The Bangladesh Securities and Exchange Commission on Tuesday banned First Security and Services Limited chief executive officer Kazi Saifur Rahman from any sort of affiliation with the capital market for five years for illegal share trading and price manipulation.
The commission also fined Saifur Tk 10 lakh, First Securities Services Limited (FSSL) Tk 15 lakh and Heritage Capital Management Limited (HCML) Tk 25 lakh for the same offence. HCML vice-chairman Shahana Tasnim Lopa is wife of Saifur.
The BSEC has found that Saifur was involved in a ‘series of transactions’ of shares of Bangas Limited and Tallu Spining Mills through which he made hefty profits.
Saifur in his beneficiary accounts with FSSL and HCML transacted shares of Bangas Ltd between April 8, 2013 and July 28, 2013 and earned a profit of 42.30 per cent.
The Bangas authorities on July 25, 2013 declared five rights shares against one existing shares.
On September 1, 2013, after the announcement, FSSL signed an agreement with Bangas to become the issue manager and under-righter for the rights offering.
BSEC officials said that Saifur knew that Bangas was going to offer rights shares as his company was eventually made issue manager.
‘The activities of Saifur, First Security and Services Limited and Heritage Capital Management Limited were done with ill motivates and fell under “series of transactions”, said a BSEC press release on Tuesday.
It said that Saifur was also involved in similar trading of Tallu Spinning Mills shares during April 8-September 10, 2013 and achieved 4.29 per cent gain.
As per the BSEC finding, Saifur violated different section of securities rules with his direct involvement in share business as a CEO of a brokerage house.
A BSEC official said that FSSL authorities would have to remove Saifur and he would not be able to hold any post in any organisation related to capital market.
The commission, meanwhile, also fined two other brokerage houses — Phoenix Securities Limited and Apex Investment Limited — Tk five lakh each for violation of securities rules.
As per the BSEC inspection, Phoenix Securities provided loan facility to its directors and made transactions of over Tk 5 lakh in cash in violation of rules.
BSEC found that Apex Investment’s consolidated customer account remained short by Tk 5.96 crore and Tk 5.19 crore in the years of 2011 and 2012 respectively. The fund in the consolidated customer account is payable to the clients.
-With New Age input
