BFIU halts banking transactions of 12 RACE-managed mutual funds
BFIU sources told The Business Standard that its action was a response to a letter from the Bangladesh Securities and Exchange Commission (BSEC)
The Bangladesh Financial Intelligence Unit (BFIU) has ordered all the scheduled banks of the country to halt all banking transactions by the 12 mutual funds being managed by the Bangladesh RACE Management.
The order issued on 10 June was for 30 days, which means the bank accounts of the mutual funds will remain frozen till 9 July, according to the BFIU.
BFIU sources told The Business Standard that its action was a response to a letter from the Bangladesh Securities and Exchange Commission (BSEC).
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Earlier on 6 June, the capital market regulator halted block transactions of any securities held by the mutual funds managed by RACE, the largest private sector asset manager.
The BSEC's action was based on a recommendation from its investigation committee, which was recently formed to scrutinise things within the mutual funds being managed by Race.
BSEC officials said RACE Managing Director Hasan Taher Imam has been fighting two separate legal battles – one case filed in November by a mutual fund investor named Ruhul Amin Akand, alleging that Imam embezzled public investors' money; and the other case filed by RACE Chairman Chowdhury Nafeez Sarafat.
RACE manages ten closed-end mutual funds – EBL First, Trust Bank First, IFIC Bank First, First Janata Bank, Popular Life First, PHP First, EBL NRB, AB Bank First, Exim Bank First, First Bangladesh Fixed Income Fund; and two open-end funds – RACE Financial Inclusion Unit Fund and RACE Special Opportunities Unit Fund.
Total assets under RACE were over Tk3,000 crore, according to the BSEC.
