Brokers get four months to migrate to uneditable back-office software
Upon approval from the securities regulator, the Dhaka Stock Exchange (DSE) has allowed its brokerage firms four extended months to migrate to uneditable back-office software.
All brokers must install and start using regulator-outlined, uneditable back-office software by 30 April 2025, DSE said in a letter to the firms today, adding that failure would result in detachment from trading activities on 1 May, alongside some regulatory punishments.
The entire migration from the present editable systems to uneditable ones must be accomplished by 30 April, the DSE clarified.
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"We requested to extend the deadline, mainly to allow the vendor firms some time for a smoother supply and services," said DSE Brokers' Association President Saiful Islam.
Even though it will add to the costs in a dull market, all the DSE brokers will migrate to the new back-office software system in time, he added.
Back-office software is used for the brokerage firms' internal operations that include detailed information on transaction balances with clients and other parties.
A very few brokerage firms, including Tamha Securities, years later were found to have been maintaining multiple sets of back-office software. Despite their embezzlement of client assets, they were disclosing fake data on the software to hide the embezzlement.
The fraudulence fooled regulators, as well as the clients.
The Bangladesh Securities and Exchange Commission (BSEC) then came up with the plan to compel all brokers using uneditable back-office software to be provided by any of the eight vendor firms qualified for regulatory screening.
In the new system, one cannot edit data on a back date, and that would help prevent Tamha-like faking of software-maintained information, said DSE officials.
United Corporate Advisory Services, Orange Solutions, Cygnus, LeadSoft Bangladesh, LankaBangla Information System, DataSoft Systems, AdaSoft International, and IDLC Securities are in the BSEC-approved panel of vendors.
According to the regulatory plan, the stock exchange will closely monitor brokers' back-office systems and take immediate action in the event of any irregularities.
