The Financial Institutions Division of the Ministry of Finance has issued four directives, including the appointment of an observer, to address complications following the appointment of an administrator at Sonali Life Insurance Company.
On Monday, a letter signed by the division’s Joint Secretary Zahid Hossain was sent to the Insurance Development and Regulatory Authority (IDRA) and the insurance company regarding this matter.
The letter outlined steps to resolve the situation after IDRA suspended the board of directors and appointed an administrator at Sonali Life Insurance.
Among these steps is the nomination of Financial Institutions Division Joint Secretary Shah Alam as an observer to monitor the company's overall activities until further notice. He will regularly update the secretary of the Financial Institutions Division on the company’s overall activities.
To resolve legal complications, two independent directors must be appointed to Sonali Life Insurance by IDRA, contingent upon the withdrawal of all writ petitions filed by the company. One of these directors will serve as the chairman of the Interim Board of Directors.
After the audit firm completes its review, the report must be submitted to IDRA. The interim board is required to take the necessary steps to form a regular Board of Directors in accordance with regulations and transfer responsibility to the newly formed board as soon as possible.
It is noteworthy that on April 21, IDRA dissolved the board of directors and appointed an administrator at Sonali Life Insurance due to allegations of embezzling Tk 187 crore. Subsequently, on July 25, the Anti-Corruption Commission (ACC) filed a case regarding the embezzlement.
Additionally, in July, IDRA appointed the audit firm Hoda Vasi Chowdhury & Co to investigate corruption and irregularities in Sonali Life Insurance’s 10-year business activities. The Bangladesh Securities and Exchange Commission (BSEC) also formed an investigation committee to probe the irregularities and corruption at the company.
Recently, IDRA directed the current administrator of Sonali Life Insurance to reinstate dismissed employees and ensure they receive their rightful benefits. This directive followed an employee protest outside the IDRA building in Motijheel on August 17, prompted by dissatisfaction over denied benefits.
The finance ministry issued this decision within two weeks of the incident. IDRA was not immediately available for comment. However, IDRA spokesperson Jahangir Alam confirmed that a letter from the ministry had been received and that the directives would be followed accordingly.
