The Bangladesh Securities and Replace Commission (BSEC) has taken strict measures against Sinha Securities Ltd, a brokerage firm, attributable to its failure to alter the shortfall in purchasers’ funds within the consolidated customers’ yarn (CCA).
In a meeting on 18 September, the commission made up our minds to freeze all bank and beneficiary owner (BO) accounts of the firm’s directors, including the managing director and chief executive officer (CEO), according to BSEC sources.
The commission requested the Bangladesh Financial Intelligence Unit (BFIU) to freeze bank accounts.
It additionally made up our minds to impose a traipse ban on the administrators, managing director, and CEO of the firm.
Consistent with the Dhaka Stock Replace (DSE), on 14 August, the deficit within the firm’s consolidated customers’ yarn (CCA) stood at Tk8.49 crore. Previously, the deficit used to be Tk 8.51 crore on 7 March, which used to be supposed to be settled by 19 March.
A CCA is a separate checking yarn maintained by stockbrokers to protect unused cash from their purchasers’ beneficiary owner’s (BO) accounts.
It is strictly prohibited to utilise this cash for any reason varied than paying for securities purchased by the patron or collecting commissions or charges owed by the patron.
Any exercise of funds from the CCA for functions varied than these specified payments would result in a deficit within the CCA.
Because the extension period for adjusting the deficit used to be nearing its result in March this one year, Sinha Securities requested one more one-one year extension from the BSEC and asked for a renewal of its depository participant (DP) licences.
On the assorted hand, declining its plea for further time extension, the commission made up our minds to take action against the firm.
Despite several makes an strive, Reza Ur Rahman Sinha, CEO of Sinha Securities, did no longer acknowledge to telephone calls made by TBS.
Md Tawhedur Rahman, supervisor (finance & accounts) of the firm, suggested TBS, “We did no longer acquire any reliable letter from the BSEC.”
Consistent with DSE officers, actual through a instruct inspection final one year, a workforce from the bourse chanced on a deficit in Sinha Securities’ CCA.
This ability that, the BSEC suspended the brokerage firm’s procuring and selling activities from 14 Would possibly per chance also to 27 June 2023. Following a partial adjustment to the deficit, the alternate suspension on Sinha Securities used to be lifted.
Later, imposing some prerequisites, the BSEC directed the firm to alter the deficit internal December 2023. On the assorted hand, it overlooked the time restrict, nonetheless, the commission extended the time until 19 March this one year.
Sinha again overlooked the extended time restrict and requested the BSEC to elongate it for 12 extra months.
Within the letter sent to the BSEC, the firm’s Director Reza-Ur-Rahman stated that the suspension of procuring and selling activities precipitated a quantity of their customers to cease doing alternate with them, ensuing in necessary losses for the firm.
“The unhealthy opponents contained within the alternate has very much diminished earnings, impacting our varied ventures, including procuring and selling and agro-alternate. The introduction of the bottom label by BSEC in 2022 to manipulate the autumn in fragment prices has additionally restricted our procuring and selling ability,” he stated.
“As a result, now we were unable to fulfil our price commitments on time. Within the match of any further delays, we commit to increasing payments by promoting the sponsor shares of one more arena, ACME Pesticide Ltd, which will former in November 2024,” he added.
