LR Global to be asked to take back investment in bdnews24.com: BSEC

The stock market regulator has decided to order LR Global Bangladesh Asset Management Company to take back the investment it made in purchasing stakes in online portal bdnews24.com, breaching securities rules.

The Bangladesh Securities and Exchange Commission (BSEC) will also fine the top officials of the asset management company if it fails to return the money within the stipulated time.

The commission took the decision today at a meeting held at its head office in the capital.

In a press release, the BSEC said the asset manager had invested Tk 49 crore in the equity of the news portal at Tk 12,500 per share, while the face value was Tk 100.

For the equity purchase, investments from six mutual funds—DBH First Mutual Fund, Green Delta Mutual Fund, AIBL 1st Islamic Mutual Fund, LR Global Bangladesh Mutual Fund One, NCCBL MF-1, and MBL First Mutual Fund—managed by the asset manager were used, violating securities rules.

The regulator investigated the illegal investment and decided to order the asset manager's CEO, Reaz Islam, to return the fund or face a fine of Tk 50 crore in case of failure to do it in 30 days.

At the same time, George Stock, a director and a member of the investment appraisal committee of LR Global, and Monowar Hossain, head of legal and compliance, will be fined Tk 4 crore each, while Ronal Micky Gomes, chief financial officer, will face a Tk 1 crore fine.

A fine of Tk 1 crore will also be imposed on LR Global as a company.

The asset management company harmed investors' interests through the investment in the news portal, the press release stated.

On this ground, the regulator will also launch an enquiry into the trustee of the funds—Bangladesh General Insurance Company—to assess its responsibility in the illegal investment process, according to the statement.