The Bangladesh Securities and Exchange Commission (BSEC) has fined three institutions a total of Tk 11 crore 10 lakh for severe manipulation in the share transactions of Alif Industries Limited, a company listed on the stock market. According to BSEC sources, the commission imposed this substantial fine after a detailed investigation and hearing.

BSEC found that these institutions attempted to artificially inflate the share price of the company by creating fake or artificial demand, which is a direct violation of stock market regulations.

The investigation into the manipulation covered the period from February 5 to May 9, 2024. During this period, the share price of Alif Industries rose from Tk 75.10 to Tk 136.10. This unusual price surge caught BSEC’s attention, leading the commission to launch a formal investigation. Notably, the current share price has fallen to Tk 46.

BSEC’s investigation revealed that Faruq Enterprise, Raiyan Trading, and Islam Enterprise jointly engaged in “circular trading,” artificially buying and selling shares at inflated prices to create false signals in the market. Their activities exceeded normal supply-demand dynamics and influenced investor sentiment.

Among the three institutions, Faruq Enterprise made a profit of Tk 3 crore 44 lakh through manipulative activities and was fined Tk 3 crore 12 lakh. During the hearing, Kazi Mehedi Arafat, representing Faruq Enterprise, submitted a written explanation denying all allegations. They claimed all transactions were based on legitimate investment strategies and prevailing market conditions, and that none of their trades created artificial demand or misled investors.

Raiyan Trading made Tk 3 crore in profit and was fined Tk 2 crore 73 lakh. The company explained that it did not collude with Faruq Enterprise, Islam Enterprise, or any other entity, and that its breach of the 10% shareholding limit was unintentional.

BSEC found Islam Enterprise to be the most heavily involved in the manipulation. The institution earned Tk 5 crore 81 lakh in profit and received the highest fine of Tk 5 crore 25 lakh. Representing the company at the hearing, Rubel Bhuiyan denied allegations of artificial trading or intentional price manipulation. He stated that all transactions were conducted based on legitimate strategies and market conditions, and that they did not coordinate with any other entity. They emphasized that all BO accounts were used for legitimate purposes and that no self-trading or market manipulation occurred.

According to the latest shareholding data, 30.24% of Alif Industries’ shares are held by sponsors and directors, 10.14% by institutional investors, and 59.62% by general investors.