Mohammad Mufazzal

The securities regulator has said there is ‘nothing to be panicked’ over the market monitoring activities by the newly-launched surveillance software, as the software has been installed to ensure transparency.

The clarification over the apprehension of panics comes after the Securities and Exchange Commission (SEC) Monday launched its own market surveillance software, which made 2,971 alerts while reading about 10 per cent of the day's transaction within the last half an hour.

Among the alerts, 247 were red indicating the possibility of wrongdoings against the same number of BO (beneficiary owner's) accounts.

As a result, some investors and the trading operators of different brokerage firms Tuesday said big investors might be called by the regulator if the surveillance software shows red alerts following their large buy or sale orders.

But the SEC Executive Director Saifur Rahman, who was also involved with the installation of the software, ruled out the apprehension raised by the investors and trading operators saying that the regulator does not need to call the big investors to be clear about any red alerts.

"Our software has no relation with panic. The software has been installed to ensure transparent environment of share trading," Rahman told the FE.

He said, for example, a big investor can place a sell or buy order for 2.0 million shares without facing any bar. The features of the SEC's software included some thresholds.

"Price variation is a common matter of the markets. The software will ask us to be sure about any abnormality detected by red alerts. But the red alert does not mean that someone will be accused without committing any offense. But he or she will face music after our final investigation if wrong doings are really found."

He said the meaning of all red alerts is not manipulation or any kind of offence.

"At first, we will sure whether there is any price sensitive information behind any abnormal price hike. Secondly, we will observe the flow of demand and supply or the market trend. We can go for further justification if there is no presence of these matters."

He said the investors of stock markets have a habit to be panicked over the rumours or hearsays.

"The summons made by the securities regulator against wrong doings is not new incidence. Before the installation of the surveillance software, the SEC called many investors or stakeholders."

He said the regulator will not call anyone if it finds no wrong doings.

"There is no question to be panicked in fair activities by the investors. It is not the job of the regulator to create meaningless panics," Rahman said.

When asked, whether the number of red alerts would increase in accordance with the large trade volumes in future or when the omnibus accounts would be converted into separate BO (beneficiary owner's) accounts, Rahman said the red alerts are not related with the trade volumes.

He also said the omnibus accounts must be converted into separate BO accounts within a timeframe. "I do not know whether the regulator would extend the deadline for the conversion of omnibus accounts. The finance minister also has said that such accounts will be converted into BO accounts within a timeframe."