The Bangladesh Securities and Exchange Commission on Tuesday imposed a massive Tk428.52 crore fine on nine individuals and companies for manipulating the shares of Bangladesh Export Import Company Ltd (Beximco).
The unprecedented amount of monetary penalty was imposed during a BSEC commission meeting chaired by its chairman Khondoker Rashed Maqsood.
A BSEC investigation revealed widespread manipulation in Beximco Ltd stock trading between July 28, 2021, and September 6, 2021, as well as January 2, 2022, and March 10, 2022.
During the period, Beximco’s share price spiked from Tk91.30 to Tk119.8 and later from Tk154.1 to Tk152, raising suspicions of price rigging.
The investigation uncovered significant manipulation, leading to penalties of four individuals and five institutional investors.
Mosfequr Rahman was fined the highest amount of Tk125 crore, followed by a company named Crescent Ltd Tk73 crore.
Momtazur Rahman was fined Tk58 crore, Abdur Rouf Tk31 crore, Marjana Rahman Tk30 crore, ART International Limited Tk70 crore, Jupiter Business Tk22.5 crore, Apollo Trading Tk15.01 crore and TradeNext International Tk4.01 crore.
Beneficiary investor Abdur Rouf was a director at Crescent Ltd, while Mosfequr Rahman had ties to Jupiter Business Ltd.
Both Jupiter Business and TradeNext International were allegedly linked to BEXIMCO Group.
The investors were involved in circular trading schemes to inflate share prices artificially.
The investigation report prepared by Dhaka Stock Exchange revealed that the errant investors collectively gained Tk 846 crore from the manipulative trades, with Tk319.74 crore realized and Tk526.48 crore in unrealized gains.
The DSE submitted its findings in 2022, but the then BSEC chairman Shibli Rubayat-Ul Islam shelved the report for two years.
Salman F Rahman, the private industry and investment adviser to the deposed prime minister Sheikh Hasina, owns Beximco Ltd.
Salman Rahman is now in jail in several murder cases, and Shibli Rubayat-Ul Islam resigned as BSEC chairman following the ouster of the government.
The BSEC at the commission meeting also decided to inspect the use of initial public offering and repeat public offering funds of nine companies.
The companies are Bangladesh Shipping Corporation, Best Holdings, Index Agro Industries, JMI Hospital Requisite Manufacturing, Lube-rref (Bangladesh), Navana Pharmaceuticals, Ring Shine Textiles, Sikder Insurance Co and Silva Pharmaceuticals.
