Conned investors to get 15.6% against lost money from protection fund

Defrauded customers of the four brokerage firms will receive 15.65% against their lost money from the investor protection fund of the Dhaka Stock Exchange (DSE).

In other words, an investor who had a Tk100 investment will get Tk15.65 from the protection fund.

After receiving a sea of complaints, the DSE has deemed 8,581 claimants, with a total claim amount of Tk198 crore, eligible for reimbursement from the protection fund.

But for now as a contingency measure, the DSE will disburse Tk25 crore, which is around one-eighth of the total claim, on a pro rata basis.

The brokerage firms in question are Crest Securities, Banco Securities, Tamha Securities and Shah Mohammad Sagir & Company Limited.

The DSE, in a program on Monday, handed over cheques to two defrauded investors. Sultan Saiful Alam Lelin, who had a capital of around Tk1 crore, got back Tk17.16 lakh, and Mir Salauddin, who had a capital of around Tk67 lakh, received Tk10.51 lakh from the protection fund at 15.65%.

Earlier, the DSE had disbursed nearly Tk17 crore to 5,060 customers by selling shares that were on the clients' portfolios, said DSE officials.

"Returning money to defrauded investors from the protection fund is both pleasing and disappointing. Despite the presence of regulators, protection could not be ensured," Abdul Halim, commissioner of the Bangladesh Securities and Exchange Commission (BSEC), said in a program.

"When someone engages in irregular trading, it's closely monitored through surveillance. I've even seen embezzlers communicate with the top level. But now, they need to be caught and measures must be taken during the act of theft."

He said to the DSE officials, "No new regulations have been enacted regarding this. But there is no more embezzlement of funds. If you are vigilant at the beginning of irregularities, accidents will not happen."

"It's a mere facade and mockery to send out investigation orders after an unusual trade happens."

"We also share responsibility in these embezzlement incidents, which wouldn't have occurred in the first place if we had fulfilled our responsibilities properly."

"We are making efforts to collect funds from assets alongside paying from the protection fund," the BSEC commissioner said.

Dhaka bourse's Managing Director ATM Tariquzzaman said, "A message will go out in the market that we are working for the safety of investors. Even though to a small extent, we are able to provide them with security. Many investors have applied and after verification and selection, assistance is being provided to the ones who are genuine."

DSE Chairman Professor Dr Hafiz Md Hasan Babu said, "A journey has begun through providing funds from the protection fund. By providing these funds, we have been able to demonstrate, even on a small scale, that we are investor-friendly."