The Bangladesh Securities and Exchange Commission on Wednesday fined Reliance Brokerage Service Limited Tk 10 lakh for violating different margin loan-related securities rules.
The decision was taken at a regular commission meeting presided over by the BSEC chairman, M Khairul Hossain. A BSEC news release said Reliance Brokerage Service violated margin loan rules by providing margin loan for buying ‘Z’ category shares, providing margin loan as a dealer and giving margin loan to its director.
The firm also violated securities laws by providing margin loan to clients within 15 days of account opening and giving margin loans to buy shares having price earning ratio above 40, the release said.
Reliance Brokerage Service gave margin loan for buying shares of Deshbandhu Polymer and Salvo Chemicals during the period of their category change. Giving margin loan to buy shares of a company within 30 days of its category change is prohibited.
The firm also allowed cash transaction facility over Tk 5 lakh and provided misleading information about margin loan details, the BSEC found.
The commission also found a deficit of Tk 2.22 crore in the customer consolidated bank account of Reliance Brokerage Service.
-With New Age input
