Crores lost to AGM party extortion, BAPLC calls for action

Infographic: TBS

Every year, crores of taka are reportedly exchanged illegally around the annual general meetings (AGMs) of publicly listed companies in Bangladesh, with organised groups of investors allegedly extorting money from companies in exchange for allowing meetings to proceed smoothly. 

These groups, widely referred to in the market as "AGM parties," are accused of creating deliberate disruptions and exerting pressure to extract financial benefits. Video footage from multiple AGMs shows evidence of such behaviour.

On 26 January, TBS Multimedia published an investigative report highlighting the extortion practices surrounding AGM parties.

Following the report, the Bangladesh Securities and Exchange Commission (BSEC) and the Bangladesh Association of Publicly Listed Companies (BAPLC) reportedly decided to take strict measures. BAPLC sent a letter, signed by its president, to all listed companies instructing them not to provide any unethical benefits to AGM parties. 

The letter also requests companies to submit the names of individuals demanding such benefits, along with evidence, to BAPLC.
Crores Exchanged to Avoid Disruption

"We are aware of AGM party activities, but no formal complaints have been received. Companies must file complaints first, and we will take strict action." BSEC spokesperson Abul Kalam

BAPLC President Riad Mahmud told The Business Standard that AGM parties have become an ongoing problem. "Each year, these groups demand money from companies in an unethical manner. If the companies refuse, they threaten to disrupt the AGMs. To avoid such disruptions and embarrassment, many companies end up providing financial benefits, sometimes running into several crores of taka."

Mahmud added that BAPLC had informed the BSEC about AGM parties, and the regulator advised companies to take legal action and file written complaints. He said BAPLC would soon take legal steps to curb AGM party activities.

Key individuals allegedly leading AGM parties

One of the alleged AGM party leaders is Shah Alam Babu, a general investor who appears in video footage from several AGMs this year. In some meetings, he was seen attempting to disrupt proceedings; in others, he reportedly stood on the dais making irrelevant statements to waste time.

At the AGM of Mir Akhter Hossain Limited for the 2024–25 fiscal year, footage shows Shah Alam Babu allegedly grabbing the coat of a company official. At another AGM of Sharp Industries Limited, he reportedly made incoherent and disruptive remarks. Several company officials told TBS that certain groups routinely exert pressure both before and after AGMs, sometimes staying in offices for hours to demand payments.

Shah Alam Babu, however, denied the allegations. He initially claimed he did not attend AGMs, later stating he never disrupted meetings or physically confronted anyone. His statements, however, do not align with the video evidence.

Another alleged AGM party leader is Selim Reza, who identifies himself as the president of the Bangladesh Share Investor Association. At the National Feed Mills Limited AGM for the 2023–24 fiscal year, he was seen making incoherent statements. The meeting, which began at 11:30am, extended for more than eight hours due to repeated disruptions. During a break around 1:00pm, Selim Reza was reportedly taken to a room by company Managing Director Akhter Hossain Babul, accompanied by several individuals.

In his closing remarks, Babul publicly alleged that some attendees demanded money from him, claiming he had written records of names and amounts. He accused the group of obstructing the AGM because he refused to comply. 

Following the incident, National Feed Mills Limited filed a general diary (GD) at Sreepur Police Station in Gazipur on 29 January, naming Selim Reza and three others in connection with extortion and threats.

Selim Reza was also seen leading disruptions at the AGM of Energy Pac Power Generation Limited for the 2024–25 fiscal year. When asked about allegations of extorting money, he denied wrongdoing, claiming neither he nor his associates accept unethical benefits, and requested that reporters identify those who do. Observers noted that he often criticises corruption during previous governments but avoids addressing allegations against himself.

More groups remain active

Sources told TBS that other groups, including one led by Riaz Khan who identifies as vice-president of the Bangladesh Capital Market Investors Club are also involved in similar practices. Attempts to contact him were unsuccessful.

Under regulations, listed companies must submit video footage of AGMs to the BSEC within three working days. These videos are meant to be reviewed by the regulator. However, despite repeated incidents, the BSEC has not taken visible action against AGM parties.

BSEC spokesperson Abul Kalam told TBS that the commission is aware of AGM party activities but has yet to receive formal written complaints from companies. 

He added that companies facing disruptions must take the first step by filing complaints and pursuing legal action. "Once companies submit written complaints, the commission will take strict measures," he said.