Loading...

The Bangladesh Securities and Exchange Commission has cancelled investigation against Bangladesh RACE Asset Management.

 The commission issued an order in this regard on February 13, which scrapped its previous order issued on June 24, 2024 for investigating the overall affairs of the company.

 As the investigation order was withdrawn, each disciplinary action against the firm mentioned in that order has also been cancelled.

 Rezaul Karim, spokesperson and executive director of the BSEC, told New Age that the decision to withdraw the enquiry order was made due to two related cases currently pending in the High Court.

After the court gives its verdict on these cases, we will take actions based on the decisions,’ he said.

Probe, against, RACE, Asset Management, cancelled, Dr. Hasan Taher Imam, RACE, asset manager, ensures, BSEC, approximately, Tk, 700 crore, investment, BO accounts

 On June 24, 2024, the BSEC found that Bangladesh RACE Asset Management PCL had opened and maintained multiple beneficiary owners identification accounts in different brokerage houses instead of keeping securities under the custody of an approved custodian as per the Mutual Fund Rules, 2001.

The brokerage houses included Multi Securities and Services Limited, The Smart Trades Limited and Trust Bank Securities Limited.

This raised concerns about asset security and proper management of mutual funds.

To protect investors, the BSEC ordered the suspension of transactions from these accounts and directed trustees and custodians to take control of the funds.

Later on July 4, 2024, further investigations revealed that Bangladesh RACE Asset Management PCL was conducting large-scale block transactions between and among funds under its management.

Some of these transactions also involved the Bangladesh Fixed Income Investment Special Purpose Vehicle, which was also under the control of Bangladesh RACE Asset Management.

Most of such block transactions were conducted through Multi Securities and Services Limited.

The BSEC found this practice a violation of the Mutual Fund Rules, 2001 that prohibit asset managers from transferring securities between mutual funds under their management.

To prevent potential financial misconduct, the commission suspended all block transactions involving the company and required detailed compliance reports and required detailed reports from all concerned parties.

 RACE managing director Hasan Taher Imam and the then chairman Chowdhury Nafeez Sarafat bought Multi Securities and Services allegedly through public money invested in mutual funds managed by their RACE Asset Management Company at significant higher rates compared with the market prices, BSEC officials said last year.