Reserve theft probe report details BB officials’ involvement

A government-formed probe committee found involvement of Bangladesh Bank officials in the theft of $101 million from the central bank reserve with the Federal Reserve Bank of New York in February and recommended legal actions against them.
The three-member probe committee led by former Bangladesh Bank governor Mohammad Farashuddin came up with the finding and the recommendation in its final report on the biggest-ever reserve theft that already hit the headlines in global media.
Finance minister AMA Muhith said the final probe report would be made public in 15-20 days.
‘It is my promise’, he told reporters after receiving the probe report.
Muhith said he would remain busy until announcement of the national budget on June 2.
‘Then I will go through the report before making it public in next 15-20 days,’ he said.
In the report, submitted to finance minister AMA Muhith at the ministry on Monday, the committee recommended that both legal actions under the law of the land and departmental action under the Bangladesh Bank rules should be taken against the officials found responsible for the theft, officials said.
Farashuddin admitted that they had detailed the involvement of central bank officials in the reserve theft in the final report while talking to reporters after submitting the report.
The Identity of the officials should not be disclosed now because of technical reasons, he said.
Farashuddin said they were happy that they could submit the full report within the 75-day timeframe after submitting the interim report on April 20.
He mentioned that they took technical supports from two teachers of the Bangladesh University of Engineering and Technology for the preparation of the final report.
Society for Worldwide Interbank Financial Telecommunication cannot avoid responsibility for the reserve theft, he said, adding that the probe committee found that SWIFT network was compromised.
The committee made seven recommendations including cancellation of existing two-day weekly holidays for the central bank officials. It recommended that Sunday should be declared the weekend for the central bank.
The probe committee members were convinced that three-day holiday – Friday and Saturday in Bangladesh and Sunday in the others countries – created scopes for sending 35 illegal transaction orders using the facilities of the Bangladesh Bank to release about $1.2 billion from its accounts in the US Federal Reserve, officials said.
Only five of the 35 illegal transactions were approved by the Federal Reserve resulting in the release of $101 million – $20 to Sri Lanka and $81 million to Philippines.
The Sri Lankan central bank blocked the money because of suspicious transaction but the Philippines’ central bank channelled out the money in the banking channel and most of those were laundered in casinos.
Officials said that the probe committee recommended that the government should take measures to recover the stolen fund with coordinated efforts between the government bodies and international agencies.
They said that the probe body also recommended that special security arrangement should be made for the information technology department of the central bank and the recruitment of IT officials should be completed after ‘serious scrutiny.’