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The stock market regulator has fined four individual investors, a company's chairman & directors and two brokerage firms Tk 8.30 million in total for violating the securities rules and manipulating stock prices.
The Bangladesh Securities and Exchange Commission (BSEC) slammed the fines on them in the last week of May upon hearings on investigation reports submitted by the Dhaka Stock Exchange (DSE).
As per the regulatory decision, Rabeya Khatun, chairman of Mithun Knitting & Dyeing [new name Toyo Knitex), and directors -- Md Atiqul Haque, Md Mahbub-Ul Haque, and Md. Rafiqul Haque -- were fined Tk 1.20 million in total for failing to submit audited financial reports for FY22.
Mithun Knitting did not submit audited financial statements for FY22 until the inquiry was done, along with other misconducts, according to a report submitted by the enforcement department of the BSEC.
The report was published on Sunday.
Also, the company has no functional website and sponsor-directors of the firm failed to hold minimum shares. They sold shares after the listing, bringing down their stake to 17.20 per cent, much lower than the compulsory 30 per cent.
The unavailability of the financial statements has kept investors in the dark. Moreover, the company has failed to pay dividends since 2016.
The regulator asked the accused to pay the fines within 30 working days. Failure to pay the fines within the timeframe will cause an added penalty of Tk 10,000 for each day after the deadline.
The BSEC also fined four individual investors Tk 6.5 million in total for violating rules in transacting shares of Janata Insurance.
Of the investors, Md Saif Ullah has been fined Tk 4 million, AG Mahmud and SM Motaharul Janan jointly Tk 2 million and Hasina Akther Tk 0.5 million.
They traded in shares of Janata Insurance between them, creating a false impression about the demand for the stock.
According to the law, any investor, who wants to hold or acquire more than 10 per cent of the shares in a listed company, must announce their intention before the transactions.
However, they did not follow this rule. They transacted shares "unfairly" to make profits, according to the BSEC.
This is the fourth time Md Saif Ullah and AG Mahmud have been fined within a span of two years.
The securities regulator also fined Gateway Equity Resources, DSE TREC Holder, Tk 0.5 million for several violations, including bank data manipulation to show surplus in the customers' payable position while the customers consolidated accounts were negative.
The securities also penalized Hillcity Securities, a CSE TREC holder, with a fine of Tk 0.1 million as it violated rules by making cash payments to some clients instead of delivering account payee cheques.