🇧🇩 Corruption Watch

[Saif]

Non-banks’ default loans hit record high

Non-bank financial institutions (NBFIs) in the past fiscal year saw their defaulted loans reach a record 33.15 percent of all disbursed loans, according to the central bank, indicating a fragile situation in the sector thanks to widespread loan irregularities and scams.

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Non-banks’ default loans hit record high

Non-bank financial institutions (NBFIs) in the past fiscal year saw their defaulted loans reach a record 33.15 percent of all disbursed loans, according to the central bank, indicating a fragile situation in the sector thanks to widespread loan irregularities and scams.

At the end of June 2024, soured loans at the 35 NBFIs in the country totalled a record of Tk 24,711.28 crore against their total disbursed loans of Tk 74,533.74 crore, according to the latest data from the Bangladesh Bank (BB).

In the past one year till June, bad loans at the finance companies increased by Tk 4,760.11 crore, or 24 percent.

As of June last year, default loans in the sector stood at Tk 19,951.17 crore, central bank data show.

Up until March 2024, bad loans at NBFIs amounted to Tk 23,889 crore.

However, a senior BB official said that the actual amount of bad loans in the sector is much higher than what is reported to the central bank.

The official, requesting anonymity, said some NBFIs' defaulted loans tend to increase after central bank inspections.

According to BB data, of the total Tk 24,711.28 crore NBFI bad loans, Tk 21,033.33 crore has been classified as "bad and loss" -- which means a low chance of recovery.

The figures come at a time when development partners and economists have expressed concerns about vulnerabilities in Bangladesh's financial sector due to rising distressed assets, including non-performing loans, and a lack of corporate governance.

There are two main reasons behind the growing trend of non-performing loans, according to Kanti Kumar Saha, chief executive officer of Alliance Finance.

He said that these toxic assets are "legacy loans" from the large scams and irregularities that dealt a severe blow to the sector a few years ago.

For example, he said PK Halder, former managing director of NRB Global Bank (later renamed Global Islami Bank), swindled at least Tk 3,500 crore from four NBFIs: People's Leasing, International Leasing, FAS Finance and Bangladesh Industrial Finance Company Limited (BIFC), according to BB probe.

As a result, these four NBFIs have become ailing institutions with over 90 percent of their loans going bad, Saha commented.

On the other hand, the July- August student protests caused business closures and financial difficulties for small and medium enterprises, making loan repayments difficult for them, Saha said.

He added that even some large corporations are facing similar problems.

"Not only the NBFIs, but the overall economy is currently facing multiple challenges, which have contributed to the rise in bad loans within the sector," said Md Golam Sarwar Bhuiyan, chairman of the Bangladesh Leasing and Finance Companies Association.

Industry insiders said that the central bank was largely responsible for the ailing NBFIs.

They said that the central bank's supervision of NBFIs was not up to the mark, as reflected by frequent reports of scams and loan irregularities in the sector over the last few years.

SMART formula scrapped for NBFIs

The Bangladesh Bank yesterday scrapped the SMART (Six month Moving Average Rate of Treasury Bill) formula for the non-bank financial institutions sector (NBFIs) in order to make interest rates in the NBFI sector fully market-based.

This move follows the removal of the SMART formula from the banking system in May of this year.

Now the interest rate will be fixed based on the demand and supply of loanable funds in the NBFIs sector.

The central bank, however, imposed some conditions, such as the finance companies will have to publish the interest rates of deposits and loans on their website; the interest rates can vary at 1 percent based on the clients; NBFIs cannot able to impose interest rate out of the market rate; and they have to mention the fixed rate or floating rate in the loans approval paper.

NBFIs will not be able to change the interest rate within the six months of approval, but after the six months they can re-fix the interest rate every six-month based on the market rate.

The SMART formula was introduced on June 20 last year.​

 

[Saif]

Tracing, recovering stolen wealth

IN RECENT years, the alarming trend of corrupt politicians and businessmen funnelling illicit funds into the United Kingdom, particularly London, has raised serious concerns for...

www.newagebd.net

Tracing, recovering stolen wealth
by Kollol Kibria 08 October, 2024, 00:00

IN RECENT years, the alarming trend of corrupt politicians and businessmen funnelling illicit funds into the United Kingdom, particularly London, has raised serious concerns for nations like Bangladesh. As billions of illicit dollars are parked in British real estate, businesses, and other financial assets, the challenge for countries suffering from corruption is twofold: understanding how the UK became a safe haven for this wealth and determining how to legally recover these assets. Despite having one of the most robust legal systems, the UK, especially London, has developed a reputation as a safe haven for illicit capital. The allure of London lies not only in its financial prominence but also in legal loopholes that make it difficult for foreign nations to recover illicitly acquired assets. For countries like Bangladesh, this poses both a challenge and an opportunity for new pathways for asset recovery.

London’s financial allure: a colonial legacy

LONDON’S evolution into a global financial hub has deep historical roots. During the colonial era, the British Empire became the world’s largest and most powerful economic force. London was the financial heart of this empire, and its institutions developed vast expertise in managing and transferring wealth across borders. As the empire collapsed in the mid-20th century, the UK sought new ways to sustain its economic prowess, ultimately transforming itself into a global financial hub.

The post-World War II era, particularly in the 1950s and 1960s, marked a turning point when the UK loosened capital restrictions to attract foreign investment. This liberalised economic environment enticed international elites from politically unstable or corrupt regimes, leading to the rapid accumulation of foreign wealth in British banks and real estate markets.

By the 1980s, London became a magnet for money from corrupt politicians and oligarchs, primarily due to the city’s lenient regulatory environment. This trend accelerated in the 1990s and 2000s, particularly with the collapse of the Soviet Union, as Russian oligarchs sought a safe haven for their wealth in the West.

The ‘London Laundromat’

LONDON’S real estate market has become one of the most visible manifestations of illicit capital. In affluent neighbourhoods such as Kensington, Chelsea, and Mayfair, foreign elites, many of whom are suspected of laundering money, have snapped up luxury properties. A 2022 Transparency International report revealed that over £1.5 billion worth of UK property is owned by Russian oligarchs or individuals linked to corruption. The majority of these properties are purchased through anonymous offshore companies, making it exceedingly difficult to trace the true owners.

The term ‘London Laundromat’ captures the city’s reputation as a laundering hub, where dirty money is cleansed through property investments, complex corporate structures and financial instruments. These shell companies, often registered in the UK’s overseas territories, such as the British Virgin Islands, serve to obscure ownership, allowing corrupt individuals to hide their wealth with minimal scrutiny.

Why corrupt individuals choose the UK

THE UK’s strong property rights and asset protection laws make it an ideal location for corrupt officials and businessmen seeking to safeguard their illicit gains. Once assets are purchased, it becomes difficult for foreign governments to seize them without navigating the UK’s complex legal system. In some cases, legal proceedings can drag on for years, providing ample time for individuals to protect their wealth.

The UK’s relationship with its overseas territories has also contributed to its status as a haven for illicit wealth. Territories such as the Cayman Islands and the British Virgin Islands are notorious for offering tax benefits and corporate anonymity. Many corrupt individuals channel their funds through these jurisdictions, using shell companies to distance themselves from their assets. While recent reforms have introduced beneficial ownership registers, these remain incomplete and often inaccessible to the public, further complicating efforts to trace and recover illicit wealth.

Legal obstacles: extradition and asset confiscation

THE UK’s strict legal protocols for extradition and asset confiscation are an added barrier for countries like Bangladesh seeking to recover stolen assets. For example, if a foreign government seeks to extradite a corrupt individual residing in the UK, they must provide substantial evidence and adhere to the stringent requirements of the UK legal system. The process is often long and complicated, allowing the individual to mount a robust legal defence and delay or even prevent extradition. In some instances, the UK courts have refused extradition requests, citing concerns about human rights violations in the requesting country. This legal framework, while offering protection to legitimate asylum seekers, also provides cover for corrupt individuals who can argue that their prosecution is politically motivated.

How Bangladesh can recover illicit assets

WHILE the legal environment in the UK presents challenges, Bangladesh has options to pursue the recovery of assets stolen by corrupt politicians and businessmen. The following legal avenues offer promising paths forward:

Utilising international conventions and mutual legal assistance treaties

Bangladesh is a signatory to the United Nations Convention against Corruption, which obliges countries to cooperate in the return of stolen assets. Under the convention, Bangladesh can work with the UK to identify and repatriate assets illicitly transferred by corrupt individuals. The UN convention provides a framework for the return of assets and encourages international cooperation in asset recovery cases, particularly when corruption affects developing countries. Mutual Legal Assistance Treaties between countries allow for cooperation in the investigation and prosecution of cross-border crimes, including money laundering and asset recovery. Bangladesh has signed several mutual legal assistance treaties, including with the UK, which can be leveraged to request assistance in tracing and confiscating illicit funds. Using these treaties, Bangladeshi authorities can request documents, banking records and other evidence necessary to prove that specific assets were acquired through corruption.

Engaging civil asset recovery proceedings and asset freezing and confiscation

In addition to criminal proceedings, Bangladesh can pursue civil asset recovery in the UK courts. Civil asset recovery allows the Bangladesh government to initiate lawsuits in UK courts to reclaim assets that were illicitly acquired and transferred abroad. Although this route is expensive and time-consuming, it can be an effective strategy when criminal prosecution is not feasible due to a lack of extradition treaties or other legal barriers. Working with UK authorities, Bangladesh can request that suspected assets be frozen until further investigation. This process, while slow, can prevent the movement or liquidation of funds.

Target offshore jurisdictions

A significant portion of illicit wealth from Bangladesh is funnelled through offshore jurisdictions such as the British Virgin Islands. To trace and recover these assets, Bangladesh can collaborate with international organisations and countries that specialise in targeting hidden offshore funds. Leveraging initiatives like the Financial Action Task Force, which provides guidelines and support for tackling money laundering, Bangladesh can gain critical assistance in recovering stolen assets from overseas territories. Additionally, Bangladesh can petition the UK government to issue Unexplained Wealth Orders against individuals suspected of holding illicit wealth in the UK, compelling them to explain the source of their assets. This legal tool could be instrumental in curbing financial crimes and recovering stolen wealth hidden abroad.

Increasing domestic anti-corruption measures

While pursuing international legal remedies, Bangladesh must also strengthen its domestic anti-corruption measures. By improving transparency, reforming financial regulations, and increasing the capacity of anti-corruption institutions, Bangladesh can create a more robust legal framework to prevent the illicit outflow of funds in the first place. Collaboration with international financial watchdogs can enhance these efforts.

Challenges in asset recovery

Recovering stolen assets remains a complex and costly endeavour, despite the legal avenues available. The UK’s legal system is structured to provide extensive protections for property owners, making it particularly challenging for foreign governments to reclaim assets. Corrupt individuals often exploit offshore structures and shell companies to distance themselves from their illicit wealth, creating layers of anonymity that are difficult to penetrate. Additionally, legal battles in UK courts can be protracted, with wealthy elites frequently employing top-tier legal representation to contest asset recovery efforts. Consequently, Bangladesh must adopt a coordinated strategy that combines legal expertise, international cooperation and diplomatic pressure. The UK’s historical role as a global financial hub, along with its robust legal protections and tax haven territories, has made it a sanctuary for corrupt politicians and businessmen seeking to launder and protect their illicit wealth. For Bangladesh, reclaiming these assets necessitates a multifaceted legal approach that involves international cooperation and comprehensive domestic reforms. By leveraging Mutual Legal Assistance Treaties, the United Nations Convention Against Corruption, civil asset recovery strategies, and targeting offshore jurisdictions, Bangladesh can work to recover stolen assets and hold corrupt individuals accountable.

As the global crackdown on corruption gains momentum, Bangladesh has a vital opportunity to reclaim its stolen wealth. Strengthening legal frameworks, utilising international agreements, and collaborating with UK authorities will enable Bangladesh to pursue and potentially recover illicit assets laundered abroad. However, this endeavour demands sustained effort, significant resources, and strategic diplomacy. Although the global financial system is intricate and opaque, it is not invincible. With the right tools and persistence, Bangladesh can effectively challenge the flow of dirty money and ensure accountability for those responsible for corruption, regardless of where they attempt to hide.

Kollol Kibria is an advocate at the Dhaka Judge Court and a political and human rights activist.​

 

[Saif]

Extortions back in Bangladesh's transport sector

The extortions in the country’s transport sector have got almost back in full swing from the first week of September as police, transport company owners and political leaders allegedly started taking...

www.newagebd.net

Extortions back in Bangladesh's transport sector
Staff Correspondent 10 October, 2024, 01:10

File photo

The extortions in the country’s transport sector have got almost back in full swing from the first week of September as police, transport company owners and political leaders allegedly started taking tolls in Dhaka as elsewhere across the country.

After the fall of Awami League regime on August 5, although the Bangladesh Nationalist Party took control over Dhaka Road Transport Owners Association instead of AL on August 14 through forming a convening committee, police started taking tolls in the first week of September, according to industry insiders, including transport owners.

After the fall of AL regime, BNP youth wing Jatiyatabadi Juba Dal leaders and activists were reportedly collecting from owners and even those running businesses AC and Non-AC buses of Bangladesh Road Transport Corporation, they said.

BNP Senior Joint General Secretary Ruhur Kabir Rizvi said that they had received several allegations of the party leaders and activists and took action against them.

‘We are now in a strict position about extortion and grabbing. We will not spare any party members involved in such activities,’ Rizvy told New Age.

In Dhaka city, people started collecting tolls for allowing to plying each Leguna.

In Shiksan to Gabtoli route each Leguna has to pay Tk 400 as they had to pay Tk 1,500 during the authoritarian Sheikh Hasina regime, according to several Leguna drivers.

Bus owners said that companies were taking money from each Dhaka city service and long route buses from bus owners in the name of gate pass popularly known as GP.

They said that if the GPs were not taken, the fare of buses would come down significantly and did not have to depend much on fuel oil prices.

Dewan Paribahan managing director Kutubuddin Swapan acknowledged collecting money as GP but said that the money was spent for giving salary of bus driver and his assistant along with accidents or other hassles on roads.

‘We are taking Tk 250-300 as GP now. We spent most of the money for the welfare of owners and workers,’ Kutubuddin said while the company had 41 city service buses.

Md Emon Hossain, who has been working as a driver’s assistant for the past five years in Dewan Paribahan, said that they got the money after providing money to owner, expensing on oil and GP money.

‘The bus company did not give us money for working in the sector. We have to earn our money after running bus on road and the portion was taken from bus owner,’ said Emon.

Md Hannan Hossain, driver of Dewan Paribahan said that they had to give Tk 800 as GP per day during the AL government while Tk 200 for launching e-ticketing.

VIP Paribahan has 120 buses and the company takes Tk 500 as GP from each bus, amounting Tk 60,000 per day from every day.

Md Lal Mia, a driver’s assistant of VIP Paribahan, told New Age that they took salary from the bus owners not from the company.

Asked about the toll in the name of GP, VIP Paribahan managing director Abdur Razzak cut the phone calls and did not respond to phone calls after several attempts.

GPs are collecting most of the bus companies in the city like Bhuiyan Paribahan, Desh Shatabdi, Bkash, Raida Paribahan, Tanzil, Labbaik, Malancha and Rajanigandha.

Several transport owners told New Age seeking anonymity that police did not take money from August 5 to September but started taking money from the first week of September.

They said that the traffic policemen were filing cases on transports on wholesale basis after having all valid documents in the past few days.

The traffic police are leaving those buses paying toll amount to traffic inspectors.

DMP spokesperson Muhammad Talebur Rahman said that they were unaware about police personnel involved in taking toll from buses.

‘If we receive specific allegations, we will look into the matter,’ Talebur added.

During the AL regime every city service buses had to pay Tk 110 to the Dhaka Sarak Paribahan Malik Samity, bus owners said that they had to pay from Tk 50 to Tk 100 for each bus to the same samity.

Bus owners said that the running did not create pressure in the same way like the AL government’s fixed toll, which is a slight relief for them.

On 10 August, BNP Cumilla district unit joint convener Saiful Islam Bhuiyan broke open the offices of the transport owners and workers in the capital’s Eskaton.

On August 14, they formed a convening committee, Saiful Islam convener, MA Baten and Rafiqul Islam Kajol as joint conveners in a 31-member committee.

A total of 71 members committee was formed through an election on September 10 where MA Baten and Saiful Islam elected as president and secretary general respectively while Khondoker Rafiqul Islam Kajol as executive president, said the newly formed committee organising secretary Zahid AL Latif.

‘We are not announcing the names to media as we are waiting for the government’s gazette,’ Zahid added.

Asked about the extortion in the name of GP and the malik samity to the bus owners, Saiful Islam said, ‘We are not collecting tolls. If some people take toll using our name, we will find out and bring them to book.’

He acknowledged about the allegations of taking money from the bus owners in the name of GP by the bus companies.

‘I have found some allegations from owners about GP. We are investigating the matter,’ Saiful added.

According to Saiful, about 240 companies’ buses are plying on roads in Dhaka city while 70 of them did not have proper route permit.

‘We have started working on this as well,’ he added.

On September 23, two groups of the BNP clashed over control of Bandhan Paribahan buses operating on the Dhaka-Narayanganj route, leaving at least 10 people injured.

The clash occurred near the launch terminal area of Narayanganj around noon. Both sides reportedly used firearms, sticks, and other weapons during the confrontation.

Police also detained 12 people in this connection.

Narayanganj Sadar model police station officer-in-charge Nazrul Islam told New Age that both groups filed two cases over the incident.

‘We have produced eight persons to the court and they were now in jail after two days remands,’ the OC added.


Meanwhile, the tolls were also collected from truck, pick-ups and covered vans in the name of municipalities for long route journey in most districts.

BNP-Jamaat leaders have been controlling the transport sector in Sylhet since the fall of Sheikh Hasina’s government. Sylhet District Bus Owners Association member said that any change in the practice of extortion has not come even though the government has changed, New Age Staff Correspondent in Sylhet reported.

A member of the association told New Age on condition of anonymity that the SDBOA president Abul Kalam, also former vice-president of the district BNP, and Islami Chhatra Shibir’s ex-president Lokman Ahmed are now controlling the transport sector of Sylhet.

‘Kalam was elected president of the SDBOA about a years back after joining to Awami League from BNP. But, immediately after changeover of the state power, he again merged with the BNP,’ the association member said.

Another transport owner said that apart from other kinds of benefits, the complete control of Ena Transport Express is now in the hands of Kalam and Lokman.

Being contacted, Kalam told New Age that as an uncontrolled-like situation is being prevailed so far in the country, it is tough to know always that what is actually happening. He, however, claimed that the overall situation of Sylhet transport sector is better now.

He also strongly rejected the allegations brought against him of extortion and taking illegal benefit from the transport owners or drivers.

Talking to New Age, district transport workers union’s executive president Abdus Salam said that he heard that extortion is being collected from the vehicles, which are used to carry smuggled and illegal goods.

‘These kinds of incidents are happening through a new syndicate. However, I did not know who are involved with the new syndicate, he said.

Salam also alleged that a gang of hoodlums are illegally collecting toll from the goods loaded trucks while entering the Chhatak municipal area.

“We already have complained against this illegal extortion. We also are ready to take to the streets to protest, if the situation crosses the limit of tolerance,’ he claimed.

In Rajshahi, after the fall of former prime minister Sheikh Hasina, two factions of BNP leaders and activists clashed over taking over the office of Rajshahi Road Transport Group on August 09, New Age Staff Correspondent in Rajshahi reported.

Later, the duo factions submitted written complaint with the Rajshahi deputy commissioner, claiming them as the new executive of the Road Transport Group.

Following the incident, the Rajshahi district administration then issued show-cause notices to the duo factions, asking why an administrator from the district administration would not be appointed.

Nazrul Islam Helal, a former member of Rajshahi City BNP who claimed himself as the new general secretary of the group, told New Age that they had already responded the show-cause notice and hoped that he would be declared legal general secretary.

Meanwhile, bus owners and transport workers alleged that collecting money in the name of the road transport group and motor shramik union continued like the previous way.

Wishing anonymity, several transport workers claimed that nothing except shifting the power to another hand has changed after the fall of the autocratic government on August 05.​

 

[Saif]

TIB estimates up to Tk 51,000 cr corruption in RHD projects

Tk 51,000 crore or estimated up to 40 per cent of the costs in the construction works carried out under the Roads and Highways Department development projects in the...

www.newagebd.net

TIB estimates up to Tk 51,000 cr corruption in RHD projects
Staff Correspondent 09 October, 2024, 15:27

Transparency International Bangladesh organises a research report unveiling programme at its office in Dhaka on Wednesday. | New Age photo

Tk 51,000 crore or estimated up to 40 per cent of the costs in the construction works carried out under the Roads and Highways Department development projects in the past 15 years was misused through corruption.

A Transparency International Bangladesh research report on Wednesday revealed the information.

‘In the roads and highways sector, development activities have been monopolised through tripartite collusion among politicians, high-ranking bureaucrats, and contractors, which has captured the policymaking process, procurement systems, and project implementation,’ read the report.

Blaming the three-party nexus for this massive embezzlement by violating laws, TIB executive director Iftekharuzzaman at a press conference, held at its office in the capital, said, ‘unless this nexus is busted, corruption will never be effectively controlled.’

In the context of the newly appointed interim government, he also said that overall some people were replaced by others in the new regime, but long-held institutional bad practices and mentality remained the same across sectors.

The TIB report shows that the estimated overall amount of corruption in the construction works of development projects implemented under the RHD from 2009–2010 to 2023–2024 fiscal years stood between Tk 29,230 crore and Tk 50,835 crore.

Percentage-wise, the report shows that the estimated corruption rate ranges from 23 per cent to 40 per cent of the total costs of the construction of roads and bridges in development projects implemented under the Annual Development Programme.

The corruption includes 11–14 per cent bribery in obtaining work orders and receiving bills by the contractors, 10–20 per cent corruption through collusion between politicians, contractors, and high-level officials, and 2–6 per cent corruption in areas, including renting tender licences, selling work orders, compromises and local political extortion.

Data for the research titled ‘Governance challenges in the implementation of Roads and Highways’ development projects’ was collected from June 2023 to September this year.

The development projects completed between 2017–18 and 2021–22 fiscals (initiated from 2010–11 to 2018–19) were included in the specific scope of this study.

Emphasis in the study was laid on the government-funded projects below Tk 1,000 crore, while mega projects funded by foreign donors were excluded due to differences in modalities of implementation, decision-making, and policy-making processes.

The overall observation on corruption in the research, however, was made on all the roads and highways department projects executed under both local and foreign funds in the past 15 years under the annual development programme, said TIB senior research fellow Md Julkarnayeen, who conducted the research with fellow research associate Md Mostafa Kamal.

In the past five years, 38.8 per cent of the completed projects took 4–5 years to finish, and 13.7 per cent took more than five years with the project costs increased by as much as 93 per cent compared with the original budget estimation, the research found.

The research outcomes also showed that these projects often failed to follow the laws and guidelines, skipped proper planning and feasibility studies, and also lacked coordination among different authorities.

Without in-depth feasibility assessments and environmental impact evaluations, including assessment for climate change impact and disaster risks, the projects lack sustainability.

While only 19 out of 25 completed projects under the scope of the research had evaluation reports prepared, only seven of these reports were published on the Implementation Monitoring and Evaluation Division website.

The RHD’s audit for the 2019–20 fiscal was completed in 2021, and the report was presented to the relevant parliamentary committee in the 2023–24 fiscal.

Over the past decade, 15 major contracting firms had established dominance by capturing the RHD tendering process through the internal settlement and collusion, the report said.

‘We thought that during this interim government period we would get information but we did not,’ Iftekharuzzaman alleged, adding that on Tuesday the RHD officials told them that they would give them the information.

He said that those involved in the three-party nexus should be brought under exemplary accountability in the changed scenario of the country.

To prevent personal gains, nepotism, irregularities and corruption in the implementation of roads and highways development projects, he also demanded a ‘conflict of interest law’ and its strict reflection in other relevant rules and regulations.

‘We believe that a scope has been created and the nation should take this opportunity,’ added the TIB chief.

The background of the research read that since the 2013–14 fiscal, the transport and communication sector had received the highest allocations in the annual development programme, while the total development expenditure for the RHD allocated from the ADP budget between 2009–2010 and 2023–2024 fiscals amounted to Tk 1,69,450 crore.​

 

[Saif]

A sinkhole of corruption

TIB study reveals massive corruption in RHD projects

www.thedailystar.net

A sinkhole of corruption
TIB study reveals massive corruption in RHD projects

VISUAL: STAR

It is more or less common knowledge that there was widespread corruption in the transport sector during Awami League's 15-year rule. A recent study by the Transparency International Bangladesh (TIB) has now uncovered the extent of the irregularities that took place in development projects undertaken by the Roads and Highways Department (RHD), and its nothing short of staggering. According to the study, corruption in these projects caused a loss of Tk 29,230 to Tk 50,835 crore, or 23 to 40 percent of total project costs. This is not the full picture, but it does show how a deeply entrenched system of corruption resulted not just in inflated budgets, but also substandard infrastructure, with no one held accountable for it.

While the TIB primarily focused on domestically funded projects, its researchers estimate that corruption levels were almost similar in both foreign- and locally-funded projects. Firms reportedly paid a significant percentage of the total work order value as bribes to secure contracts, with further payments made during inspections and construction phases. And everyone involved—ranging from concerned ministers, local MPs and politicians to top officials, project directors, and those overseeing tender evaluation, procurement, inspection, etc.—got a cut. It is no wonder that initial budgets were often revised up to satisfy their greed, while the contractors got away with using inferior materials and disregarding project specifications, requiring repairs or fresh construction that would repeat this corrupt cycle.

This tripartite collusion among politicians, officials, and contractors—which frequently extended to other powerful stakeholders in the transport sector—was institutionalised over the years, forcing citizens to pay for extremely expensive projects that brought little benefits. Fast and safe mobility remains an elusive dream despite billions spent to achieve these goals. This has been once again highlighted by the Road Safety Foundation that recently disclosed that 426 people were killed in road crashes in September alone. Road safety is intrinsically related to road infrastructure. Ill-executed projects and poor road conditions, combined with the neglect of critical safety measures such as traffic enforcement, are responsible for frequent clashes and congestions.

The challenge for the new Bangladesh is to address these dual crises—corruption in transport sector and resultant suffering and casualties—with equal importance. We think the non-political, interim government is uniquely suited to break this cycle. The TIB has offered its help to identify those involved in road development corruption, which the government should accept. Going forward, there should be greater transparency and accountability in development projects to ensure public funds benefit the public. Additionally, a comprehensive approach to road safety—focusing on stricter enforcement of rules, better infrastructure, and better regulation of transport owners and workers—is essential to prevent further loss of lives.​

 

[Saif]

Stolen asset recovery process still at preliminary stage

The interim government has taken some initial moves to bring back the stolen assets from abroad after the previous Awami League regime overthrown amid a student-led mass uprising on...

www.newagebd.net

Stolen asset recovery process still at preliminary stage
Shakhawat Hossain 11 October, 2024, 00:00

The interim government has taken some initial moves to bring back the stolen assets from abroad after the previous Awami League regime overthrown amid a student-led mass uprising on August 5 hardly made any breakthrough in this regard, said officials.

Led by chief adviser professor Muhammad Yunus, the interim government has already reconstituted the national task force on repatriating stolen assets and overhauled the Bangladesh Financial Intelligence Unit as part of its initial moves to recover stolen assets from different parts of the world.

Economists observe that the success in recovering the stolen money depends largely on the freezing of the smuggled and laundered assets by the governments of the destination countries.

The chief adviser has also sought cooperation from some major countries, including the United States, and also from the international bodies, including the United Nations and World Bank, to bring back the stolen assets, particularly those smuggled out and laundered in the past 15 years of the Awami League rule.

The now fallen Awami regime led by Sheikh Hasina faces not only the allegations of stealing money, but those of vote rigging, rights abuse and widespread corruption also, triggering the July student protests.

Drawing attention to the measures by the United States and its Western allies that saw freezing of assets worth around $58 billion of the Russians, economists have said that the interim government should at first persuade the Western countries to freeze the assets of suspected Bangladesh citizens.

Bringing back those assets should be dealt with under long-term plans, said M Masrur Reaz, chairman of think tank Policy Exchange Bangladesh, while talking to New Age on Wednesday.

He said that the interim government should also deal with the sensitive issue under a strategy.

Economists have also said that it has become imperative for the interim government to make visible progress in bringing the stolen money back particularly following the chief adviser’s office’s estimation that over Tk 1,00,000 crore had been laundered over the past 15 years.

In April, the World Bank, quoting the ‘State of the tax justice report 2020’, reported that around $3.15 billion outflows from Bangladesh occurred annually through illegal offshore accounts.

On September 29, the national taskforce on repatriating stolen assets was reconstituted with the Bangladesh Bank governor replacing the attorney general at the top.

The attorney general had been steering the taskforce since 2013 but without any major breakthrough in recovering stolen assets.

Available data show that Bangladesh repatriated around $2.6 million from Singapore between 2012 and 2013, and also sent back $1.58 million to the United Kingdom between 2010 and 2015 in relation to money laundering.

The data and information released by local and international agencies and news media, however, show the massive wealth, acquired through illegal means, owned by Bangladeshi citizens in infamous Begumpara (luxury houses in posh neighbourhoods) in Canada, Singapore, the United Arab Emirates, the USA, the UK and Malaysia, demonstrating that the efforts by the previous government to check money laundering and prevent terrorism financing bore little fruit in checking capital flight.

Qatar-based media outlet Al Jazeera reported that Saifuzzaman, then land minister and a close ally of the now deposed prime minister Sheikh Hasina, bought over 360 luxury properties in Britain alone worth $250 million.

His appetite for real estate spread to Dubai, New York, Singapore and Malaysia.

Mohammed Abdus Sobhan Miah, who worked as a cab driver, pizza chef and drugstore clerk while living in New York City, returned to Bangladesh to serve as an aide to then prime minister Sheikh Hasina. He started secretly snapping up properties in New York worth millions of dollars, according to the Organised Crime and Corruption Reporting Project, a global network of investigative journalists.

In Malaysia, Bangladeshi citizens occupy fifth position in the list of participants in its ‘Malaysia My Second Home’ programme after the China, Australia, South Korea and Japan nationals.

Until January 2024, as many as 3,604 Bangladeshi citizens had set up their second home in Malaysia without taking any permission from Bangladesh Bank.

Investment from Bangladesh to other countries can only happen with the country’s central bank’s permission.

Praising chief adviser Muhammad Yunus for seeking US assistance to recover the money laundered there by Bangladeshis during meeting with secretary of state Antony Blinken in New York on September 26, Dhaka University economics professor MM Akash called his initiative very encouraging.

Publicly identifying the Bangladeshi citizens with illegal assets in different countries will be a big achievement for the interim government, he said.

According to officials of the Financial Institutions Division under the finance ministry, the World Bank’s Stolen Asset Recovery Initiative is a time consuming process.

Seeking legal mutual assistance is often preferable, they said, but also mentioned that the Anti-Corruption Commission’s moves seeking mutual legal assistance from different countries during the immediate past regime made hardly any progress.

Central bank spokesperson Husne Ara Shikha said that they had no update as yet regarding the stolen money repatriation initiative by the interim government.

The spokesperson referred the issue to the Bangladesh Financial Intelligence Unit.

A financial intelligence unit official on condition of anonymity said that the process of repatriating stolen assets was still limited within restructuring a national committee.

The reconstituted committee has yet to fix any date for holding its first meeting, according to the officials.

On August 14, finance adviser Salehuddin Ahmed presided over a meeting of the National Coordination Committee on Anti-Money Laundering at the Secretariat.

He directed all relevant bodies to carry out responsibilities within the guideline and regulations.

The illegal outflow of foreign currency, however, excludes the $80 million heist from Bangladesh Bank in 2016 by suspected hackers who laundered the money at casinos in the Philippines.

Only $15 million of the stolen fund was sent back following a Philippines court order, while $66 million has yet to be recovered.​

 

[Saif]

Trimming costs of megaprojects

It is astounding to know that cost of some railway megaprojects was overblown by billions of Taka(s). This is what investigation by the present government has revealed. Hence, it comes as no surprise that drastic cuts are now in the offing. The Dohazari-Cox's Bazar-Ramu-Ghundhum project, originally

thefinancialexpress.com.bd

Trimming costs of megaprojects
Syed Mansur Hashim
Published :
Oct 10, 2024 22:00
Updated :
Oct 10, 2024 22:00

It is astounding to know that cost of some railway megaprojects was overblown by billions of Taka(s). This is what investigation by the present government has revealed. Hence, it comes as no surprise that drastic cuts are now in the offing. The Dohazari-Cox's Bazar-Ramu-Ghundhum project, originally estimated to cost Tk 180.34 billion, is now revised downward by Tk 66 billion to Tk 114.34 billion. The other, the Chinese-funded Padma Rail-Link Project that had been purported to be worth Tk 394.47 billion is now to cost Tk 369.47 billion, a savings of Tk 25 billion. The total savings are estimated at Tk 91 billion. This is just two of the many mega-projects undertaken by the previous government.

It was no secret that development project budgets had been inflated to cover kickbacks both to administration and contracting parties. Till now, it had been impossible to get to the bottom of it. Now that there has been a change in the country's administration, such matters are being brought to light. It is obvious that some good is coming out of the various committees that have been formed to look into the state of the country's finances. It will be very interesting to see what the various 'White Papers', which are in various stages of preparation, says.

It is now abundantly clear that a lot of unnecessary components were added to budgets of mega-projects to inflate costs. Again, it has also become painfully obvious that unnecessary projects were adopted by the previous administration to generate business and not development. Many of these projects have been found to be boasting staggering costs which fall apart in the face of closer scrutiny. The crux of the problem with projects such as these is of course, the financing. Very few of the hugely expensive mega infrastructure projects in the country have been financed by soft loans. Rather, commercial loans with shortened repayment periods and steeper interest rates became the backbone of financing projects. No honeymoon lasts forever and the party is now over. The present government is now stuck with the economic burden of the past and it is quite natural that every major project that has been put through the pipeline gets audited.

Besides, time overrun has been synonymous with development projects in Bangladesh. It is now more imperative than ever to scrutinize and identify all the unnecessary projects undertaken to see which can be justified and those that simply have no reason to exist. Of course, that is easier said than done. Many projects are simply too advanced in terms of project completion to be totally discarded. However, it is possible to trim the costs by deleting those components that have no reason to be included in a particular project. Rationalisation is further possible by reassessing the cost of various project components that have been artificially increased to boast profits beyond reason.

In line with that, it has become abundantly clear that the Jamuna rail-bridge construction project is seriously overpriced. According to what ministry of railway (MoR) officials have shared with the Financial Express, "we have started reviewing our ongoing projects. We will rationalize their costs and scope of works". This is very much in line with the review of a slew of expensive infrastructure projects undertaken by the MoR over the past decade and a half. Building rail connectivity and associated infrastructure is an expensive affair. Hence it opens up the necessary scope for graft and that had been fully taken advantage of by political masters of the day.

These committees that have been formed need time to complete their work. The reform agenda is just beginning to take shape and it is obvious that getting back the stupendous amounts of money that have been siphoned off by various members of the preceding ruling class and laundered abroad is going to take a lot of time. Even if the country is able to recover 20 per cent of the estimated US$150.0 billion that is purported to have left the country over the years, the amount will be $30 billion dollars! That sum is nearly 50 per cent more than the current foreign exchange reserves of the country and would help a lot to turn things around for the economy.

These reforms and investigations are obviously uncomfortable for some members of society, because it is difficult to know who has profited from these unjustified and unnecessary project cost escalations. If the interim government is actually serious about making long-lasting changes that will benefit the country's finances and introduce a culture of transparency and accountability, then no stone should be left unturned to get back money laundered abroad. For that to happen, these audits must continue and the White Papers need to be published so that people are not left in the dark anymore and the painful task of recovering monies stolen can begin.​

 

[Saif]

RHD a hotbed of corruption

What has been revealed by Transparency International Bangladesh (TIB) in a recent research study about the level of corruption in the Roads and Highways Department (RHD) is deeply shocking. For decades, this department has been a hotbed of corruption, but the level of graft had reached a new height

thefinancialexpress.com.bd

RHD a hotbed of corruption
FE
Published :
Oct 12, 2024 22:06
Updated :
Oct 12, 2024 22:06

What has been revealed by Transparency International Bangladesh (TIB) in a recent research study about the level of corruption in the Roads and Highways Department (RHD) is deeply shocking. For decades, this department has been a hotbed of corruption, but the level of graft had reached a new height over the last 15 years. The TIB research study has presented how a whole cabal of various interest groups had come together to rip off the national exchequer with hugely over-inflated project costs. The report has stated that political leaders, bureaucrats, engineers, contractors etc., were involved in illegal tradeoff from the road and bridge development projects executed by the RHD during the Fiscal Year 2009-2010 to FY 2023-24.

The graft amounts, according to the study, ranged anywhere from Tk 292.30 billion to Tk 508.35 to develop and construct roads, highways and bridges. Since everyone got a slice of the pie, no one complained - except ordinary citizens. It is the electorate who were left to pick up the pieces of shoddy jobs that were commissioned and quality control was not a priority area. Hence, commissioned road networks had worn out much faster than envisaged (or stated in project documents) and since money had changed hands, mere lip service was paid to address complaints. The immediate-past government had proudly declared "zero tolerance" on corruption. The few individuals who were investigated did never include those who sat at the top of the pyramid (of graft). The minnows were exhibited as examples of the war on corruption. The study that has been carried out goes into detail about the percentage of graft involved in RHD project execution. For instance, it is stated that the bribery amount ranged between 23 per cent and 40 per cent of the work orders. Now that brings the amount to Tk 1.27 trillion over a 15-year period. There were other bribes involved. A certain percentage had to be paid at the time of handing over of work orders to contractors and another amount had to be paid at the time of the payments made against bills submitted following the completion of the project work. So, in total, about 50 per cent of work contract value was paid in bribes.

Now that explains why contractors fail to do quality work on roads and highway projects. The aim is not to deliver quality work but to share funds plundered through irregularities. The media had enough to write on round the year and they covered a part of it. Given that black laws enacted by the Hasina regime to muzzle the press from doing its job, a lot of the disasters are now being exposed.

The question is will the interim government take the TIB study seriously? People want some actions on its part, for, given the past track records, they do not have much faith in any political government's seriousness in tackling graft. The "Ghush-banijjo" as bribery is popularly known in Bangla is a cancer that has devoured everything. Billions of Taka have changed hands and this is one department that cannot be ignored.​

 

[Saif]

Railway station constructed at exorbitant cost

The railway has built a station in Kaliakair of Gazipur at a cost of nearly Tk 580 million with an expectation that more than 10,000 passengers would travel daily between the Gazipur industrial area, Dhaka, and northern Bengal. But an average of only 47 passengers has used the station daily in...

en.prothomalo.com

Railway station constructed at exorbitant cost
Anowar Hossain
Dhaka
Published: 13 Oct 2024, 12: 26

The Bangabandhu Hi-Tech City Station in Kaliakair, Gazipur, modeled after the Kamalapur Station in Dhaka, was constructed at a cost of about Tk 580 million. Only two trains stop here, which means that the revenue is not even enough to cover the salaries and allowances of the officials. The photo was taken on last Wednesday. Masud Rana

The railway has built a station in Kaliakair of Gazipur at a cost of nearly Tk 580 million with an expectation that more than 10,000 passengers would travel daily between the Gazipur industrial area, Dhaka, and northern Bengal.

But on average, only 47 passengers have used the station daily in the past three years.

The total annual expenses for this station, including salaries for the staff and maintenance costs, exceed Tk 3 million, while the average annual income is only about Tk 9,25,000, according to railway sources.

This station, equipped with modern facilities, was inaugurated in 2018 beside the Kaliakair Hi-Tech Park. Six years after its opening, it is found that only two trains stop here: the Tangail Commuter and the Sirajganj Express. In contrast, 40 trains operate on the route from Dhaka to Tangail and northern Bengal, but they do not stop at this station due to a lack of passengers.

Railway sources said passenger services did not improve during the 15 years of the Awami League government. Necessary engines and coaches have not been purchased, and there is a shortage of manpower. Yet, during this period, significant investments have been made in constructing and repairing new railway lines and station buildings, many of which are not being utilized.

Muhammad Fouzul Kabir Khan, speaking to Prothom Alo on Friday, said that there has been no foresight in project implementation over the past 15 years, and that irregularities are pervasive. He assured that the current government will not undertake projects in such an unplanned manner and that past irregularities will be investigated.

Railway data indicates that out of 484 stations across the country, 116 have been closed during the past government’s tenure. Meanwhile, 146 new station buildings have been constructed, mostly funded by foreign investments. Additionally, 237 station buildings have been repaired and upgraded during this period.

Preferring not to be named, a railway official said that while the previous government emphasized the construction of station buildings and railway lines, there was little interest in purchasing engines and coaches, as that process is time-consuming and offers less commission than construction projects, which attracted more interest from railway ministers, officials, and contractors.

Expenditure higher than income at Kaliakair station
According to railway calculation, the Kaliakair station currently has nine staff members, including a stationmaster and ticket sellers. Their monthly salaries and allowances exceed Tk 200,000. There is a cost for maintenance costs for electricity and water. The total annual expenses stand at over Tk 3 million.

However, the income generated is minimal. In the 2022-23 fiscal year, the station earned only Tk 1.07 million. For the fiscal year 2021-22, the earnings were Tk 1.18 million, and in 2020-21, it was just Tk 525,000. The annual income on an average is Tk 9,25,000.

Railway sources said the project for the construction of this station centered around the Kaliakair Hi-Tech Park was initiated in 2015, with its design modeled after the Kamalapur Railway Station in the capital.

Huge expenditure for iconic station
The construction of an iconic station in Cox’s Bazar, a beach town, was inaugurated last November for the first time. A total of nine new stations have been built along the route from Dohazari in Chattogram to Cox’s Bazar, with the iconic six-storey, seashell-shaped station near Cox’s Bazar costing Tk 2.15 billion.

Spanning 29 acres and 187,000 square feet, it is equipped with a five-star hotel, shopping mall, restaurant, childcare center, and luggage lockers. This air-conditioned station can accommodate 46,000 people and also includes a post office, convention center, information center, ATM booths, and prayer spaces.

According to railway sources, the total cost for constructing 100 kilometers of railway line and nine stations along this route amounted to Tk 154.76 billion.

Preferring not to be named, a railway official said that while an iconic station was deemed necessary in a coastal town, the costs were excessive.

Currently, three pairs of trains operate on this route, with two pairs not stopping at any intermediate stations, while one local train stops at four stations in between. Despite the massive investment in the iconic station, the other stations are not fully utilized.

A station has been constructed in the middle of a village at Bhanga of Faridpur at a cost of Tk 15 billion. The picture was taken at Bamonkanda of Gharua union on Wednesday. Alimuzzaman

Another example of high expenditure on station construction is the Bhanga Railway Station in Faridpur, built at a cost of Tk 1.5 billion.

This station is part of the Padma Bridge railway link project, which has a total budget exceeding Tk 390 billion, including the construction of a 169-kilometer railway line from Dhaka through the Padma Bridge to Jashore and 14 new stations.

Railway sources said that the new Bhanga station is located five kilometers from the Bhanga junction and 12 kilometers from the Shibchar station in Madaripur. The old junction has been repaired and expanded under the project. There are no notable towns or landmarks between these two stations. The Bhanga station was built in the middle of a field at a high cost. There are multiple platforms and the station is three story building. Initially, there were no plans to construct a station at such a high cost.

According to railway sources, the inclusion of this massive station was influenced by the then-chief whip of parliament, Noor-e-Alam Chowdhury (Liton Chowdhury), and his brother, former MP for Bhanga, Mujibur Rahman Chowdhury (Nixon Chowdhury), who are related to the former prime minister Sheikh Hasina. After the government’s fall, both of them went into hiding, and their comments could not be obtained.

An official, who preferred not to be named, said that Liton Chowdhury and Nixon Chowdhury pressured the authorities to build this station under the pretext of establishing an Olympic Village and an international airport in Madaripur.

Station remains unused, but expenses continue

The Rooppur Railway Station in Ishwardi, Pabna, was constructed at a cost of Tk 3.36 billion for transporting materials for the Rooppur Nuclear Power Project, and a 26-kilometer railway line was built. The line was inaugurated in February last year, but no trains have begun operations yet, and the railway authorities do not know when trains will run at this station.

Railway sources said that a new line has been installed in the Akhaura-Laksham section of the Dhaka-Chattogram railway route with funding from the Asian Development Bank (ADB).

Thirteen stations, including Maynamati, Lalmai, and Alishwar in Comilla, were modernized under this project, but no trains have stopped at these stations since their opening in 2018.

Another line has been constructed in the Laksham-Chinki Astana section of the Dhaka-Chittagong railway with funding from Japan's international organization JICA. Stations in Nauti, Sharshadi, Kalidah, and Mohuriganj in Comilla were modernised under the project, but trains do not stop at these stations either.

Additionally, at least four new stations along the new railway line from Faridpur to Gopalganj also do not have train services. These are located in Gopalganj's Tungipara, Borashi, Chandradighalia, Kashiani's Choto-Bahirbag, and Chapta, which opened in 2018.

Station repair project at Mujib year

In 2022, a project was initiated for the “Bengali Year Celebration” at a cost of nearly Tk 2 billion, aimed at repairing 55 stations and raising platform heights. This also included the repair of 50 coaches and some railway lines.

Railway sources said that the modernized Chattogram and Khulna stations were also repaired under this project. The Chattogram station had been modernized at a cost of Tk 2.15 billion, while the Khulna and Benapole stations were modernized for Tk 850 million under one project.

Although trains do not stop at Bangladesh Agricultural University in Mymensingh and the Joshodolpur station in Kishoreganj, both stations were modernized under the Mujib Year project.

Railway officials said that the project during the Mujib Year was initiated at the interest of the then railway minister Nurul Islam Sujan. Many of these projects were unnecessary, and the quality of work was poor.
Lack of focus on service

During the past 15 and a half years of the Awami League government, over Tk 710 billion was spent on major projects for railway lines, stations, and infrastructure. However, due to a lack of necessary engines and coaches during this time, the number of trains could not be increased.

According to railway records, there are about two thousand passenger coaches, of which approximately 1,500 are usable. The rest remain in facilities for repair work. As a result, the same coach is used on multiple routes, making it difficult to run trains according to schedule. The railway has about 300 engines, with 180 of them being over 20 years old, which are considered out of date.

Professor at the Civil Engineering Department at BUET Md Hadiuzzaman said that the main goal of building large stations was to give the projects a 'mega' status. The primary goal of the railway is passenger service, which is currently nonexistent. Local trains are being discontinued due to a lack of engines and coaches, and trains are being forced to run on different lines. Therefore, without a comprehensive approach, the construction of station buildings and new railway lines is nothing but waste.

*This article, originally published in Prothom Alo print and online editions, has been rewritten in English by Rabiul Islam​

 

[Saif]

A new addition to Benazir’s legacy of deceit

Corruption, grabbing minority lands to build resorts and using excessive force to crush dissent -- the name of Benazir Ahmed, once one of the most powerful figures in the country’s law enforcement, has long been synonymous with deceit or fraud.

www.thedailystar.net

A new addition to Benazir’s legacy of deceit
Former IGP concealed his profession, skipped verifications to get four passports, says ACC

Corruption, grabbing minority lands to build resorts and using excessive force to crush dissent -- the name of Benazir Ahmed, once one of the most powerful figures in the country's law enforcement, has long been synonymous with deceit or fraud.

Adding to the former police chief's notorious legacy, he has been found to have obtained multiple passports by misrepresenting his professional status and bypassing mandatory verifications.

Hiding his real identity, Benazir fraudulently acquired three Machine-Readable Passports (MRPs) and an e-passport by claiming to be in private service.

The Anti-Corruption Commission, after conducting a thorough investigation, uncovered the passport fraud involving Benazir, who held top roles such as the commissioner of Dhaka Metropolitan Police, director general of the Rapid Action Battalion, and the inspector general of poilce between 2010 and 2020.

The findings have led to a formal case being filed against him and four officials from the Department of Immigration and Passports.

The investigation revealed that Benazir not only misused his power to sidestep the mandatory Special Branch (SB) verification, but also skipped obtaining a no objection certificate from his department, which is required for government employees applying for a passport.

ACC Deputy Director Hafizul Islam filed the case on Sunday with its Integrated District Office-1 in Dhaka.

The accused consist of former directors of the Divisional Passport and Visa Office in Agargaon -- Fazlul Haque, Munshi Muyid Ikram, and Md Abdullah Al Mamun -- along with Sahena Haque, a technical manager for the e-passport and Automated Border Control Project.

The scheme began on October 11, 2010, when Benazir, then serving as deputy inspector general, surrendered his handwritten passport (No E0017616) and applied for an MRP.

On his application, Benazir falsely listed his profession as "private service", bypassing an NOC. Fazlul Haque, despite knowing Benazir's true identity, approved the issuance of an ordinary passport without conducting any SB verification.

The same tactic was repeated on two subsequent occasions -- once in 2014 while Benazir was the DMP commissioner and again in 2018 when he was director general of Rab.

In each instance, the officials involved turned a blind eye, allowing Benazir to secure new passports without proper scrutiny.

The most recent case came in 2020 when Benazir applied for an e-passport, this time with the help of co-defendant Abdullah Al Mamun, again bypassing the SB verification and NOC requirements.

The accused officials conspired with him in violations of Penal Code sections related to cheating, forgery, and abetment, as well as the Prevention of Corruption Act, 1947, and the Bangladesh Passport Order, 1973, as per ACC sources.

ACC Director General Akhtar Hossain said Benazir's actions constitute a blatant breach of the law.

In an investigation launched in April, the ACC began probing allegations of illegal asset accumulation by Benazir, his wife Zeeshan Mirza, and their two daughters.

Selina Banu, additional director general of the department of immigration and passports, said, "SB verification is mandatory for government officials. However, in these cases, Benazir Ahmed resorted to fraud."​

 

[Saif]

Changing the culture of public fund embezzlement

It was said that public money accounts for only 14-15 per cent of the gross domestic product (GDP) of Bangladesh. Apart from distribution of this money, the government can take measures such as raising or reducing taxes, enhancing or ignoring social security, giving licence or lease, providing...

en.prothomalo.com

Changing the culture of public fund embezzlement
Khawaza Main Uddin
Published: 17 Oct 2024, 16: 38

What are the best and most effective ways and means to utilise properly public money deposited with the national exchequer or in other words to distribute it among the people in a just manner, in tomorrow’s Bangladesh?

Such a question came to the fore at a consultative meeting on ‘public financial management’ organised jointly by the World Bank and the Ministry of Finance in Dhaka recently.

It was said that public money accounts for only 14-15 per cent of the gross domestic product (GDP) of Bangladesh. Apart from distribution of this money, the government can take measures such as raising or reducing taxes, enhancing or ignoring social security, giving licence or lease, providing opportunity to invest or supply, and announcing suitable monetary policy to make a significant portion of the people rich and offer subsistence to others. If the government decides to offer privilege to certain persons or businesses, it can give them scope to invest or supply goods and services accordingly.

We witnessed the policy of appeasing the people close to the previous party in power as the annual national budget was authored in order to ensure interests of the loyal persons and business groups. We had seen, in the past one and a half decades, how the greedy eyes of the vultures were focused on this ‘small amount’ of budgetary money!

According to rough estimates, public money amounting to US$60 billion has been embezzled in the past 15 years. In addition to this, the country had lost revenue to the tune of another US$60 billion, at least, thanks to financial crimes such as money laundering, smuggling, extortion, bribery, illegal commission, unjust financial concessions and incentives, corruption in government procurement and tax evasion.

All these stolen assets belonged to the people. The total estimated amount (to be equivalent to US$120 billion) would have been enough to pay off the country’s entire accumulated foreign loans.

This further means that the amount each Bangladeshi had lost is equivalent to their per capita foreign debt but some ‘fortunate’ men and women had captured the money, the chunks of which containing no less than Tk hundred and even thousand crore (each crore means 10 million), were perhaps deposited with mysterious bank accounts at home and abroad, used in purchasing properties or given shelter in the houses of thugs.

In newly independent Bangladesh in the early seventies, Mr Sheikh Mujib, the first president, said, "I brought 7.5 crore blankets for the 7.5 crore population. Where is mine?"

Likewise, today’s youth can say in chorus, "Where have our shares of the plundered national resources gone?"

Mujib’s daughter Sheikh Hasina had, without any hesitation, spoken of the scams that took place during the reign of her prime ministership. Her domestic help, too, earned Tk 400 crore!

The moment they were fleeing the Ganabhaban, the former prime minister’s official residence, on 5 August 2024, Sheikh Hasina and her sister Sheikh Rehana had taken away a huge amount of dollars, worth several hundred crore taka, some officials told others.

We also heard that a bureaucrat responsible for the former prime minister’s office managed to earn ill-gotten money amounting to more than Tk 1,000 crore in the first five years of her regime.

Allegations have it that following the fall of Hasina through the July-August revolution, quite a few former ministers, Awami League leaders and police officers had to spend money in a range of Tk 200-600 crore to secure safe exits from the country.

The first and foremost task, of course, is to ensure free flow of accurate information of the public money and thus empower the people. For the whole purpose, what must prevail is democracy.

Should we believe that those who paid the money to the once powerful people did so for no benefits of them? Those transactions were not supposed to have taken place in written forms either!

However, when bamboo was used in place of steel in building road infrastructure, it was understood how and in whose pockets this money had gone to. Credit to the ‘Awami-style good governance’, the cost of Padma Bridge project had tripled and that of Rooppur Nuclear Power Plant doubled. Unsurprisingly, the price of electricity imported from Adani’s plant in India became exorbitantly high.

The vicious cycle did not come to an end there. A member of the Sheikh family, who is a lawyer politician, allegedly made money by ‘selling bail’ granted by the court. The extremely clever Awami League administration fearing litigation given the massive corruption committed by its people, had offered indemnity in advance to the former energy adviser to the prime minister.

Dwelling on the Hall-Mark Loan forgery involving more than Tk 4,000 crore, during the initial period of the Hasina rule, the then finance minister, AMA Muhith, said this lost amount was not that high (compared to amounts lost in scams elsewhere). The people got shocked and amused a bit by his words but when many other scams involving much higher amount came to the limelight later on, they realised that the late finance minister did not say anything wrong. He perhaps anticipated that Hall-Mark was just the beginning.

Be it misappropriation of public money or earning money by abusing power, a section of people of different backgrounds were involved in these criminal activities.

They all actually formed only one party which may be called mafia and they had a ‘caring mother’ as well. Not always having the ethos of sophisticated citizens, each of them was the specially privileged member of the oligarchy. They did not also hide their status.

Prior to the farcical elections held in January 2024, media reports showed that a group of businessmen were chanting the slogan: "The government of Sheikh Hasina, is needed time and again." These creatures, some businessmen and their hired executives alike, often bragged that "we the businessmen run the government by paying tax."

As if the job holders and others are not at all taxpayers and the middle and lower middle class people do not pay value added tax which is supposed to be paid by the manufacturers, service providers and sellers.

The surplus (profit) money earned by these groups swell only when consumers of products and services buy them – the relation or process to which they are generally oblivious. Because if say "abracadabra" like that of the gang leader of Ali Baba and 40 Thieves in the Tales of the Arabian Nights, to open the door of the place where stolen assets were kept, the money from the consumers come to their pockets as value addition.

Such people expressed their arrogance by insinuating publicly that it is only they who pay tax and run the government. Their bragging is so similar to Sheikh Hasina’s statement that "I arrange food to 16 crore (people)’!

Thus, they had been successful in turning Bangladesh into an ‘El Dorado’ with permanent arrangement for plundering public resources by depriving the people of their right to vote and elect their leaders!

There was no barrier left to using public resources as forefathers’ properties and distribute them as gifts to whatever Hasina liked during her reign. The results were obvious: massive corruption, limitless plundering and siphoning off of national resources and making the country almost bankrupt.

Decisions to undertake highly expensive projects wherever in Bangladesh were in many cases finalised, not at the ministries of planning and finance or not keeping research organisations and development thinkers informed about the moves. Rather, such decisions were made by mafia ‘guys’ including local and foreign power brokers, businessmen having hobnob with the powerful quarters, ministers, and Awami bureaucrats.

At the World Bank’s consultative meeting, this author was asked what the tasks for authorities concerned and stakeholders are for solving the problems relating to formulation of the budget and its execution, in times of the ongoing reforms and prior to the expected political transition to the elected government.

The first and foremost task, of course, is to ensure free flow of accurate information of the public money and thus empower the people. For the whole purpose, what must prevail is democracy.

To make this process easy and smooth, it is necessary to ensure participation of the common people in the preparation of the budgets of union council, municipalities and city corporations, and upazila (sub-district) and district councils.

In our country, even the genuinely elected members of parliament were not in the past provided with fair opportunity to formulate the budget, their constitutional duty in fact. Also there was a lack of interest and proper knowledge of the subject among them, turning the budget-making process into a bureaucratic exercise.

Since the budgetary money belongs to the people, they must be told in easy, non-technical language how the public money will be and is allocated and spent.

So, potential members of parliament and other politicians should be made aware of the budgetary matters and issues so that the people can get clear ideas about the budget. The members of parliament should be empowered in terms of knowledge for speaking in favour of public interest.

Still, the culture of embezzling public money will continue as a matter of right for the corrupt elements unless the oligarchical system of the Hasina period is defeated and re-emergence of such forces can be stopped.

Through reform initiatives, the people should be incentivised to pay taxes. The private sector needs to be decentralised so that new entrepreneurs can be made. The banking sector should also be reformed. Development that harms environment must be avoided.

These issues are not just of the current administration and its tenure. Reforms cannot be imposed either – they must be homegrown.

For meaningful change, institutions should be built in conformity with local culture, needs and the choice of the people. Bureaucracy should be readied for serving the owners of the republic, the people.

* Khawaza Main Uddin is a journalist.​