The Bangladesh Securities and Exchange Commission (BSEC) has asked for an explanation from two companies owned by cricket superstar Shakib Al Hasan for entering the country's gold market without regulatory permission.
Cricket all-rounder Shakib Al Hasan has recently launched the gold business alongside playing cricket. His two companies are named ‘Reliable Commodities Exchange Co’ and ‘Buraq Commodities Exchange Co.’
The stock market regulator, sending a letter on May 16 to the managing directors of the companies, sought clarification for launching the gold businesses flouting the law, within seven working days.
According to the letter, “…at this stage, you are requested to explain your position with regard to offering business through commodity futures contracts without approval of the Commission or without being a member of such a stock exchange (which is yet to start or get approval by the Commission) within 7 working days, which expired by May 25”.
Meanwhile, the BSEC has informed the governor of the Bangladesh Bank, the senior secretary of the Financial Institutions Division under the Ministry of Finance, and the secretary of the Ministry of Commerce about the violation.
Stipulating Section 8(4) of the Securities and Exchange Ordinance, 1969, the stock market regulator said a person or company not a member of the stock exchange will be barred from entering commodity futures contracts and launching business.
"No person other than a member will act as a broker or a [jobber or dealer] for any security not listed in the Stock Exchange," the letter reads.
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BSEC officials said that Shakib’s companies have no capacity to deal with gold as commodity futures contracts, well defined as securities as per Section 2(1)(iii) of the Securities and Exchange Ordinance, 1969.
Earlier on April 22, Shakib inaugurated a gold showroom at Banani in Dhaka. He entered into a deal with QRiUS Lifestyle to launch the venture.
The BSEC, in its letter, also referred to the content published recently in the daily newspaper — The Business Post and The Daily Observer.
In May last year, Sakib entered the brokerage business in the capital market of Bangladesh.
His company, Monarch Holdings, got approval from the stock market regulator to have a Trading Right Entitlement Certificate (TREC), a kind of licence to run a brokerage house.
Shakib is the chairman of Monarch Holdings.
