LC data of 5 banks ready for ACC probe

Posted by BankInfo on Thu, Jan 30 2014 11:51 am

Bangladesh Bank has prepared data about letters of credit of five banks to help an anti-draft body investigation into suspected money laundering cases in the name of imports.

Anti-Corruption Commission (ACC) launched the enquiry in October last year and sought the data of a 10-month period from July 2012.

The anti-draft body began the probe as there was an “abnormal increase” of capital machinery imports when the country was experiencing dull investment situation due to a long-lasting political turmoil.

Bangladesh Bank sent a letter to the ACC on Tuesday citing that the data is ready and can be collected in hard version.

The banks include state-owned Agrani, Janata and Rupali, private commercial Islami Bank and foreign HSBC.

The central bank prepared data of five banks in the July-April period last fiscal year.

Bangladesh Bank sources said the LC opening for capital machinery imports increased 31.6% in 10 months from one year ago although the period was identified as politically instable and sluggish for investment sector.

In November last year, the committee asked the central bank for the data.

According to the data, LCs to import capital machinery increased to $2.36bn during the period compared to $1.72bn one year earlier.

In the period, textile machinery imports showed a substantial increase by 14% to $373m, garment machinery 34% to $366.65m and power sector machinery 301% to $696m.

Although the ACC asked for 10 months data, Bangladesh Bank found the December data of 2013 of two banks also fishy when the capital machinery imports witnessed 300% rise.

The banks are Janata Bank and Dhaka Bank.

Of the December data, the central bank found $230m LCs of Janata Bank and $18m of Dhaka Bank suspicious, which were opened for capital machinery imports for energy sector.

Bangladesh Bank asked the two banks to provide information to investigate into if there is any case of money laundering in the name of imports.

The central bank executives said the rise of capital machinery imports was not normal as the entrepreneurs had remained shy of making any fresh investment during political instability centering January 5 elections.

According to them, ill attempts were being made through over-invoicing.

They said although the imported machineries were second hand and cheap, they were shown new and expensive in the invoices.

News:Dhaka Tribune/30-Jan-2014