Effective Initiatives Must be Taken to Recover Laundered Money
An estimated Tk 27 lakh crore was laundered out of Bangladesh during former PM Sheikh Hasina’s tenure, according to claims cited in the report. The figure could be even higher if the value of talent migration and related losses is taken into account. A strong economy, a stable banking sector and an investment-friendly environment are key pillars of a modern state. Critics have accused the previous government and politically connected business groups of weakening these institutions through widespread corruption, irregularities and financial mismanagement.
After taking office, the interim government led by Dr Muhammad Yunus faced major economic challenges. It worked to strengthen foreign exchange reserves while meeting the country’s foreign debt obligations. There were also expectations that the interim government would take effective steps to recover money allegedly laundered abroad. However, progress in recovering the funds has remained limited. Prime Minister Tarique Rahman has identified the recovery of laundered money as a government priority. The objective is to address economic challenges and support business, trade, investment and employment. However, six months into the elected government, progress in this area has reportedly fallen short of expectations.
The appointment of a new chairman and two commissioners to the Anti-Corruption Commission (ACC) has raised hopes that the government will accelerate action against corruption and money laundering. At the same time, concerns remain over the effectiveness of the task force responsible for recovering stolen assets. According to a report published by Inqilab, the task force formed during the interim government to recover stolen assets and laundered money includes officials from institutions whose officials or former officials have themselves faced allegations linked to money laundering during previous periods.
The report claims that officials connected to the former prime minister’s family, ministers, senior security officials, influential bureaucrats, Bangladesh Bank officials and directors and officials of various banks were included in the task force. It further alleges that such conflicts of interest have hampered the task force’s work. According to the report, for nearly two years, the process has been marked by meetings, correspondence and legal complications rather than significant progress. These developments have raised concerns that efforts to recover large sums of money could be delayed or weakened.
Questions have also been raised about the lack of visible progress by the ACC after the formation of an ACC-led Joint Investigation Team (JIT) on December 24. Earlier, on September 29, 2014, an “Inter-Agency Task Force on Stolen Assets Recovery and Management” was formed. The task force includes 11 agencies, including the Criminal Investigation Department (CID) of police, the National Board of Revenue’s Central Intelligence Cell (CIC), Customs Intelligence and Investigation Directorate (CIID) and other relevant agencies. The Bangladesh Bank governor leads the task force.
Given the limited progress, there are calls to review the task force’s mandate, working methods and achievements and consider restructuring it if necessary. Similar concerns have been raised about previous anti-money-laundering task forces, with critics arguing that agencies sometimes lacked the independence or capacity needed to investigate politically connected individuals. Relevant agencies already have access to significant information about the methods allegedly used to transfer money abroad and the people involved. Alleged methods include fake letters of credit, over-invoicing, under-invoicing, false declarations, hundi, cryptocurrency transactions and transfers made without importing goods.
The report also alleges that individuals linked to the former government, including members of the Sheikh family, politicians, military and civilian officials, bureaucrats and business figures, transferred large sums abroad through proxy companies and other business entities. Some of these individuals are now living overseas. There are also allegations that some people involved in financial irregularities continue to maintain links with bankers, bureaucrats and business figures in Bangladesh. Authorities have been urged to investigate such connections and prevent further illicit transfers of money abroad.
On the other hand, it has been emphasized by experts and stakeholders alike that it was important to break down barriers and increase transparency in domestic investments. In the attempt to retrieve laundered money, it was important to differentiate between honest and dishonest businesses so that honest investors do not get harassed. The new ACC, under reconstruction, is under pressure from public opinion. The commission is expected to investigate corruption and money laundering independently and ensure accountability. The government has also been urged to ensure close coordination between the task force, the ACC and foreign law firms already engaged in efforts to recover assets transferred abroad. Ultimately, those found responsible for illegally transferring public or private funds abroad must face the law. Meanwhile, the whole process should be open and based on empirical evidence, without any kind of political manipulation.
