[🇧🇩] Everything about Hasina's misrule/Laundered Money etc.

Saif · Nov 28, 2024

What’s the point of revolution if ill-gotten wealth not reclaimed?

Noted economist Debapriya Bhattacharya has raised the question as to why the massive wealth accumulated through looting and corruption during the previous regime has not been reclaimed by the state yet.

www.thedailystar.net

What’s the point of revolution if ill-gotten wealth not reclaimed?
Debapriya asks

Noted economist Debapriya Bhattacharya has raised the question as to why the massive wealth accumulated through looting and corruption during the previous regime has not been reclaimed by the state yet.

"Where has this wealth gone? Why hasn't it been confiscated yet?" he asked at a seminar at the Economic Reporters' Forum (ERF) auditorium in Dhaka yesterday.

"If this cannot be done, what was the point of the revolution?" he told the programme jointly organised by the ERF and Research and Policy Integration for Development (RAPID).

Debapriya Bhattacharya, chair of the committee preparing the "White Paper on the State of Bangladesh Economy", also questioned why the government has not taken legal action to take back the corrupt wealth and swiftly adjust it.

At the seminar on the "Current Economic Situation and Launching of Open Budget Survey 2023 Results", the economist suggested that confiscating this wealth could have a positive impact, such as encouraging people to pay taxes.

He suggested the government set a six-month target to reduce inflation -- which has been hovering above 9 percent for around two years and hit a three-month high of 10.87 percent in October.

Besides, he called for increasing food security and strengthening the social safety net.

On the macro front, the economist advocated for prioritising the revival of private investment, resolving the tight liquidity and strengthening the energy sector.

To increase public investment, Debapriya said the government should hold a meeting with foreign development partners by December or January next year to inform them about the country's inclusive and sustainable development plan.

Debapriya, also a distinguished fellow at the Centre for Policy Dialogue (CPD), suggested that the National Board of Revenue (NBR) should be digitalised, which would help the government increase revenue collection.

He said the government's measures to lower the inflationary curve have not been effective as price pressures still remain high.

He, however, said that the current high inflation rate was inherited from the previous government.

In his keynote, titled "Fixing the Macroeconomy: A Daunting Task Inherited from the Previous Regime", Mohammad Abdur Razzaque, chairman of RAPID, told the seminar that Bangladesh has been paying the price for the previous regime's reckless macroeconomic management.

The country has faced high inflation, dwindling foreign exchange reserves and a depreciating currency, which was further complicated by poor governance and widespread corruption, Razzaque commented.

Despite the inflationary pressures, the previous government borrowed heavily from the central bank in an unprecedented manner, he said.

The RAPID chairman also credited the interim government for taking some positive steps, such as stopping fund embezzlement in the banking sector, reducing credit demand, increasing remittance inflows, improving bank deposits and expanding exports.

He also said that restoring macroeconomic stability is critical for transitioning out of least developed country (LDC) status. Uncertainty just ahead of the graduation also could deter foreign investment, he said, adding that exporters and investors need predictability.

"For LDC graduation, consider the importance of the Indian and Japanese markets as there will be an additional three-year transition period in other important markets," he added.

As a discussant, Shawkat Hossain Masum, head of national daily Prothom Alo's online edition, said journalists criticised the previous government's reckless economic policies but were rarely heard.

He said the country's economic downturn began in 2019, even before the Coronavirus pandemic, as the central bank's foreign currency reserves dwindled.

"The pandemic and the Russia-Ukraine war further worsened the situation," he commented.

Masum said containing inflation will take more time. However, the government needs to improve public confidence in its steps to counter the price pressures.

During the launching of the Open Budget Survey (OBS) 2023 Bangladesh Results at the same seminar, RAPID Executive Director M Abu Eusuf said Bangladesh has a transparency score of 37 out of 100.

It assesses the online availability, timeliness and comprehensiveness of eight key budget documents using 109 equally weighted indicators and scores each country on a scale of 0 to 100.

A transparency score of 61 or above indicates a country is likely publishing sufficient information to support informed public discourse on the budget.

ERF President Mohammad Refayet Ullah Mirdha chaired the session while ERF General Secretary Abul Kashem moderated the seminar.

Saif · Nov 29, 2024

$14b a year lost to capital flight during AL years

Bangladesh has lost around $14 billion a year on average to capital flight during the Awami League’s 15-year tenure, according to the draft report of the committee preparing a white paper on the economy.

www.thedailystar.net

$14b a year lost to capital flight during AL years
Finds committee preparing white paper

Bangladesh has lost around $14 billion a year on average to capital flight during the Awami League's 15-year tenure, according to the draft report of the committee preparing a white paper on the economy.

The actual amount of capital flight could not be determined due to time constraints, The Daily Star has learnt from members of the 12-member committee. However, a separate chapter has been prepared on the topic using scientific methodology, government documents and global reports.

The committee, which was formed on August 28, was given three months to prepare the report to inform on the true state of the economy, battered from years of mismanagement and data obfuscation.

"We have incorporated the ways money laundering takes place and how it could be stopped," said one of the committee members asking not to be named.

Earlier on November 2, Transparency International Bangladesh said $12 to $15 billion was siphoned out of the country in a year over the last 15 years.

Bangladesh lost approximately $8.27 billion on average between 2009 and 2018 only from mis-invoicing of values of import-export goods by traders to evade taxes, according to the US-based research organisation Global Financial Integrity.

The 250-page report titled "White Paper on the State of Bangladesh Economy" will have 22 chapters, including their findings on GDP growth, inflation, external balance, banking sector situation, power and energy situation, government's debt, quality of statistics, trade, revenue, expenditure, mega projects, business environment, poverty and equality, capital market, education, health, women and climate issues.

The report will be handed over to Chief Adviser Muhammad Yunus on Sunday and made available for public consumption the following day.

The committee -- led by Debapriya Bhattacharya, a distinguished fellow at the Centre for Policy Dialogue -- made its observations on mega projects like Padma bridge and the railway link, the Rooppur nuclear power plant, Matarbari power plant and Karnaphuli tunnel.

"We have incorporated our observations on the corruption charges by the World Bank in the Padma bridge project and the issue of the Canadian court. We have our observations on building the bridge with own funds," said another committee member.

The 6.15-kilometre Padma bridge cost Tk 30,193 crore, or $3.56 billion. Of the amount, $2.4 billion was paid through foreign currency provided by the Agrani Bank.

Total public debt, especially the repayment of foreign loans over the next four years for the ongoing 215 foreign-funded projects, was incorporated in the report, said another committee member.

The committee has suggested pathways to rationalise the huge subsidy expenditure, improve the bad loan situation and strengthen market management for inflation control.

The committee members include economists AK Enamul Haque, Kazi Iqbal, Mustafizur Rahman, Selim Raihan, Sharmind Neelormi, Mohammad Abu Eusuf, Ferdaus Ara Begum and Zahid Hussain; energy expert Mohammad Tamim; and manpower export expert Tasneem Arefa Siddiqui.

Saif · Nov 30, 2024

S Alam's cunning move to shield his empire

A business conglomerate, now infamous for allegedly siphoning billion of dollars from Bangladesh, has issued a threat to the country's central bank governor, indicating its intention to initiate international arbitration procedures against Bangladesh. This development, stemming from the governor's

thefinancialexpress.com.bd

S Alam's cunning move to shield his empire
Asjadul Kibria
Published :
Nov 30, 2024 21:01
Updated :
Nov 30, 2024 21:01

A business conglomerate, now infamous for allegedly siphoning billion of dollars from Bangladesh, has issued a threat to the country's central bank governor, indicating its intention to initiate international arbitration procedures against Bangladesh. This development, stemming from the governor's public disclosure that the conglomerate, S Alam group, allegedly transferred a staggering Tk 1.2 trillion (approximately $10 billion) from Bangladeshi banks to other countries during the tenure of ousted former prime minister Sheikh Hasina, has notable implications for the nation's economy. The news, as reported by the Financial Times, also revealed that the group's owners were seeking to protect their investments as Singaporean under the 1980 Bangladeshi law on foreign private investment. They have further warned of their readiness to invoke the International Centre for Settlement of Investment Disputes (ICSID) to safeguard their investments.

The S Alam group's claim for investment protection is a significant development. As one of the key beneficiaries of the ousted Hasina regime, the group's chairman, along with his wife and three sons, renounced their Bangladeshi citizenship in 2022 and were immediately granted permanent residency in that country. This move, necessitated by Singapore's citizenship law that does not allow dual citizenship, raises questions about the timing of their Singaporean citizenship acquisition. Now, they are seeking investment protection as foreign investors, a move that could have far-reaching implications.

All the investments made by S Alam, chairman, and his four family members, who are also the directors of the conglomerate, before availing themselves of Singapore citizenship were Bangladesh citizens. So, those investments are not FDI from Singapore, and there is no scope to claim protection as foreign investors. It is also important to know how much investment they made after becoming Singaporean citizens.

Statistics available from Bangladesh Bank showed that the net inflow of FDI from Singapore to Bangladesh dropped to US$169.81 million in 2023 from $269.93 million in 2022. The highest amount of FDI from the island country was recorded at $573.05 million in 2016. The stock of FDI from Singapore to Bangladesh stood at $1558.23 million at the end of last year. As the investors' details are not publicly available, the central bank now needs to clarify whether S Alam made any investment as FDI from Singapore or not.

It is also possible that there was a good amount of round-tripping of FDI in the country. The round-tripping of FDI is the flow of domestic funds channelled back into the local economy through direct investment using offshore hubs. In other words, money siphoned or stashed away from Bangladesh to any other country and then brought back as FDI from tax havens is known as round-tripping. It is not easy to detect and estimate it. Nevertheless, through a rigorous exercise, it is possible to identify the round-tripping in some particular cases including S Alam's.

As S Alam wanted to drag Bangladesh into an investor-State dispute, it had to do so by invoking the Bangladesh-Singapore Bilateral Investment Treaty (BIT). The treaty, signed in 2004, outlines the legal provisions to do so in Article 7 of the treaty. It said that any dispute "shall, as far as possible, be settled amicably through negotiations between the parties to the dispute." It is the first step to resolve the dispute, where the parties must move through negotiations or consultations. If the parties fail to resolve the dispute through consultation, they can go for arbitration by the ICSID, as per Paragrah-2 of Article 7 of the treaty.

As the BIT was signed two decades ago, it clearly favoured the investor at the expense of the host state, and that was the trend at that time. Experts observed that BITs often provided for 'disproportionate protection of investors and deprived the host states of some of the fundamental rights'. These include the protection of health, the environment and national treasures. Moreover, in several dispute settlement lawsuits, big amounts of compensation for damages were imposed against developing countries. After facing such backlash by foreign investors, developing countries have recently started revising the BITs to make these balanced. India is one of the leading nations in this connection.

Bangladesh has signed 34 BITs so far. Two were terminated, and seven are still not enforced. The country signed its first BIT with the United Kingdom (UK) in 1980 and the last one with Kuwait in 2016. The country also faced eight lawsuits by foreign investors at ICSID of the World Bank Group, all of which were in the power and energy sector. Of these, three are still pending.

Investor-State Dispute Settlement (ISDS) is costly for states, especially for developing nations like Bangladesh. In many cases, foreign investors can deploy highly qualified and experienced lawyers on their behalf, which is difficult for developing nations. Lack of understanding of the significance of BITs is another problem for the states as these were designed skilfully to favour international investors. The vague and broad language of BITs put the developing nations in trouble as many of arbitration awards by the arbitration tribunals went against the host states. Some analysts also argued that in many cases, arbitration tribunals' treated sovereign regulatory measures of host states as breaches of BITs.' Moreover, some of these 'awards imposed on the host states large amounts of damages.'

The S Alam group's threat to involve Bangladesh in an Investor-State dispute serves as a warning for the country to re-evaluate its BITs. This threat could potentially pave the way for other foreign investors to follow suit, especially if the government is compelled to re-examine major foreign investment projects in the public sector. Notably, investments from China and India have seen a significant increase in the past decade, with allegations that the Hasina regime awarded contracts in violation of various laws and in exchange for bribes.

Saif · Dec 1, 2024

Seizure of S Alam Group shares ordered

The Chattogram Artha Rin Adalat has ordered the seizure of shares held by S Alam Group chairman Saiful Alam and his brother Abdus Samad with two banks, in connection with a Tk 2,000 crore loan default at Janata Bank.

www.newagebd.net

Seizure of S Alam Group shares ordered
Staff Correspondent . Chattogram 02 December, 2024, 00:34

S Alam Group chairman Saiful Alam.

The Chattogram Artha Rin Adalat has ordered the seizure of shares held by S Alam Group chairman Saiful Alam and his brother Abdus Samad with two banks, in connection with a Tk 2,000 crore loan default at Janata Bank.

The court also directed the Anti-Corruption Commission to investigate the circumstances surrounding the massive loan irregularities.

Judge Mujahidur Rahman of the Chattogram Money Loan Court issued the order on Sunday, said plaintiff’s lawyer Md Shafiqul Islam Chowdhury.

The shares in question are held at Al-Arafah Islami Bank and First Security Islami Bank, Shafiqul Islam said.

Shafiqul Islam said, ‘S Alam has shares of First Security Islami Bank, while his brother Abdus Samad Lavu owns shares of Al Arafah Islami Bank. The court has instructed the seizure of these shares based on our application. Additionally, the ACC has been tasked with probing how such a significant irregularity in the Tk 2,000 crore loan occurred.’

The case was filed earlier in the day by Satyajit Ghosh, an officer at Janata Bank’s head office and its Sadharan Bima Bhaban Corporate Branch.

According to a 2021 audit report by the Comptroller and Auditor General (CAG) of Bangladesh, Global Trading Corporation, a subsidiary of S Alam Group, has secured loans exceeding the approved limit in violation of Bangladesh Bank regulations.

Initially, in 2012, the company obtained a loan of Tk 650 crore from Janata Bank’s Chattogram Corporate Branch at Sadharan Bima Bhaban.

By 2021, the loan had reached Tk 1,070.65 crore, including interest and principal. This amount comprised Tk 61.47 crore as Payment Against Document, Tk 223.18 crore as Loan Trust Receipt, and Tk 229.99 crore as Cash Credit (Hypothecation) loan.

By September 2024, the total outstanding, including accrued interest, had surged to Tk 1,850 crore.

According to S Alam Group’s website, Global Trading Corporation, established in 2012, specializes in industrial raw materials, commercial products, and construction materials.

Saif · Dec 3, 2024

Court for freezing foreign assets of Bashundhara chairman, family members

The court also ordered the ACC to publish order in the government official gazette along with widely circulated newspapers for information of the citizens

www.thedailystar.net

Court for freezing foreign assets of Bashundhara chairman, family members

Photos: Collected

A Dhaka court has ordered to freeze foreign assets of Bashundhara Group Chairman Ahmed Akbar Sobhan Shah Alam and eight family members, its MD Sayem Sobhan Anvir, in six countries and two offshore jurisdictions.

These assets include bank accounts, real estate, and business holdings.

The family members are: Shah Alam's wife Afroza Begum, his sons Sayem Sobhan Anvir, Bashundhara managing director, Sadat Sobhan, Shafiat Sobhan, vice-chairman of the conglomerate, and Safwan Sobhan and; Sadat's wife Sonia Ferdowshi Sobhan; Anvir's wife Sabrina Sobhan and Safwan's wife Yasha Sobhan.

Judge Md Zakir Hossain of Dhaka Metropolitan Senior Special Judge's Court on November 21 passed the order after Anti-Corruption Commission Deputy Director Nazmul Hussain, who is the head of the inquiry team, submitted an application in this regard.

The order, issued under the Money Laundering Prevention Act 2012, will remain in effect until further notice, the court said.

ACC Public Prosecutor Mir Ahmed Ali Salam moved the application on behalf of the anti-graft body.

It concluded that Shah Alam and his family amassed huge wealth beyond their disclosed sources of income through illicit means and subsequently, laundered to locations, including the United Arab Emirates, Slovakia, St Kitts and Nevis, Switzerland, the British Virgin Islands, the United Kingdom, Singapore and Cyprus.

Copies of the court order were sent to the State Register of Slovakia, Citizens International of St Kitts and Nevis, Chamber of Commerce and Industry of Switzerland, British Virgin Islands ministry of financial services labour and trade, UK Department for Business and Trade, Singapore Exchange of Singapore, chairman of Habib Bank in the United Arab Emirates chairman, and chief executive officer of the ministry of interior and Department of Lands and Surveys of Cyprus for necessary action as per mutual legal assistance request.

The court also ordered the ACC to publish order in the government official gazette along with widely circulated newspapers for information of the citizens.

The court also asked its office to send the order to the secretaries of the ACC, the Public Security Division of the home ministry to communicate the order with Mutual Legal Assistance Request for subsequent actions in regard to execution of the order.

The commission provided details of property acquired abroad in the name of Shah Alam and his family members to the court.

The inquiry found that they took huge amounts of loans in the name of their companies from different banks, laundered a portion of the loans outside Bangladesh and purchased assets and invested in different companies in those countries and offshore havens.

As Bangladeshi nationals, they were bound to apply to the Bangladesh Bank seeking permission to transfer any capital outside Bangladesh, but they did not do so, the commission stated in the petition.

Besides, they were bound to declare all legal incomes and assets in their income tax returns to the National Board of Revenue, but they did not do so, said the petition.

Anvir obtained citizenship by investing 3 million euros in Slovakia and Yasha Sobhan spent 2 million euros to obtain citizenship in Cyprus. Shah Alam and his wife Afroza got citizenship by investing $25 million in St Kitts and Nevis, stated the petition.

They and their sons and daughters-in-law invested in 19 companies in these countries and bought houses in Cyprus, it added.

Safwan and Sonia Ferdowsi have opened bank accounts in Habib Bank in the UAE and Eurobank in Cyprus and transacted illegal money through the accounts, it stated.

From the Habib Bank account of Safwan, 287.5 million euros were transferred to Sonia's Habib Bank account which was remitted to Cyprus. They have $3,56,970 in their accounts, the petition stated.

Sonia Ferdowshi was beneficiary or shareholders or directors in a number of companies in British Virgin Islands that included Asimina Consulting Inc, Francatina Development Inc, Soms Group SA, Akebia United SA, Norea Holdings Limited, Evelina Lordanova Ivanova, Stat Holdings Services, Francatina Development Inc and Cordyline Universal SA, according to the commission.

Besides, an investigation, conducted by The Observer in collaboration with the Transparency International, has revealed the information in a report published in the British daily Guardian on Sunday.

The report stated that family members of Akbar Sobhan owned two vast properties in the United Kingdom, acquired for a combined £13 million and owned via companies registered in the British Virgin Islands, Golden Oak Venture Limited and Kaliakra Holdings Limited.

On October 6, the Bangladesh Financial Intelligence Unit (BFIU) asked banks to freeze all personal accounts of the Bashundhara Group chairman and his family members

On October 21, the same court issued a travel ban on Akbar Sobhan and eight members of his family in connection with corruption allegations.