Investors of Simtex Industries Limited, a publicly listed firm, are urging the dissolution of the company's Board of Directors (BoD) amid allegations of severe financial irregularities. Accusations have surfaced against certain directors and officials, including ties to known banking sector scammer PK Halder, of turning the company into a "bottomless basket" through corruption and money laundering.
Last week, Md Mohiuddin Mintu, president of Pujibazar Biniyogkari Kallan Forum, formally raised these concerns with a letter sent to the Bangladesh Securities and Exchange Commission (BSEC), urging the regulatory body’s immediate intervention.
According to the letter, scammer PK Halder’s accomplice Siddiqur Raman and his son Niaz Rahman Shakib occupied Simtex Industries and started laundering money from it. This act of financial theft found merit in the BSEC’s investigation as well.
The letter also reveals that Siddiqur Raman was the sole signatory on Simtex’s bank account, allowing him to withdraw funds without any limits.
During the financial year 2020-21, Siddiqur withdrew Tk 48.83 crore but paid only Tk 27.99 crore in different bills, allegedly embezzling and laundering Tk 20.84 crore. The Anti-Corruption Commission (ACC) has filed over a hundred cases against Siddiqur, his wife Mahfuja Rahman, their sons Neaz Rahman Shakib, Ehsan Ali Sheikh, and 62 others for money laundering, embezzlement, and misappropriation of funds.
Consequently, the court froze Simtex’s holdings and banned Siddiqur and Mahfuja from leaving the country.
Legally questionable
Meanwhile, Major General (retd) Md Sarwar Hossain had been appointed as chairman of Simtex, replacing Lt Col (retd) Md Anisur Rahman, despite the move being legally questionable. According to the BSEC Corporate Governance Code, Sarwar Hossain should not serve as an independent director due to alleged criminal activities and ethical concerns.
The stock market regulator challenged this appointment, leading the court to order a reconstitution of the board to safeguard the interests of the 56 per cent holding shareholders. As a result, Sarwar Hossain can no longer hold a position on the board.
The letter clearly states that the Simtex BoD had led its shareholders to appoint a five-member board to protect the interests of its general investors. However, Siddiqur, a fugitive and associate of scammer PK Halder, is allegedly calling the shots and controlling the company from Portugal.
Violating securities rules
Siddiqur’s son, Neaz Rahman Shakib, who is currently the managing director, has managed to stay a court order against him. Shakib is directly involved in business and financial dealings with PK Halder, and all his shares in Simtex Industries Limited have been frozen. Therefore, on ethical grounds, he no longer has the right to serve as a director or as the managing director of the company.
Back in 2022, former Simtex chairman Anisur Rahman sought the BSEC’s intervention to save the company and himself from Siddiqur Rahman, an associate of scammer PK Halder. Anisur reported that Siddiqur, a Simtex founder, fled to Portugal via India after the ACC filed a case against him.
He accused Siddiqur of siphoning off crores of taka from the company violating various securities rules. Anisur then assumed the role of director and continued as the company’s chairman, managing its bank and office signatories previously.
As on Sunday, Simtex Industries Limited’s shares closed at Tk 21.90 a share on the Dhaka Stock Exchange’s trading floor. The Savar-based textile factory paid out a 10 per cent cash dividend to its shareholders for the year ended on June 30, 2023.
