Court hearings have formally begun in the much-delayed trial of 34 prominent members of the financial and business community charged with insider trading and manipulating the stock market.

Hundreds of thousands of small investors lost their savings in a $100m-share scam in 1996.

The resulting crash of the Bangladeshi stock market was dubbed the slaughter of the innocents, because those who lost most were small investors. They had been attracted by the meteoric rise in stock prices.

Many had put their life savings into the market. According to the regulatory authorities, prices were driven artificially high by a small group of well-connected individuals and companies.

When they sold off most of their holdings, share prices collapsed.

Prominent financiers

Those now standing trial include some of the pillars of finance and business in Bangladesh.

Among them are the current and former chairmen of the Dhaka Stock Exchange and the deputy chairman of the Beximco industrial group, one of the country's largest businesses.

After charges were first brought against them in 1997, they launched an appeal which was successful, but the government then took the case to the High Court, which upheld the original charges and ordered that the trial should proceed.

The stock market in Bangladesh has yet to recover from the plunge in 1996, which was blamed on insider trading and market manipulation.

But the authorities now appear determined to restore public confidence and attract more foreign investors.

A computerised trading system has been introduced and a number of reforms have been carried out to ensure greater transparency.