Trillions Embezzled from Stock Market Under Hasina Regime: White Paper Analysis
Trillions of takas were improperly taken from the stock market during Sheikh Hasina’s time, according to the findings of a White Paper examining the state of the economy. The report was just handed over to Chief Adviser Professor Muhammad Yunus by committee chair, economist Debapriya Bhattacharya.
The White Paper suggests that excessive government involvement restricted responsible institutions, leading to a culture of fraud and speculation. Weakening laws and regulations allowed weak companies to enter the market through flawed IPO processes.
The report also points out a network of manipulation involving key players like entrepreneurs, auditors, and specific investors. Shockingly, even officials of the Bangladesh Securities and Exchange Commission (BSEC) may have played a role by taking advantage of legal loopholes.
The White Paper notes some flaws in the market system. For instance, IPO valuations often favor sponsors, disadvantaging regular investors. Settlement delays, lack of central clearing, and inadequate IT infrastructure pose risks and hinder transparency in trading.
Market manipulation is a major concern, with powerful investors artificially boosting share prices and allegations of mishandling mutual funds. Allegedly, top institutions in the mutual fund sector were involved in wrongdoing, damaging investor trust.
BSEC’s actions, such as extending closed-end mutual funds’ durations, shook investor confidence and caused stock market fluctuations. Increased margin loan ratios added fuel to the fire, prompting regulatory changes.
The findings suggest a need for better oversight and market transparency to prevent such incidents in the future. Stay tuned for more updates on this evolving story.
