BSEC moves to investigate Salman, S Alam’s alleged wrongdoings

The Bangladesh Securities and Exchange Commission (BSEC) has finally initiated a formal probe into allegations of irregularities involving Salman F Rahman, and Saiful Alam Masud, widely known as S Alam.

The commission issued an order today (9 September), forming a four-member probe committee to investigate the alleged misconduct by Salman and S Alam. 

The order further stated that the committee would examine the involvement of the two businessmen, their families, and associated companies in capital market manipulation.

The committee has been instructed to submit its findings within 60 working days.

The regulatory body's move comes amid growing concerns over transparency and investor protection in the financial sector, according to the order.

The commission also cited a national daily newspaper, stating that Salman had been one of the top loan defaulters since the 1980s and was involved in the 1996 stock market crash. 

However, after the Awami League government came to power in 2009, companies affiliated with Salman's Beximco Group allegedly received special privileges and had their names removed from the defaulter list.

Additionally, Salman was named in the 2011 market crash inquiry report prepared by Khondkar Ibrahim Khaled.

Meanwhile, the BSEC notice stated that S Alam Group, with close ties to the Awami League government, gained control of several banks, including Islami Bank. The group reportedly siphoned off over Tk 50,000 crore illegally from Islami Bank alone, with the actual loan amount believed to be even higher.

Salman, vice-chairman of Beximco Group, served as a private and investment advisor to former prime minister Sheikh Hasina, who was ousted on 5 August amid widespread protests. Salman is currently in jail, facing charges related to multiple murder cases.

Meanwhile, Saiful Alam, the owner of the controversial business conglomerate S Alam Group, is reportedly living abroad.

On 1 September, the BSEC formed a probe committee to investigate past irregularities, manipulation, and corruption in the capital market, including issues related to Beximco Sukuk and Sreepur Township bonds linked to Salman F Rahman.

Beximco Limited raised Tk3,000 crore through Sukuk bonds to build two solar power plants and expand its textile business. However, Salman allegedly misused his power to issue and subscribe to Sukuk bonds.

Besides, Salman F Rahman secured a Tk1,000 crore bond guaranteed by IFIC Bank for his new real estate venture – Sreepur Township Limited (STL) – months before the last national election. Salman was the chairman of IFIC Bank.

On 20 August, the BSEC ordered the country's stock exchanges and the Central Depository Bangladesh Limited to freeze the shares of six banks held by S Alam and his associates.

The order came after the central bank asked the securities regulator to freeze their shares at Islami Bank Bangladesh, First Security Islami Bank, Social Islami Bank, Global Islami Bank, Union Bank, and Bangladesh Commerce Bank so that they cannot buy, sell or transfer the shares without prior approval.

S Alam is accused of using corruption and influence over regulators and government agencies to take control of several banks, including six major ones, and syphon billions of dollars in depositors' money through fraudulent loans. 

During Sheikh Hasina's regime, no supervisory body or official questioned his actions.

According to the Dhaka Stock Exchange (DSE), the shares of the six listed banks are worth over Tk2,900 crore at present market value, as revealed in the instant screening.

After the ousting of the Hasina-led government, the Anti-Corruption Commission (ACC) also launched an investigation against Salman and S Alam for allegedly acquiring illegal wealth. 

According to ACC sources, several media outlets have reported how Salman and S Alam used their influence to launder thousands of crores of taka that they accumulated through corruption.

The Criminal Investigation Department also started an investigation against them for allegedly laundering around Tk2 lakh crore under the Money Laundering Prevention Act 2012.