PFI Securities gets 6 more months to adjust Tk25cr clients’ account deficit
The company has until 30 June 2024 to adjust the total deficit
The stock market regulator has allowed brokerage house PFI Securities Limited a time extension of six months to adjust the Tk25 crore deficit in its consolidated customers' account (CCA).
According to the Dhaka Stock Exchange (DSE), the deficit in the company's CCA was Tk33 crore.
Md Nuruzzaman, assistant vice president (AVP) at PFI Securities, told TBS that the company adjusted Tk8 crore of the deficit last year. Now, the deficit amount is Tk25 crore.
"We received the commission's letter regarding the time extension. We're trying to adjust the deficit as soon as possible."
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"The brokerage house has assets worth more than Tk1,000 crore including lands and buildings. We're trying to use our assets to replenish the customers' account within a month or two," he added.
The firm's Managing Director Kazi Fariduddin Ahmed did not respond to the phone calls for a comment.
The brokerage house has assets worth more than Tk1,000 crore including lands and buildings. We're trying to use our assets to replenish the customers' account within a month or two. Md Nuruzzaman, AVP, PFI Securities Brokerage - Bangladesh
The company has until 30 June 2024 to adjust the total deficit.
The CCA is basically a separate bank account stockbrokers maintain to park the cash lying idle in the beneficiary owners' (BO) accounts of their clients. The brokerage house is prohibited to use the money for other purposes than paying the price of the securities the very client buys, or collecting the commission or fees payable by the client.
In the recent past, many cases of brokerage firms embezzling their clients' funds were unveiled.
After that, the Bangladesh Securities and Exchange Commission (BSEC) took a zero tolerance approach against such misappropriation of clients' funds by stockbrokers.
The BSEC slapped fines on some brokers, while others were directed to adjust deficits within stipulated time.
Brokerage firms that failed to adjust deficits were given some conditions by the BSEC, which helped reduce the deficit amount, according to DSE officials.
In March 2022, the BSEC said if CCA deficits linger, stockbrokers will be deprived of their free trading limit in the bourse, their quota in initial public offerings, and dividends from the stock exchange they hold shares of.
Renewal of brokerage licence, and new branch or digital booth opening will also remain unapproved until the CCA deficit is adjusted.
PFI Securities at a glance
Incorporated in 1997, PFI Securities is a stock dealer and brokerage company registered as a member with both Dhaka and Chattogram bourses.
It is an associate company of non-bank financial institution (NBFI) Prime Finance and Investment, which owns 46.15% stake in PFI Securities.
In November last year, the Central Depository Bangladesh Limited (CDBL) suspended the depository participation (DP) operations of PFI Securities.
The suspension was due to failure to pay the fees for CCA clearance and DP registration renewal.
But the stock broker paid renewal fees immediately after the letter issuance, resulting in no disruption on shares transactions.
In 2018, the BSEC fined PFI Securities Tk25 lakh for CCA deficits and irregularities in stock market investments.
