SEC chief sees recurrence of stock scam if investors not trained

FE Report The Securities and Exchange Commission (SEC) Chairman Professor M Khairul Hossain said Saturday small investors could be swindled by the rogue traders again if they lack knowledge about the nitty-gritty of the capital market. "The general investors are likely to be cheated by the opportunists unless they (investors) learn the fundamentals of securities trading," the SEC chief told a training programme in the capital. He said the regulator has enacted tough rules to combat "insider trading" and plug loopholes in the securities laws, but unless the investors know the basics of the trade there is no way the authorities can completely curb manipulation. "Those who have taken away thousands of crores of Taka from the market are waiting for the right time to deceive the general investors again," he said, urging the investors to learn more about the listed companies. "You won't find hundred per cent perfect capital market anywhere across the globe. That's why only increased awareness can protect the investors' interest," he added. He made the comments while inaugurating a free-training session for share investors. State-funded Bangladesh Institute of Capital Market (BICM) organised the training at its office. The BICM, which is managed by the SEC, has planned to hold two training sessions each month for general investors free of charge. Professor Hossain said the regulator has rolled out a stimulus package to boost share trading, but confidence in the market depends has yet to see any major turnaround. "Restoring market confidence hinges on a number of factors including liquidity supply, proper co-ordination among the regulators and proper disposal of claims made by the investors. "The SEC has been working to boost investors' confidence by removing the gaps prevailing in these factors," he said. He admitted that some of the old rules and regulations needed overhaul in an effort to regulate the market more stringently. "The regulator has been working to bring some changes in the SEC Ordinance, 1969 and SEC Act, 1993 in a bid to make them time-befitting and for development of the capital market," he added. He said the trading system has seen some radical changes over the past few years, but the SEC needed more time to eliminate the loopholes in the existing rules and regulations. BICM Executive President Mohammad Abdul Hannan Zoarder spoke on the occasion.