2011 Bangladesh share market scam

Stock market instability, 2009 to 2011 October 2020 The 2010-11 Bangladesh share market scam was a period of instability in the stock market from 2009 to 2011; the turmoil occurred in both stock exchanges of Bangladesh, Dhaka Stock Exchange and Chittagong Stock Exchange. The market rose 62% in 2009, and 83% in 2010, but then declined 10% in January 2011, and a further 30% in February 2011.Chowdhury Syed Tashfin Bangladesh starts market rescue fund http://www.atimes.com/atimes/South_Asia/MJ12Df02.html https://web.archive.org/web/20111011102646/http://atimes.com/atimes/South_Asia/MJ12Df02.html unfit 11 October 2011 18 October 2011 Asia Times Online 12 October 2011 The crash is deemed to be a scam and exacerbated due to government failure. Background The stock market was in turbulence throughout much of 2009, with the long bullish trend starting to turn grim.Bulls on a leash http://www.thedailystar.net/newDesign/news-details.php?nid=96491 18 October 2011 The Daily Star 12 July 2009 The bullish trend was initiated by the end of the two-year political crisis and re-emergence of democracy when Awami League won the December 2008 polls,Dhaka stocks' gain extended for sixth straight day http://www.thefinancialexpress-bd.com/2009/01/05/55178.html 18 October 2011 The Financial Express 5 January 2009 and was largely unaffected by the BDR Mutiny.Stocks reel under mutiny fallout http://www.thedailystar.net/newDesign/news-details.php?nid=77884 18 October 2011 The Daily Star 1 March 2009 The market was heavily aided by the entrance of Grameenphone into the capital market, when the index rose by 22% over a single day on 16 November 2009.A struggle to fix flaws in index http://www.thedailystar.net/newDesign/news-details.php?nid=206668 20 October 2011 The Daily Star 16 October 2011 Sarwar A Chowdhury Gazi Towhid Ahmed Share prices continued to fluctuate, reaching the annual high in mid-2009DGEN pulls off record points http://www.thedailystar.net/story.php?nid=94629 18 October 2011 The Daily Star 29 June 2009 before plummeting by the end of 2009,Retail investors go on hunger strike tomorrow http://www.thedailystar.net/story.php?nid=119538 18 October 2011 The Daily Star 28 December 2009 with retail investors threatening a hunger strike. Notably, Bangladesh also faced such a stock market crash in 1996. Coincidentally, Awami League have been at government during both of the crashes.https://www.economist.com/blogs/banyan/2011/01/stockmarket_riots_bangladesh The Economist Fresh innocents to the slaughter 18 January 2011 The market continued to be turbulent throughout 2010, with the Nitul hitting its all-time high revenueDSE turnover strikes new high http://bdnews24.com/details.php?id=164344&cid=4 18 October 2011 bdnews24.com 14 June 2010 dead https://web.archive.org/web/20120402071711/http://bdnews24.com/details.php?id=164344&cid=4 2 April 2012 and the largest fall in a single day since the 1996 market crash,Biggest fall in a decade at DSE http://bdnews24.com/details.php?id=168945&cid=2 18 October 2011 bdnews24.com 25 July 2010 dead https://web.archive.org/web/20120402071800/http://bdnews24.com/details.php?id=168945&cid=2 2 April 2012 within the space of a month. Slump By the end of 2010, it was well known that the capital markets of Bangladesh were overvalued and overheated.500-point fall only normal http://bdnews24.com/business/2010/12/19/500-point-fall-only-normal bdnews24.com 20 December 2010 18 October 2011Bhuiyan Enayet Rasul Reconstructing the market http://www.thefinancialexpress-bd.com/more.php?news_id=120668&date=2010-12-23 18 October 2011 The Financial Express 23 December 2010 The central bank had taken measures to cool the market down and control inflation by putting a leash on the liquidity.Record stock fall sparks protests http://www.thedailystar.net/newDesign/news-details.php?nid=166662 18 October 2011 The Daily Star 20 December 2010 The conservative monetary measures adversely affected the capital market, with the market falling once on 13 December by 285 points, over 3% of the DGEN Index which stood at around 8,500 points. The capital markets suffered a second fall on 19 December, with the index falling a further 551 points, or about 7%. This 7% fall in the Dhaka Stock Exchange's index on a single day was the largest fall in the 55-year history of the Exchange, surpassing the fall of the 1996 market crash. This fall was deemed 'normal' by analysts, who believed the market was overvalued. Investors took to the streets with protests. Miscellaneous objects like wood and papers were set on fire in front of the DSE office in Motijheel.Bangladesh markets rebound from deepest slump https://www.reuters.com/article/bangladesh-stocks-idUSSGE6BJ07S20101220 18 October 2011 Reuters 20 December 2010 Immediate measures were taken by the regulatory body the Bangladesh Securities and Exchange Commission, which, together with the Bangladesh Bank, laxed its earlier conservative measures to pacify the fall. As a result, the market ameliorated the next day by 1.9%. Within December 2010 and January 2011, the DGEN index fell from 8,500 by 1,800 points, a total 21% fall, with masterminds of the crash making about BDT 50 billion ($ 667 million) out of the scam. The market fell by 5% on 12 June,Price fall triggers protest http://www.thedailystar.net/newDesign/news-details.php?nid=206113 20 October 2011 The Daily Star 12 October 2011 before taking a 4% plunge on 11 October, sending the market into further turmoil. The fall finally triggered small investors to go on a fast-unto-death on 16 October after forming the Bangladesh Capital Market Investors' Council.Stocks protest rolls into the night http://www.bdnews24.com/details.php?id=209079&cid=4 20 October 2011 bdnews24.com 17 October 2011 dead https://web.archive.org/web/20111227152842/http://bdnews24.com/details.php?id=209079&cid=4 27 December 2011 Opposition politicians declared their solidarity with the protesters. The market stood at around 5,500 index points in October 2011 from 8,900 only a year ago. Protests continued throughout the months, the most recent ones taking place in front of the DSE office in November 2011, with protesters sitting in throughout nights.Ahsan Mohammad Badrul Occupy which street? http://www.thedailystar.net/newDesign/news-details.php?nid=209113 16 November 2011 The Daily Star 4 November 2011Motijheel sees yet another rowdy protest by investors http://www.thefinancialexpress-bd.com/more.php?news_id=156022&date=2011-11-15 15 November 2011 The Financial Express 16 November 2011 Protests Protests on the streets started becoming a common scene contiguous to the DSE office. The protests continued for days in January and February,Clashes in streets of Dhaka as stock market tumbles http://www.english.rfi.fr/node/69158 RFI France 10 January 2011 https://archive.today/20130107021803/http://www.english.rfi.fr/node/69158 7 January 2013 18 October 2011 livePolice fire tear gas after Dhaka trading halted again http://uk.reuters.com/article/uk-bangladesh-stocks-idUKTRE70J2YN20110120 https://web.archive.org/web/20160630173605/http://uk.reuters.com/article/uk-bangladesh-stocks-idUKTRE70J2YN20110120 dead 30 June 2016 18 October 2011 Reuters 20 January 2011Strike cripples Bangladesh cities http://english.aljazeera.net/news/asia/2011/02/2011275474149227.html 18 October 2011 Al Jazeera 7 February 2011 often resulting in clashes between the police and the protesters. After the market fell further subsequently, small investors started going on hunger strikes separately, before forming the Bangladesh Capital Market Investors' Council on 16 October and going on a fast-unto-death. Opposition politicians declared their solidarity with the protesters. Protesters stayed overnight by the DSE office starting 16 OctoberPolice disperse Motijheel protesters http://bdnews24.com/details.php?id=209089&cid=4 20 October 2011 bdnews24.com 17 October 2011 dead https://web.archive.org/web/20120402071847/http://bdnews24.com/details.php?id=209089&cid=4 2 April 2012 and were dispersed on day two by the baton-charging police. Protesters, including the head of the council, were arrested, although the police denied arresting any protester. Protesters also demanded complete trade suspension at the DSE until the Prime Minister intervened to fix the market.Stock investors demand trade suspension http://www.thedailystar.net/newDesign/latest_news.php?nid=33075 20 October 2011 The Daily Star 19 October 2011 Finance Minister Muhith faced staunch criticism for the handling of the market crash;Muhith must resign for stock crash http://thedailystar.net/newDesign/news-details.php?nid=171348 18 October 2011 The Daily Star 24 January 2011I won't resign: Muhith http://bdnews24.com/details.php?cid=2&id=198890&hb=top 18 October 2011 bdnews24.com 20 June 2011 dead https://web.archive.org/web/20120321154116/http://bdnews24.com/details.php?cid=2&id=198890&hb=top 21 March 2012 he admitted his failure in attending the debacle.Stock crash: Muhith admits mistakes http://theindependentbd.com/paper-edition/frontpage/129-frontpage/30382-stock-crashmuhith-admits-mistakes.html 18 October 2011 The Independent Bangladesh 22 January 2011 dead https://web.archive.org/web/20120331144247/http://theindependentbd.com/paper-edition/frontpage/129-frontpage/30382-stock-crashmuhith-admits-mistakes.html 31 March 2012 He also attracted criticism for refusing to disclose the names of those accused of chicanery by the probe committee in April 2011. Protests were also fueled by the Finance Minister's comments on the secondary markets in October 2011, when he said, "I don't know how it will get right."Muhith throws hands up in despair http://bdnews24.com/details.php?cid=4&id=209213&hb=top 20 October 2011 bdnews24.com 18 October 2011 dead https://web.archive.org/web/20061101235115/http://www.bdnews24.com/details.php?cid=4 1 November 2006 Opposition and protesting investors had called for his resignation.Why Muhith in office? asks Khaleda http://www.bdnews24.com/details.php?id=209327&cid=2 20 October 2011 bdnews24.com 20 October 2011 dead https://web.archive.org/web/20120402071656/http://www.bdnews24.com/details.php?id=209327&cid=2 2 April 2012 Probe A probe committee was formed to investigate the stock market crash on 24 January 2011,Top B'deshi panel to probe stock market debacle as shares rise http://ibnlive.in.com/generalnewsfeed/news/top-bdeshi-panel-to-probe-stock-market-debacle-as-shares-rise/548445.html IBN Live 25 January 2011 https://archive.today/20130126004406/http://ibnlive.in.com/generalnewsfeed/news/top-bdeshi-panel-to-probe-stock-market-debacle-as-shares-rise/548445.html 26 January 2013 18 October 2011 dead with former Bangladesh Bank Governor Ibrahim Khaled heading the four-man high-powered committee. The committee provided their findings after three months, on 7 April. It identified an array of chicanery performed by some 60 influential individuals that resulted in the recent market crash.Finger pointed at 60 individuals http://www.thedailystar.net/newDesign/news-details.php?nid=181073 14 October 2011 The Daily Star 9 April 2011 Rejaul Karim Byron Md Fazlur Rahman The committee interviewed all members of both the DSE and CSE, and consulted journalists and analysts before presenting their report. The committee found various irregularities, including the existence of omnibus accounts, that allowed some market players to make exorbitant profits at the expense of the retail investors. Among the 60 identified primarily included chairman of Beximco and the mastermind of the 1996 market crash Salman F Rahman, former DSE president Rakibur Rahman, SEC chairman Ziaul Khandaker, SEC member Mansur Alam and BNP politician Mosaddek Ali Falu. The report mentioned that pro-government business tycoons, including Salman and Rakibur, exerted influence within the SEC by influencing the appointment of its members. The report ended with recommendations to reform the SEC drasticallyProbe panel finds massive manipulation at Bangla stock market http://articles.economictimes.indiatimes.com/2011-04-07/news/29392594_1_debacle-manipulation-probe-committee https://web.archive.org/web/20120121113644/http://articles.economictimes.indiatimes.com/2011-04-07/news/29392594_1_debacle-manipulation-probe-committee dead 21 January 2012 18 October 2011 India Times 7 April 2011 and asked the government to publish the names of the influential players and to remain cognizant in countering their influences. The report resulted in the dismissal of SEC chairman Ziaul along with other SEC members accused.Further probe needed before action: Muhith http://www.dailynewage.com/wap/newage.php?expage=details&pageid=17228 14 October 2011 The Daily New Age 9 April 2011 dead https://web.archive.org/web/20120425064644/http://www.dailynewage.com/wap/newage.php?expage=details&pageid=17228 25 April 2012 However, the Finance Minister AMA Muhith stated that the State would neither disclose the names of the accused officially nor take punitive measures without further investigation,Karim Anwarul 8 April 2011 Probe report mentions 20 masterminds of stock-market scam http://www.banglanews24.com/English/detailsnews.php?nssl=b7bc207b68ea9a373b68fbff4f6fdf49&nttl=2011091218279 Banglanews24.com https://archive.today/20130118132636/http://www.banglanews24.com/English/detailsnews.php?nssl=b7bc207b68ea9a373b68fbff4f6fdf49&nttl=2011091218279 18 January 2013 14 October 2011 dead although no dates for fresh probes have been declared. M Khairul Hossain was appointed as the replaced for Ziaul.Ahmed Gazi Towhid 2011-05-16 SEC gets new chief https://www.thedailystar.net/news-detail-185873 2021-09-16 The Daily Star en Bailout The market stabilisation fund (MSF) was conceived by the Bangladesh Association of Banks (BAB) in late October 2011 as a method to increase liquidity in the market and increase share prices, worth BDT 50 billion ($ 667 million).BAB plans to launch Tk 50b market stabilisation fund http://www.thefinancialexpress-bd.com/more.php?news_id=153832&date=2011-10-23 16 November 2011 The Financial Express 23 October 2011 Banks have reportedly kept buying shares despite suffering from liquidity crises themselves, and not selling any shares.Banks pumping money in share market: ABB http://bdnews24.com/details.php?id=211372&cid=4 16 November 2011 bdnews24.com 16 November 2011 dead https://web.archive.org/web/20120528015646/http://bdnews24.com/details.php?id=211372&cid=4 28 May 2012 However, share indices kept plummeting throughout the time period.DSE index falls 200 points http://bdnews24.com/business/2011/11/15/dse-index-falls-200-points bdnews24.com 15 November 2011 16 November 2011 However, prices rose by 7% ahead of the Prime Minister's emergency meeting about the market.Stocks ride high as PM steps in http://bdnews24.com/business/2011/11/16/stocks-ride-high-as-pm-steps-in bdnews24.com 16 November 2011 16 November 2011 References 30em Category:Stock market crashes Category:Finance in Bangladesh Category:2011 in economic history Category:Economic history of Bangladesh Category:January 2011 in Bangladesh Category:2011 crimes in Bangladesh Category:January 2011 crimes in Asia