Intelligence clearance must for appointing merchant banks’ MDs, CEOs

An intelligence agency clearance certificate will henceforth be required in order to get approval for appointment as managing director or chief executive officer of a merchant bank.  

Before approving the candidate, the Bangladesh Securities and Exchange Commission (BSEC) will have to get a clearance from the National Security Intelligence about the person.

The securities regulator recently received an office order from the Bangladesh Bank's Anti-Money Laundering and Combating Financing of Terrorism unit for the implementation of the market entry control mechanism. 

A police or intelligence clearance certificate has to be taken from the relevant intelligence agency to approve the appointment or reappointment of managing director or chief executive officer for a Trec holder, stock dealer, stockbroker, asset manager, security custodian, merchant banker, and portfolio manager.
 
Also, such companies will need to get a police verification clearance from police or any of the relevant intelligence agencies to get a license or to renew it. 
 
The securities regulator will also have to keep the Anti-Money Laundering and Combating Financing of Terrorism unit posted every month on what clearances have been given. 
 
However, according to the securities law, only the BSEC can approve the appointment of a managing director or chief executive officer of merchant banks. For this, the BSEC takes clearance from the Bangladesh Bank's Credit Information Bureau. 

The BSEC Executive Director and Spokesperson Md Saifur Rahman told The Business Standard, "While approving the appointment of managing director or chief executive officer of merchant banks, we will get verification from the relevant intelligence agency from now on. Our concerned department is supposed to send letters to the merchant banks in this regard."

The president of the Bangladesh Merchant Bankers Association, Md Sayadur Rahman, told The Business standard, "The BSEC might have taken this decision to prevent money laundering and terror financing. But we are yet to get any formal letter from the regulator."
 
"Earlier, the companies' board would select the top official and send the name to the BSEC for approval. Then, the regulator would verify the official's information. But, the new decision is not clear to us."