Probe body set to submit report by deadline

The probe committee on the recent stock market crash has dug up that through 'market manipulation' big traders have taken away a sizeable amount from the market as profit, sources said. A competent source said, the probe committee is now figuring out the money siphoned off sector by sector by these manipulators. "The probe committee feels that after the final calculation, the aggregate amount of the money taken away from the market is likely to be at least Tk 30 billion or even more," the source told the FE. The alleged manipulation got underway through the issuance of illegal placement and preference shares, settlement of loans through stocks, asset re-evaluation, share split, and a series of ill-motive transactions. The probe body has identified top businessmen, politicians, officials of securities regulator and other offices, the directors of the prime bourse -- Dhaka Stock Exchange (DSE), stakeholders and well known big individuals for the market crash. The probe body passed through a bitter experience while investigating the roles of some officials at the Securities and Exchange Commission (SEC). "The securities regulator will not be able to operate properly with the activities these officials. The government should remove the controversial officials from the SEC for the sake of regulating the market properly," the source related to the probe body told the FE. "The whole body of the SEC cannot be changed. So the probe body is thinking of recommending to the government the removal of some top officials so that the vested quarters cannot motivate them for personal interests," he added. In some cases, the probe body has become "confounded" after finding suspicious share transactions by even some small traders. The probe body Monday experienced another shock after receiving information that an individual investor made a hefty profit of Tk 2.5 billion within one year through a series of transactions. "It's unbelievable and unprecedented as well. This individual has outdone even some well known big fishes who usually are involved in such a market scam," the source added. "Normal trading is not illegal. The probe body will address the ill motives that helped them reap hefty gains," he said. Some members of DSE board of directors were not able to receive any more private placement shares due to their "overfed" condition, it was learnt. When asked about the names of DSE board members, the source said, "Who are not on the list of the members that have received private placement shares?" The source added, a profit amounting to Tk 5.0 billion was taken away from the market by selling only the private placements of six mutual funds. Professor Dr. Taufiq Ahmad Chowdhury, a member of the probe body, said, "Some people in Bangladesh have used rotten products like 'share converting into loans' to make the market overheated." "Conversion of shares into loans is one of the main reasons behind the global financial meltdown. That's why presently, this product is not utilised anywhere in the world. But unfortunately, some people here have made the best of these products," Mr. Chowdhury told the FE. However, he said the probe body would submit a 'very interesting and crucial' report that would also reveal the identities of some insiders who are not known well in the market. The probe body is presently preparing the report on the findings of its investigation. Khondaker Ibrahim Khalid, the chief of the probe committee, said that the body was trying its best to submit the report by deadline. On January 25, the government formed a high-powered probe committee to identify individuals and institutional investors involved in the recent share market scam. Khondkar Ibrahim Khalid, Chairman, Bangladesh Krishi Bank and former Deputy Governor of Bangladesh Bank (BB), has been made head of the committee. The other three members of the committee are Director General of Bangladesh Institute of Bank Management (BIBM) Dr. Taufic Ahmad Choudhury, ex-president of Institute of Chartered Accountants of Bangladesh (ICAB) Abdul Bari and legal expert Nihat Kabir.