ACC conducts raid at BSEC over allegations of corruption and irregularities

The Anti-Corruption Commission (ACC) conducted a raid at the Bangladesh Securities and Exchange Commission (BSEC) yesterday (2 March) following allegations of corruption and irregularities in the regulatory body's operations.

The enforcement team scrutinised documents related to initial public offering (IPO) approvals, including application lists, prospectuses, audit reports, and other relevant records submitted by companies, as well as the final approval lists, according to an ACC statement.

Simultaneously, another ACC team collected information and documents related to Beximco Sukuk and IFIC Amar Bond, both linked to Salman F Rahman, as per an ACC source.

The preliminary review revealed that IPO approvals were granted based on fabricated earnings and asset statements, as well as window-dressed balance sheets submitted by companies. 

In numerous instances, the recommendations and observations of the Dhaka Stock Exchange (DSE) were disregarded, facilitating widespread irregularities, said ACC in a statement.

The ACC team also identified that the BSEC failed to take appropriate action in cases involving private placement fraud, inflated share prices at market entry, rapid share sales, and subsequent price collapses. 

They also found that several weak companies were allegedly approved for IPOs illegally and later downgraded to the low-performing Z-category shortly after entering the capital market.

According to the ACC, the team's initial findings suggest that IPOs were approved based on manipulated balance sheets, fabricated earnings reports prepared by chartered accountants, and overvalued company profiles prepared by issue managers. 

These irregularities were allegedly overlooked during the approval process.

The ACC stated that the team will continue to review the necessary records and submit a comprehensive report to the commission detailing the irregularities uncovered during the investigation.