The Bangladesh Securities and Exchange Commission (BSEC) has launched a detailed investigation into suspected insider trading and market manipulation involving several listed companies, including Khulna Power Company Ltd (KPCL) and United Power Generation and Distribution Company Ltd (UPGDCL).

In a revised order issued on October 7, the securities regulator directed an investigation into whether United Group Chief Adviser Hasan Mahmud Raza and United Enterprises & Company Ltd (UECL) Chairman Moinuddin Hasan Rashid had any direct or indirect involvement in the suspected irregularities.

The commission has formed a three-member high-level investigation committee headed by BSEC Director Mohammad Shamsur Rahman. Joint Director Ziaur Rahman and Assistant Director Ali Ahsan are the other members. The committee has been instructed to complete the investigation and submit its report within 60 working days from the issuance of the revised order.

The investigation follows complaints filed by MM Habibullah and Nuruzzaman Jinnah, who alleged that undisclosed beneficial ownership, allegedly through benami beneficiary owner (BO) and trading accounts opened in other people’s names, was used to facilitate insider trading and share price manipulation.

The committee will examine relevant bank accounts, BO accounts and trading accounts associated with United Power, its subsidiaries, affiliated entities, officials, employees, associates and close relatives to identify the actual owners and controllers of the accounts and determine who benefited from the transactions.

Investigators will also trace the sources of funds used to purchase shares and examine transaction flows to identify any suspicious financial dealings involving UECL, its subsidiaries or related individuals. The investigation will seek to establish the ultimate beneficiaries of cash dividends and other income generated from the share transactions.

The committee will scrutinise whether artificial price increases, fraudulent schemes or coordinated market manipulation occurred involving shares of United Power, KPCL and other companies. It will also investigate whether sensitive or undisclosed price-sensitive information was used to conduct unlawful trades, who had access to such information and how it may have been shared.

The inquiry will cover not only the individuals and entities named in the complaints but also the roles of relevant stockbrokers, merchant banks, commercial banks, Central Depository Bangladesh Limited (CDBL) and other financial intermediaries. Investigators will examine whether any negligence or complicity by these institutions facilitated account openings, share purchases, dividend payments or fund transfers.

The commission will also determine whether any securities laws or regulations governing insider trading, unauthorised account operations and the concealment of beneficial ownership were violated. The investigation will examine the possible involvement of other individuals or organisations, including the complainants, without presuming wrongdoing before the inquiry is completed.

According to the regulator’s order, the investigation may be expanded if additional significant information or evidence related to the alleged irregularities emerges during the inquiry.

Market participants view the move as part of broader efforts to strengthen corporate governance and reform the capital market. They believe that a thorough investigation and appropriate action against any proven offenders could help restore investor confidence.

No findings of wrongdoing have been established against the individuals or entities named in the investigation at this stage.