Treasury heads of 10 banks fined Tk1 lakh each for selling US dollars at higher rates

The Bangladesh Bank has fined Tk100,000 to the heads of treasury departments of 10 banks for selling US dollars at a higher price than the government's fixed price.

The central bank informed the banks about the penalty in a letter sent to the banks on  Wednesday (27 September).

The banks that have been fined are - Social Islami Bank Limited, Al-Arafah Islami Bank Limited, Mercantile Bank PLC, Modhumoti Bank Limited, Midland Bank Limited, Brac Bank Limited, EXIM Bank, Premier Bank, Shahjalal Islami Bank and Trust Bank.

Earlier, the central bank had issued show-cause notices to the heads of the treasury department of 10 banks asking them "why disciplinary action should not be taken" after investigating allegations of selling dollars at high prices.

The banks responded to the notice but were reportedly fined since their response was not acceptable to the central bank.

In the letter sent to the banks, it said, "The reply submitted by you regarding the additional cost of buying and selling dollars could not be accepted after consideration. Therefore, as per Section 109 (7) of the Bank Companies Act, 1991, your Head of Treasury Department is personally liable and a penalty of Tk1 lakh has been imposed."

The banks have been directed to inform the Department of Foreign Exchange Policy after depositing the penalty amount in the "General Accounts – Head Office" sector at the Motijheel office of the central bank within the next 14 days.

The head of the treasury department of one of the banks that faced punishment told The Business Standard, "We are discussing among ourselves whether we will apply to the central bank for a waiver of the fine or pay the fine."

A senior official of a private bank said, "At least 3 banks were investigated by the central bank in addition to the penalised banks."