Salman F Rahman was the man behind the stock market's debacle in 1996 and 2010.
Two cases were filed against him over scams linked with Shinepukur Holdings and Beximco Pharmaceuticals.
Both the cases were quashed by the High Court (HC). The securities regulator later appealed against the HC orders. The appeals still remain pending before the appellate division.
After the 2010-11 stock market debacle a probe body led by Khondker Ibrahim Khaled did not bring any specific allegation against Mr Rahman.
Mr Rahman has escaped regulatory actions, leveraging political and economic influence. Now, the newly-formed commission, having promised to remove corrupt practices from the market, opened up an inquiry against Mr Rahman, his family members and his companies.
At the same time, S Alam Group Chairman Mohammed Saiful Alam, who enjoyed impunity under the Sheikh Hasina-led government even after illegally taking control over several banks and laundering money from them, has come under an investigation. Mr Alam's wife, children and other relatives will also be probed.
A four-member panel will have to submit a report in 60 days.
The Bangladesh Securities and Exchange Change (BSEC) said the regulator formed the panel to probe into the allegations against Mr Salman and Mr Saiful, made in media reports.
Mr Rahman and Mr Alam were trusted people of former PM Sheikh Hasina until her downfall on August 5.
Meanwhile, the Anti-Corruption Commission (ACC) has been investigating separately their illegal means of wealth accumulation since the ouster of the Hasina-led government.
Recently, the securities regulator froze the beneficiary owners' (BO) accounts of Mr Rahman and Mr Alam on recommendation of the ACC.
Mr Rahman's being close to power
"Salman is one of the top loan defaulters since the 1980s, who was known for using his influence and bending rules to get bank loans for Beximco Group," said the BSEC in a statement issued on Monday, quoting media reports.
When the Awami League-led government came to power in 2009, Beximco Group had its companies' names dropped from the list of defaulters by misusing political power.
Beximco got its defaulted loans rescheduled on many occasions by compelling the regulators to make or amend rules. It also shielded itself from legal peril by securing court orders in its favour.
The toxic malpractices encouraged other businesses to borrow and never repay, exposing Bangladesh's banking industry to serious risks.
Preferring anonymity, a member of the previous Ibrahim Khaled-led committee said they were unable to pinpoint wrongs committed by Mr Rahman due to the non-cooperation of the market operators.
Even the stock exchanges refrained from providing information.
"Different focus groups gave hints about Rahman's involvement in scams. But they did not provide any information," said the member of the 2010 probe committee.
After the submission of the report, the then finance minister Abul Mal Abdul Muhith, who had vowed to take stern actions against market manipulators, retreated from his position.
The investigators were harassed and cases were filed against them by unscrupulous persons, said the member of the 2010 probe committee, requesting anonymity.
Market insiders said a large number of investors had endured losses after purchasing placement shares of Salman's GMG Airlines. The company did not float any IPO (initial public offering) to create any exit for those shareholders.
Moreover, there are widespread allegations against Mr Rahman of not settling investors' claims in time against some debentures issued in the 1990s by his companies.
Market insiders say Mr Rahman is infamous for establishing an ill structure of merger and acquisition. The merger of Padma Textile and Padma Printers with Beximco was an example of that.
They say Rahman held huge volumes of shares of Beximco through unknown holding companies. The companies injected fresh funds to create artificial demand for the shares of Beximco. Credit facilities were also utilised to influence share price.
Insiders also allege that before the 2010-11 stock market debacle, Mr Rahman influenced the share price of his companies by spreading rumours.
Saiful Alam's seizure of banks
Islami Bank was the best performing bank in the country just a decade back. The bank had surpassed all other banks in the country in terms of deposits, loan recovery and other crucial indicators.
The Chattogram-based business giant S Alam Group forcefully took control over the bank in 2017, leveraging its political connection with the then Awami League-led government.
S Alam Group and its sister concerns have reportedly taken around Tk 500 billion in the last seven and a half years in violation of banking rules, making Islami Bank suffer from a severe liquidity crisis.
The amount of money lent to S Alam Group is equivalent to one-third of the total loan disbursement by Islami Bank. Loans were taken in the name of known and anonymous persons and entities. Even new companies were created to take loans in their name, said BSEC, quoting a media report.
Loans were also granted to S Alam Group Chairman Mohammed Saiful Alam, his wife, daughter's husband, and employees.
Some bank officials believe that the actual amount of money laundered from the bank is even higher than what has been revealed so far.
As a result, once a good bank gradually fell into a major liquidity crisis. The bank has been running operations by utilising the central bank's special liquidity support.
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