Home ›› 02 Aug 2022 ›› News
Standard Insurance, a listed company, embezzled Tk 5.69 crore in 2020, revealed the draft report of an investigation by the Insurance Development and Regulatory Authority (IDRA).
The investigation found that Tk 3.03 crore of the embezzled money came from premiums while the rest involved cheque dishonour.
Standard Insurance was also found to have evaded Tk 2.41 crore in VAT.
The company could not provide the IDRA investigation team with suitable explanations of the wrongdoings. The team then recommended legal action against it.
Md Abdul Matin Sarker, chief executive officer of Standard Insurance, told The Business Post he was not aware of the matter as he was abroad during the investigation. He suggested talking to the company secretary about it.
The secretary, Mohammed Kowser Munshi, declined to comment, saying he was not aware of the investigation report.
Premium embezzlement
The company’s 2020 annual report said deposit premium was Tk 3.03 crore, but this was not shown as income in the report. The investigation team said in its report the money had been embezzled.
Cheque dishonour
The IDRA act says an insurer is required to issue insurance money receipts and cover notes to clients after depositing premiums in the bank.
But Standard Insurance violated the law and was involved in Tk 2.66 crore cheque dishonour in 2020, the investigation report said.
It also said the company’s explanation of why a Tk 2.66 crore cheque was bounced was not acceptable.
VAT evasion of Tk 2.41 crore
The company was supposed to pay Tk 7.27 crore in VAT in 2020, but it paid Tk 4.86 crore.
The probe team asked for Tk 2.41 crore VAT exemption documents, but the insurer could not provide that.
The company’s financial condition
The 2021 annual report said Standard Insurance’s net premium income rose by 14.43 per cent to Tk 3.33 crore from Tk 2.91 crore in 2020.
The company declared 13 per cent cash dividends for 2021, which amounted to Tk 5.62 crore.
It had assets of Tk 152 crore at the end of 2021. At present, it has Tk 124 crore invested in bonds, fixed deposits, and the stock market.
Capital market performance
Last year, the lowest price of the company’s share was Tk 46 each while the highest price reached Tk 104. Share prices fell by 0.39 per cent to Tk 50.5 on Dhaka Stock Exchange on Monday.
It has been paying cash dividends since 2019. Before that, it used to pay stock dividends regularly.
The current market capitalisation of Standard Insurance is Tk 212 crore while paid-up capital is Tk 43 crore.
