BSEC fines Tk2.36cr to Shakib, associates for share manipulation

The Bangladesh Securities and Exchange Commission (BSEC) has imposed fines totalling approximately Tk2.36 crore on eight individual investors, including cricketer Shakib Al Hasan and Md Abul Khayer Hiru, as well as four institutions, for manipulating the share price of Crystal Insurance Company Ltd. 

The BSEC found that the offenders artificially inflated the company's share price, disrupting fair trading in the stock market.

In addition, the regulatory body has issued warnings to Al-Amin Chemical Industries Ltd, Sonali Paper Board Mills Ltd, and NRBC Bank for their involvement in the manipulation of Crystal Insurance shares. This decision was finalised by the commission last month.

The following individuals have been penalised for their role in price manipulation: Kanika Afroze Tk49 lakh; Md Abul Khayer Hiru Tk37 lakh; Kazi Sadia Hasan Tk13 lakh; Abul Kalam Matbor Tk3 lakh; Shakib Al Hasan Tk3 lakh; Humayun Kabir Tk3 lakh; Md Zahed Kamal Tk2 lakh; and Md Ashfaquzzaman Tk1 lakh.

Along with the individuals, four institutions have also been fined: Ishal Communication Ltd Tk85 lakh; Monarch Express Tk22 lakh; Monarch Mart Tk15 lakh; and Lava Electrodes Industries Tk3 lakh.

These penalties were imposed based on an inquiry report, with BSEC emphasising that such actions violate market regulations and harm investor confidence. 

The commission reiterated its commitment to ensuring transparency and maintaining discipline in the capital market.

Yesterday, Crystal Insurance's share price closed at Tk45 on the Dhaka Stock Exchange.

This is not the first time Shakib, Hiru, and their associates have faced penalties for share manipulation. The BSEC has previously fined them for inflating the shares of other listed companies, disrupting market fairness and breaching securities regulations.

The price of Crystal Insurance's shares rose significantly between 16 July and 21 September 2023, from Tk45 to Tk132.50 – a 194% increase – despite no material information to justify the spike. 

The BSEC's investigation revealed that the manipulators engaged in coordinated transactions within their network, creating a false impression of high demand for the shares, even in a declining market. They used multiple brokerage firms and several Beneficiary Owner (BO) accounts to artificially drive up the price.

The company's 2024 statement revealed a net income of Tk24.76 crore, up from Tk19.61 crore the previous year, and a 12% cash dividend for shareholders. The earnings per share stood at Tk3.13, compared to Tk2.77 a year earlier.

As of February 2025, the shareholding structure of Crystal Insurance is as follows: Government 58%; institutional investors 12.77%; foreign investors 0.05%; and general investors 29.18%.