BSEC takes action against Indo-Bangla Pharma over rule violations

The Bangladesh Securities and Exchange Commission (BSEC) has found evidence of legal violations, irregularities, and financial inconsistencies in Indo-Bangla Pharmaceuticals Limited, a company listed in the capital market. Based on the recommendations of an investigation committee, the regulator has decided to take strict action against the company, including several key measures.
According to BSEC sources, legal action is being initiated against the company for multiple violations of securities laws, ranging from misuse of Initial Public Offering (IPO) funds to manipulation of financial statements.
This decision was made at a recent commission meeting of the BSEC, based on the investigation report. The Enforcement Department of the commission has been assigned to take necessary actions to address the irregularities.
Sources at the BSEC said that in April last year, a three-member investigation committee was formed to examine the overall business operations of Indo-Bangla Pharma and the use of its IPO funds. The committee, led by BSEC Additional Director Md Iqbal Hossain, reviewed documents covering five consecutive financial years from 2020 to 2024.
The investigation found that the company failed to properly utilise the funds collected from general investors through its IPO. In addition, significant discrepancies were identified in the company’s paid-up capital and annual financial reports. The report states that the company deliberately violated various provisions and regulations of securities laws over these five years. 
One of the most concerning findings highlighted in the investigation report relates to the company’s future viability. The current financial condition of Indo-Bangla Pharma is so fragile that there is a risk regarding its ability to continue operations, raising a “going concern threat.” The commission has instructed its Issuer Company Affairs Division to examine this matter with utmost importance.
Furthermore, the BSEC has taken new steps to ensure accountability of auditors. From now on, if any auditor detects violations of International Accounting Standards (IAS/IFRS) or any BSEC directives in a company’s financial statements, they must clearly disclose these in their reports.
The commission has also initiated a process to introduce new conditions for the enlistment of auditors in its panel.
To prevent such irregularities and inconsistencies, the BSEC has decided not to work alone. It will collaborate with other state agencies when necessary. In cases like Indo-Bangla Pharma, information may be shared with the Bangladesh Financial Intelligence Unit (BFIU), the National Board of Revenue (NBR), and the Registrar of Joint Stock Companies and Firms (RJSC) for further investigation.
Regarding the matter, BSEC Director and spokesperson Abul Kalam said, “Based on complaints, we conducted an investigation and found concrete evidence of various irregularities. Necessary legal actions are being taken against the company to ensure the protection of investors.”