Louthful Goni Tito fined for manipulating shares

The Bangladesh Securities and Exchange Commission (BSEC) has fined Louthful Goni Tito and his associates Tk25 lakh for manipulating Global Insurance Company's shares.

According to BSEC sources, Tito and his associates traded a significant number of shares of Global Insurance among themselves through three beneficiary owner (BO) accounts from 1-21 August 2019.

During this time, 54.39% of the total transactions of the company's shares were done through these three accounts. This created an artificial demand for the shares. As a result, the share prices rose to an unusual high.

Cashing in on this, Tito and his associates logged a profit of more than Tk1 crore by selling 44 lakh shares against the purchase of 30.66 lakh shares from these three BO accounts.

Thus, Tito and his associate violated the securities rules by trading among themselves to influence the stock price increase, the sources added.

On 14 December, the stock market regulator sent two letters convening the penalty order to Tito and Shatrong Agro Fisheries, where he is the managing director.

The letter mentioned Tito and his associates – spouse Shammi Neawaz and Shatrong Agro – maintain three BO accounts.

Tito and his wife's BO accounts are with Multi Securities, and Shatrong's account is with EBL Securities.  

At a BSEC hearing, Louthful Goni Tito defended his action.

"I am an authorised representative of those accounts. Unintentionally and without my knowledge, a related account holder acted as both buyer and seller a few times," he added.

He also offered an unconditional apology for creating such inconveniences for the BSEC.

Earlier in 2020, BSEC warned Tito about violating securities laws. He then signed an undertaking not to violate the law in the future.