Brokers and Authorized) Rules, 2000.
The members of the investigation committee are – Additional Director of BSEC. Ohidul Islam, Assistant Director. Motiur Rahman and assistant director. Sagar Islam The order states that the inspecting officers shall complete the investigation and submit the inspection report to the commission within 30 working days from the date of issue of this order.
Number of margin accounts in three brokerage houses, number of BO accounts with negative equity, actual amount of negative equity, provisions, shortfall in provisions, unauthorized transactions in margin accounts and its reasons and why the amount of negative equity in brokerage houses is increasing and who is responsible for it?
Why are brokerage houses failing to maintain necessary provisions against unrealized losses? In what cases are brokerage houses violating securities laws?
Why are the brokerage houses failing to maintain the necessary provisions against unrealized losses even after asking for more time since 2016?
If there is any other relevant issue in the matter, the same will be identified by the inquiry committee.
After the change of political pot, the previous Hasina government is taking punitive strict measures against all the irregularities of the capital market which is plagued with multifaceted financial irregularities. During the previous government, no strict action was taken against the brokerage houses that violated the law. However, the commission headed by Khandkar Rashid Maqsood, formed on August 18, has taken strict action against the brokerage houses that have shortfalls as customers.
In continuation of this, the inquiry committee inquired into the number of margin accounts of the brokerage houses, the number of Beneficiary Owners (BO) accounts with negative equity, why the negative equity is increasing and who is responsible for it, the amount of negative equity, funds held against provisions or margin accounts, shortfall in provisions, unauthorized transactions in margin accounts, etc. Will look into the matter.
When asked about this, Executive Director and Spokesperson of BSEC Mohammad Rezaul Karim said that an investigation committee has been formed to investigate whether there is any discrepancy in the activities of the brokerage houses. The committee will submit the report to the commission after completing the investigation. If any discrepancy is found in the investigation report, the commission will take necessary action accordingly.
