Thursday, 07 November, 2024
Bangladesh suffers an annual loss of approximately $13 billion due to illicit financial outflows, presenting major obstacles in recovering these misappropriated funds, according to Dr. Iftekharuzzaman, Executive Director of Transparency International Bangladesh (TIB). This figure, which underscores the country's ongoing struggles with financial crime, was shared during a seminar titled “Odious Debt & Recovery of Bangladesh’s Laundered Wealth”, organized by the Economic Reporters' Forum (ERF) and Sombabonar Bangladesh at the ERF Auditorium in Dhaka’s Paltan area on Saturday.
Dr. Iftekharuzzaman underscored the critical need for accountability in tackling money laundering, emphasizing that “money launderers must face consequences, and anti-money laundering agencies should be held answerable to prevent future incidents.” He called for stronger civil society advocacy and political support to establish a robust, sustainable anti-smuggling framework.
While acknowledging recent efforts by Bangladesh Bank (BB) and the Bangladesh Financial Intelligence Unit (BFIU) to address money laundering, Dr. Iftekharuzzaman noted that these institutions were previously accused of turning a blind eye to financial crimes under political influence. However, he recognized that the central bank has stepped up its initiatives to tackle illicit outflows, although he stressed the need to turn these efforts into a lasting system.
In a related statement, Bangladesh Bank Governor Abdur Rouf Talukder recently expressed concern over the unchecked capital flight that has hurt the economy. The Governor highlighted a commitment to tracking laundered funds and implementing stricter monitoring mechanisms, particularly in light of the International Monetary Fund's (IMF) conditions. He admitted that gaps in oversight allowed substantial loans to fictitious companies, exacerbating the issue. "We've observed significant misuse of bank loans, and it's imperative to address this structural weakness," the Governor stated.
Additionally, the Centre for Policy Dialogue (CPD) echoed these concerns, recently releasing a report that points to a worrying rise in financial outflows to tax havens and offshore destinations. CPD’s Executive Director, Dr. Fahmida Khatun, criticized the lack of concrete policies to curb this trend, asserting that the regulatory framework requires a complete overhaul to stem capital flight effectively.
The seminar’s keynote address was delivered by Anisuzzaman Chowdhury, an Emeritus Professor at Western Sydney University in Australia, who stressed that illicit financial flows have far-reaching impacts on economic growth, reducing funds available for development and exacerbating inequalities. He advocated for a more transparent banking sector and enforcement of stringent regulations to reduce these outflows.
Other notable speakers included Professor Jasim Uddin Ahmed, former Vice-Chancellor, and economist Nayem Chowdhury, founder of Astra Gattaca Oppenheimer in the USA, who emphasized the need for enhanced global cooperation in tracking laundered assets.
Tycoons Linked to Hasina Siphoned $17 Billion from Banks, Claims BB Chief
Earlier Bangladesh Bank (BB) Governor Ahsan H Mansur accused business tycoons linked to former Prime Minister Sheikh Hasina’s administration of collaborating with the country’s military intelligence agency to siphon $17 billion from the banking sector during her tenure. In an interview with The Financial Times,
Mansur alleged that the Directorate General of Forces Intelligence (DGFI) facilitated the forced takeovers of major banks by these influential figures. He estimated that Tk 2 lakh crore, or approximately $16.7 billion, was transferred out of Bangladesh through tactics such as issuing loans to newly installed shareholders and inflating import invoices.
“This is the largest, most significant bank heist by any international standard,” Mansur remarked.
The governor specifically named Mohammed Saiful Alam, founder and chairman of the industrial conglomerate S Alam Group, and his associates, claiming they siphoned off at least $10 billion from the banking sector after assuming control of banks with DGFI’s backing.
“Every day, they were approving loans for their interests,” Mansur added in the interview.
Economists Call for Immediate Action on Corruption, Inflation, and Forex Stability: EIB Special Survey
A recent survey by Economic Intelligence Bangladesh (EIB) reveals an urgent call from economists to address corruption, inflation, and foreign exchange stability as critical priorities for Bangladesh’s economic stability. The survey, titled “How Economists Prioritise Tasks Ahead”, gathered insights from 12 leading economists and academics across Bangladesh in September and was released today (1 October) by The Business Standard, in collaboration with DataSense.
In the survey, 42% of respondents ranked tackling corruption and money laundering as the top priority, emphasizing its profound impact on the nation’s economy. Professor Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue (CPD), recommended proactive legal measures against perpetrators, partnerships with other countries to recover stolen assets, and the establishment of community watchdogs to counter corruption.
Controlling inflation emerged as the second-highest priority, with 25% of economists stressing the importance of addressing rising costs that are straining household budgets. Zahid Hussain, former lead economist at the World Bank, advised the interim government to “prioritise essential food inflation control, disrupt syndicates involved in supply chain extortion, and counter collusive practices in key markets such as rice, flour, lentils, onions, and edible oils.”
Seventeen per cent of economists surveyed underscored the need to rebuild foreign exchange reserves to stabilize the economy amidst global economic uncertainty. They recommended fostering a market-friendly exchange rate system and implementing robust measures against corruption, as funds gained through corrupt practices are often siphoned abroad, exacerbating pressure on reserves.
Economists further advised renegotiating loan terms to alleviate near-term repayment pressures and securing concessional loans with extended grace periods, particularly for export-oriented sectors.
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Bangladesh suffers an annual loss of approximately $13 billion due to illicit financial outflows, presenting major obstacles in recovering these misappropriated funds, according to Dr. Iftekharuzzaman, Executive Director of Transparency International Bangladesh (TIB). This figure, which underscores the country's ongoing struggles with financial crime, was shared during a seminar titled “Odious Debt & Recovery of Bangladesh’s Laundered Wealth”, organized by the Economic Reporters' Forum (ERF) and Sombabonar Bangladesh at the ERF Auditorium in Dhaka’s Paltan area on Saturday.
Dr. Iftekharuzzaman underscored the critical need for accountability in tackling money laundering, emphasizing that “money launderers must face consequences, and anti-money laundering agencies should be held answerable to prevent future incidents.” He called for stronger civil society advocacy and political support to establish a robust, sustainable anti-smuggling framework.
While acknowledging recent efforts by Bangladesh Bank (BB) and the Bangladesh Financial Intelligence Unit (BFIU) to address money laundering, Dr. Iftekharuzzaman noted that these institutions were previously accused of turning a blind eye to financial crimes under political influence. However, he recognized that the central bank has stepped up its initiatives to tackle illicit outflows, although he stressed the need to turn these efforts into a lasting system.
In a related statement, Bangladesh Bank Governor Abdur Rouf Talukder recently expressed concern over the unchecked capital flight that has hurt the economy. The Governor highlighted a commitment to tracking laundered funds and implementing stricter monitoring mechanisms, particularly in light of the International Monetary Fund's (IMF) conditions. He admitted that gaps in oversight allowed substantial loans to fictitious companies, exacerbating the issue. "We've observed significant misuse of bank loans, and it's imperative to address this structural weakness," the Governor stated.
Additionally, the Centre for Policy Dialogue (CPD) echoed these concerns, recently releasing a report that points to a worrying rise in financial outflows to tax havens and offshore destinations. CPD’s Executive Director, Dr. Fahmida Khatun, criticized the lack of concrete policies to curb this trend, asserting that the regulatory framework requires a complete overhaul to stem capital flight effectively.
The seminar’s keynote address was delivered by Anisuzzaman Chowdhury, an Emeritus Professor at Western Sydney University in Australia, who stressed that illicit financial flows have far-reaching impacts on economic growth, reducing funds available for development and exacerbating inequalities. He advocated for a more transparent banking sector and enforcement of stringent regulations to reduce these outflows.
Other notable speakers included Professor Jasim Uddin Ahmed, former Vice-Chancellor, and economist Nayem Chowdhury, founder of Astra Gattaca Oppenheimer in the USA, who emphasized the need for enhanced global cooperation in tracking laundered assets.
Tycoons Linked to Hasina Siphoned $17 Billion from Banks, Claims BB Chief
Earlier Bangladesh Bank (BB) Governor Ahsan H Mansur accused business tycoons linked to former Prime Minister Sheikh Hasina’s administration of collaborating with the country’s military intelligence agency to siphon $17 billion from the banking sector during her tenure. In an interview with The Financial Times,
Mansur alleged that the Directorate General of Forces Intelligence (DGFI) facilitated the forced takeovers of major banks by these influential figures. He estimated that Tk 2 lakh crore, or approximately $16.7 billion, was transferred out of Bangladesh through tactics such as issuing loans to newly installed shareholders and inflating import invoices.
“This is the largest, most significant bank heist by any international standard,” Mansur remarked.
The governor specifically named Mohammed Saiful Alam, founder and chairman of the industrial conglomerate S Alam Group, and his associates, claiming they siphoned off at least $10 billion from the banking sector after assuming control of banks with DGFI’s backing.
“Every day, they were approving loans for their interests,” Mansur added in the interview.
Economists Call for Immediate Action on Corruption, Inflation, and Forex Stability: EIB Special Survey
A recent survey by Economic Intelligence Bangladesh (EIB) reveals an urgent call from economists to address corruption, inflation, and foreign exchange stability as critical priorities for Bangladesh’s economic stability. The survey, titled “How Economists Prioritise Tasks Ahead”, gathered insights from 12 leading economists and academics across Bangladesh in September and was released today (1 October) by The Business Standard, in collaboration with DataSense.
In the survey, 42% of respondents ranked tackling corruption and money laundering as the top priority, emphasizing its profound impact on the nation’s economy. Professor Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue (CPD), recommended proactive legal measures against perpetrators, partnerships with other countries to recover stolen assets, and the establishment of community watchdogs to counter corruption.
Controlling inflation emerged as the second-highest priority, with 25% of economists stressing the importance of addressing rising costs that are straining household budgets. Zahid Hussain, former lead economist at the World Bank, advised the interim government to “prioritise essential food inflation control, disrupt syndicates involved in supply chain extortion, and counter collusive practices in key markets such as rice, flour, lentils, onions, and edible oils.”
Seventeen per cent of economists surveyed underscored the need to rebuild foreign exchange reserves to stabilize the economy amidst global economic uncertainty. They recommended fostering a market-friendly exchange rate system and implementing robust measures against corruption, as funds gained through corrupt practices are often siphoned abroad, exacerbating pressure on reserves.
Economists further advised renegotiating loan terms to alleviate near-term repayment pressures and securing concessional loans with extended grace periods, particularly for export-oriented sectors.
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