The central bank has strengthened its supervision on banks to check fraud in the banking system in settling bill purchases following the Hall-Mark scam.

In a notice yesterday, Bangladesh Bank asked banks to turn in applications in 15 days for settling import payment against back-to-back letters of credit using local sources -- fully or partially.

"It has come to the notice of Bangladesh Bank that authorised dealers are making inordinate delay in forwarding the applications for approval."

The banks are advised to submit the applications to the offices of Bangladesh Bank for approval within 15 days of the following month of effecting the payment, the central bank said.

In another circular, the regulator said starting from January 1 next year, ADs would have to report all types of their foreign exchange transactions through its web portal on daily basis.

Bangladesh Bank has taken initiative to receive online statement through its web portal. As part of the programme, its Foreign Exchange Operation Department has already started monitoring export transactions through online reports submitted by authorised dealers.

The central bank has developed online reporting system for all types of cross border foreign exchange transactions, including foreign exchange transactions, through inland back to back letters of credit.

The measures came as Bangladesh Bank tries to strengthen its supervision on banks following unmasking of the Hall-Mark scam, which unfolded that a number of state-run banks settled local LCs on forged documents.

News: The Daily Star/Bangladesh/11th-Dec-12