BSEC initiates “special investigation” into Haji Ahmed Brothers Securities

The securities regulator has ordered a “special investigation” into Haji Ahmed Brothers Securities Ltd, saying the move is aimed at safeguarding the capital market and protecting general investors.

Md Abul Kalam, spokesperson of the Bangladesh Securities and Exchange Commission (BSEC), told The Financial Express that the regulator has already identified irregularities at the brokerage firm, but a further inquiry is necessary before taking any decision on licence cancellation.

“Before cancelling the licence, another investigation is required. We will disclose our findings, and the firm will be given an opportunity to defend itself,” he said, without specifying the nature of the irregularities.

Sources said the BSEC had earlier planned to cancel the licence of Haji Ahmed Brothers Securities Ltd over multiple allegations. However, the special investigation has now been initiated to collect evidence and conduct a thorough evaluation.

Recently, the BSEC’s Market Intelligence and Investigation Department issued a formal order to this effect, which has also been served on the managing director or chief executive officer of the Dhaka Stock Exchange (DSE) member firm.

In the order, the BSEC said the decision was taken under Section 17A of the Bangladesh Securities and Exchange Commission Act, 1993, and Rule 12(3) of the Securities and Exchange Commission (Stock-Dealer, Stock-Broker and Authorised Representative) Rules, 2000.

A three-member investigation committee has been formed and instructed to submit its report within 30 working days from the issuance of the order late last month.

The committee includes BSEC Deputy Director Shahriar Parvez, Assistant Director Kulsum Akhter and Assistant Director Mohammad Saidul Islam.

It will review the overall operational condition of Haji Ahmed Brothers Securities Ltd, assess compliance with securities laws and regulatory requirements, and determine whether cancellation of the broker’s licence is warranted.

“If any discrepancies or violations are found, the commission will take appropriate action,” the BSEC spokesperson said.

Raquib Md Fakhrul currently serves as managing director of the firm, while Ayesha Dada is its chief executive officer. Fakhrul declined to comment when contacted by The Financial Express.

Haji Ahmed Brothers Securities Ltd is a sister concern of the Munshi Group, a conglomerate owned by the late AFM Fakhrul Islam Munshi, an Awami League advisory council member and former deputy minister.

Market participants said the BSEC has recently tightened oversight of brokerage houses to enhance financial transparency and investor protection. As part of this drive, the regulator has intensified inspections, inquiries and investigations.

They noted that failure to protect clients’ funds and securities can seriously erode investor confidence.

The securities commission, reconstituted after the political transition in August 2024 and now chaired by Khondaker Rashed Maqsood, has adopted a stricter approach toward brokerage firms facing shortfalls in consolidated customer accounts.

According to the BSEC, heightened regulatory scrutiny is part of a broader effort to restore market discipline and hold institutions accountable, stressing that irregularities and investor-unfriendly practices will not be tolerated in the capital market.