FE Report-22.04.11 Friday
Nazmul Ahsan
The Securities and Exchange Commission (SEC) chairman has termed the report of the four-member probe committee on the recent share market scam as "biased, unsubstantiated and too, cruel".
No valid corruption charges have been made against the SEC officials, he wrote in an official letter to the authorities concerned.
In his first reaction to the 'probe body' report on the scam, the SEC Chairman Ziaul Haque Khondker has even raised the question about whether the committee members have any primary 'understanding' on the capital market.
"The suggestions of the probe committee show that it does not have any primary knowledge about the capital market," Zia said in a written reaction to the government last Monday.
Mentioning the allegation made in the report about the SEC being involved in any kind of share market syndication, the top boss of the commission said the allegation is nothing but a distortion of fact. He termed the allegation as 'inconsiderate' and 'biased' as the report sought to implicate a sensitive government organisation like the SEC for syndication without having any evidence.
"The probe report mentioned that manipulation in the share market scam took place probably because of direct connivance of the SEC with the so-called manipulators, implying that the members of the probe body are not themselves sure about any involvement of SEC officials in the recent share market scam as the report has mentioned the word 'probably'," Zia said in his clarification.
"The very intention of the committee is questionable as it made sweeping allegation against the SEC without being sure."
In his reaction, Zia said the criticism made in the report of the issue prices of Golden Son Ltd, Bay-Leasing and Marico is not based on facts, while the cases of Lanka Bangla and Unique Hotel mentioned in the report make no sense as none of the companies got the approval from the securities regulator.
He said the SEC made a lot of reforms in the capital market in the past several years like introduction of automation in the stock exchange and establishment of the central depository system and Bangladesh Institute of Capital Market.
Noting that the probe committee in its report blamed the SEC for its failure to discharge its duties properly, Zia observed such an allegation raised by the probe report is nothing but contrary to reality that demeaned the success of securities regulator in different areas.
The SEC chief said his institution tried its best to stabilise the market from the unusual bullish trend as it issued 81 directives and circulars in 2010 for the purpose. Pointing out his finger at Bangladesh Bank (BB), Zia said the share market debacle could have been averted if the BB had contained excess and beyond-limit investment of commercial banks and financial institutions in the share market during the period.
"The report has cleared the position of the probe committee having its felt towards the BB and its standing against the SEC by making its judgment against SEC without any valid evidence," Zia said referring to an allegation of the report that SEC did not respond positively after the BB had tried to sit with SEC for discussion on capital market.
He said the probe report made comments on 'Omnibus' accounts without reviewing the existing acts and regulations about the same.
The Omnibus account is very much lawful under the Depository Act, 1999, Zia clarified.
The SEC chief contradicted the allegation about the involvement of the SEC officials, as was noted in the report of the probe committee, in various irregularities involving private placements of shares. He took strong exception to the report for blaming the SEC officials for corruption without any evidence.
Zia said as the committee lacks in primary knowledge on capital market, it suggested not to issue any online news, relating to issuance of right shares before such shares are approved in the extra-ordinary general meetings of companies.
He said if the proposal of right issue is not made public after the immediate decision taken by the board of directors of a company, the scope for insider trading will be made open.
Asked about the letter, SEC Chairman Ziaul Haque Khondker denied to make any comment on his written reaction.
Khondker Ibrahim Khaled, head, probe committee, said, he would prefer not making any comment on the reaction of the SEC chairman.
"Now, it is the responsibility of the concerned authorities to examine the reaction of the SEC chief. I should not make any comment on it," Khaled told the FE.
Nazmul Ahsan
The Securities and Exchange Commission (SEC) chairman has termed the report of the four-member probe committee on the recent share market scam as "biased, unsubstantiated and too, cruel".
No valid corruption charges have been made against the SEC officials, he wrote in an official letter to the authorities concerned.
In his first reaction to the 'probe body' report on the scam, the SEC Chairman Ziaul Haque Khondker has even raised the question about whether the committee members have any primary 'understanding' on the capital market.
"The suggestions of the probe committee show that it does not have any primary knowledge about the capital market," Zia said in a written reaction to the government last Monday.
Mentioning the allegation made in the report about the SEC being involved in any kind of share market syndication, the top boss of the commission said the allegation is nothing but a distortion of fact. He termed the allegation as 'inconsiderate' and 'biased' as the report sought to implicate a sensitive government organisation like the SEC for syndication without having any evidence.
"The probe report mentioned that manipulation in the share market scam took place probably because of direct connivance of the SEC with the so-called manipulators, implying that the members of the probe body are not themselves sure about any involvement of SEC officials in the recent share market scam as the report has mentioned the word 'probably'," Zia said in his clarification.
"The very intention of the committee is questionable as it made sweeping allegation against the SEC without being sure."
In his reaction, Zia said the criticism made in the report of the issue prices of Golden Son Ltd, Bay-Leasing and Marico is not based on facts, while the cases of Lanka Bangla and Unique Hotel mentioned in the report make no sense as none of the companies got the approval from the securities regulator.
He said the SEC made a lot of reforms in the capital market in the past several years like introduction of automation in the stock exchange and establishment of the central depository system and Bangladesh Institute of Capital Market.
Noting that the probe committee in its report blamed the SEC for its failure to discharge its duties properly, Zia observed such an allegation raised by the probe report is nothing but contrary to reality that demeaned the success of securities regulator in different areas.
The SEC chief said his institution tried its best to stabilise the market from the unusual bullish trend as it issued 81 directives and circulars in 2010 for the purpose. Pointing out his finger at Bangladesh Bank (BB), Zia said the share market debacle could have been averted if the BB had contained excess and beyond-limit investment of commercial banks and financial institutions in the share market during the period.
"The report has cleared the position of the probe committee having its felt towards the BB and its standing against the SEC by making its judgment against SEC without any valid evidence," Zia said referring to an allegation of the report that SEC did not respond positively after the BB had tried to sit with SEC for discussion on capital market.
He said the probe report made comments on 'Omnibus' accounts without reviewing the existing acts and regulations about the same.
The Omnibus account is very much lawful under the Depository Act, 1999, Zia clarified.
The SEC chief contradicted the allegation about the involvement of the SEC officials, as was noted in the report of the probe committee, in various irregularities involving private placements of shares. He took strong exception to the report for blaming the SEC officials for corruption without any evidence.
Zia said as the committee lacks in primary knowledge on capital market, it suggested not to issue any online news, relating to issuance of right shares before such shares are approved in the extra-ordinary general meetings of companies.
He said if the proposal of right issue is not made public after the immediate decision taken by the board of directors of a company, the scope for insider trading will be made open.
Asked about the letter, SEC Chairman Ziaul Haque Khondker denied to make any comment on his written reaction.
Khondker Ibrahim Khaled, head, probe committee, said, he would prefer not making any comment on the reaction of the SEC chairman.
"Now, it is the responsibility of the concerned authorities to examine the reaction of the SEC chief. I should not make any comment on it," Khaled told the FE.
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