BSEC to suspend Firstlead Securities operations
The stock market regulator has decided to suspend the stockbroker or dealer certificate of Firstlead Securities Ltd at Chittagong Stock Exchange until further notice.
The Bangladesh Securities and Exchange Commission (BSEC) made the decision in its meeting on Wednesday.
The commission said Firstlead Securities has failed to pay its customers properly. Besides, the brokerage firm also did not pay the financial penalty of the commission.
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The CSE will take legal steps against the brokerage firm and inform the commission within 15 days.
Firstlead Securities was found in a November 2017 inspection violating securities law in five counts and it will have to pay Tk2 lakh in fines.
The CSE inspection team found the firm maintaining no updated account books and other documentation, allowing its authorised representatives trading securities in his own account, running consolidated customer bank account in deficits along with transferring money to own dealer account from the account, and also maintaining more than one consolidated customer bank account — all are violations of rules.
Firstlead Securities also violated the 1987 rule on maintaining risk-based capital adequacy ratio of 1:20 which says a broker's liability should not cross 20 times its capital.
The firm also provided its directors and executives with margin loans, another gross violation of the BSEC rule.
