The Bangladesh Securities and Exchange Commission (BSEC) has formed a three-member investigation committee to examine allegations of financial and operational irregularities at merchant bank Citizen Securities & Investment Limited, including unauthorized credit facilities and interest income earned without valid agreements.

The order was recently issued by the BSEC’s Market Intelligence and Investigation Division. The committee has been instructed to complete its inquiry and submit a report to the Commission within 60 working days. The company’s Managing Director has been formally notified of the investigation.

BSEC Executive Director and spokesperson Abul Kalam said the probe was initiated in response to investor complaints and in the interest of protecting the capital market. He added that legal action would be taken against those responsible if the allegations are substantiated.

The investigation committee comprises Additional Director Mohammad Al Masum Mridha, Assistant Director Amit Kumar Saha, and Assistant Director Ali-Ahsan.

According to the investigation order, the committee will examine whether unauthorized transactions were carried out through five beneficiary owner (BO) accounts and determine the nature and extent of any violations.

The probe will also investigate allegations that non-margin accounts were illegally converted into margin accounts without investors’ consent, whether credit facilities were provided without valid agreements, and whether excessive trading was conducted to inflate income.

In addition, investigators will examine claims that the company charged interest without valid margin agreements or customer authorization, failed to process investors’ requests to withdraw proceeds from share sales, and refused to accept or process share transfer applications.

BSEC said the investigation aims to safeguard the interests of investors and maintain the integrity of Bangladesh’s capital market.