The Bangladesh Securities and Exchange Commission (BSEC) has launched a series of enforcement action against listed companies, their directors, auditors and issue managers following investigations into financial irregularities and violations of securities laws.
In its 973rd commission meeting, chaired by BSEC Chairman Khondoker Rashed Maqsood, the regulator decided to refer the case of ACME Pesticides Limited to the Anti-Corruption Commission (ACC) for necessary action.
The ACC will investigate four board members -- Chairman Shanta Sinha, Managing Director Reza-ur-Rahman Sinha, Director Ahsan Habib Sinha, Director K M Heluar -- along with Company Secretary Sabuj Kumar Ghose, Chief Financial Officer Selim Reza, and several placement holders including SK Trims & Industries Ltd, Bikrampur Potato Flakes Industries Ltd, Bengal Assets Holdings Ltd, Chittagong Pesticides & Fisheries Ltd, Heritage Capital Management Ltd, and NRB Equity Management Ltd for failing to pay against allotted shares.
The BSEC also initiated proceedings to cancel the registration of Shahjalal Equity Management Ltd (SEML), the issue manager of ACME Pesticides, for submitting false or inconsistent information in the prospectus and failing to perform its responsibilities.
Action will also be taken against audit firm Shiraz Khan Basak & Co. for not reflecting ACME’s true financial condition in pre-IPO audited statements.
Auditor Shafiq Basak & Co. will face referral to the Financial Reporting Council (FRC) for inadequately disclosing IPO proceeds in audited reports.
Genex Infosys Limited also faced penalties after BSEC found violations of securities laws during trading of Sonali Paper & Board Mills Ltd shares between December 1 and December 30, 2021. Each of the nine directors, including Chairman and Independent Director TIM Nurul Kabir, Vice Chairman Prince Mojumder, and Acting Managing Director & CEO Shah Jalal Uddin—was fined Tk 1.03 crore, while Genex Infrastructure Ltd was fined Tk 2.55 crore.
The regulator further identified serious irregularities in audited financial statements of companies such as Suhrued Industries Ltd (FY2019), Ring Shine Textile Ltd (FY2017-2020), Aman Cotton Fibrous Ltd (FY2020), and Fareast Islami Life Insurance Ltd (FY2018-19). Audit firms including A Haque & Co, Ahmed & Akhtar, Mahfel Haque & Co, Ata Khan & Co, Shiraz Khan Basak & Co, and Islam Kazi Shafiq & Co failed to disclose these irregularities.
Consequently, BSEC issued show-cause notices seeking explanation on why these auditors should not be barred for five years from auditing listed companies, investment schemes, and capital market intermediaries, according to a press release.
BSEC said these stringent measures aim to uphold transparency, accountability, and investor protection in Bangladesh’s capital market.
