Body formed to probe Fu-Wang Food’s suspense BO account
The panel has been asked to submit its report within the next 30 working days
In order to protect the interests of investors, the Bangladesh Securities and Exchange Commission (BSEC) has formed a committee to investigate the suspense BO account of Fu-Wang Food Ltd.
Usually, a listed company preserves the unclaimed dividends of its investors in a suspense BO (beneficiary owner) account.
The two-member committee consists of BSEC Deputy Director Md Sirajul Islam and Central Depository Bangladesh Limited (CDBL) Senior Executive Shafaet Ahmed Siddique Shurid.
The probe panel has been asked to submit the report within the next 30 working days.
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Sources at BSEC said it is alleged that the company has illegally transferred the shares of the suspense BO account to directors' accounts illegally.
The commission had earlier nominated five independent directors for the company.
The independent directors will report monthly to the commission regarding the operation status of the company and the compliance regarding various issues.
According to BSEC, sponsors and directors of the company jointly hold 9.86% shares of the paid-up capital and thus failed to comply with the 30% shareholding rules of the commission.
Fu-Wang Food Ltd was supposed to reshape its board within 45 working days as per the rules, but the company failed to comply with the regulation.
The company and its board of directors did not appoint two additional directors and also violated the condition of BSEC.
Earlier in a preliminary inquiry, the commission had found that the company made huge transactions with related parties and family members without proper disclosures to the market.
The inquiry committee reported that the company has been siphoning off the profit of Fu-Wang Food Ltd by overstating the value of assets and expenses, understating the reported revenue and profit and using manufacturing financial reporting, which is a violation of laws.
Moreover, the company is not appropriately growing and its shareholders are getting fewer dividends for the last two years, which is detrimental to the interest of the investors and undesirable to the commission.
The company got listed on local stock exchanges in 2000.
In the first nine months of last fiscal year, the revenue of the company was Tk59.21 crore and profit Tk2.86 crore.
