No cash withdrawal from investor accounts: BSEC
Instead, they will have to withdraw funds through banking channels so that the withdrawals are traceable
Brokerage firms will not be able to withdraw cash from their consolidated customers' accounts (CCAs) where they deposit investors' funds.
Instead, they will have to withdraw funds through banking channels so that the withdrawals are traceable.
The Bangladesh Securities and Exchange Commission (BSEC) has recently directed the stock exchanges, brokerage firms, and banks in this regard.
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The commission also informed the Bangladesh Financial Intelligence Unit (BFIU) of the Bangladesh Bank about the move.
In December last year, Tamha Securities was in the news for allegedly embezzling Tk140 crore from its CCAs. The firm had been withdrawing investors' funds since 2013 in order to close transactions.
Crest Securities and Banco Securities have also allegedly embezzled Tk48 crore and Tk70 crore respectively in the same way.
Thus, in a move to prevent such fraudulent activities from happening in the future, the BSEC made this decision.
According to sources, if the firms use the banking channel, any fund withdrawal will be traceable and investors' money will remain safe.
As per the regulatory notification, every stockbroker maintains a CCA in its name with a scheduled bank for depositing money received from its customers, and also for paying money to them.
Besides, all money received from customers shall be deposited in that account on the day of receipt.
Richard D' Rozario, president of DSE Brokers Association, said the regulator can take legal action against those brokerage firms who don't comply with the rules.
But it should keep provision nominally for humanitarian reasons and emergency basis as in case of emergencies, the investors might submit requests suddenly, he added.
