No action against fake importers as permission delayed

On September 1, 2018, Chattogram Customs House found evidence of money laundering in a consignment imported by Progress Impex Ltd, an importer in Dhaka's Banani.

The importer announced in the invoice that Double A brand paper had been brought in from Singapore through the Chattogram port, but the port customs found 410 sacks of sand in the container. For that import, about $15,000 was sent to Dalian Rishangbo Commercial, a Chinese exporter.

Chattogram Customs identified the incident as a money laundering case but could not take any action against the accused in the last two years. It has been awaiting permission of the National Board of Revenue in order to file a case in this regard.

Meanwhile, the customs official who had written to the Bangladesh Bank to collect information in the incident to file a money laundering case has already left the country on educational leave.

Earlier, there was no law on filing cases against money laundering in the country. In 2012, the Money Laundering Prevention Act was passed, through keeping the provision that cases could be filed with prior permission of the Bangladesh Bank.

However, the process of obtaining the permission proved to be very cumbersome. As a result, Chattogram Customs could not lodge any money laundering case despite possessing a lot of evidence in hand.

An anti-money laundering unit was formed at Chattogram Customs House on September 26, 2018 but it could not begin working for about one year due to various complications.

In September 2019, the National Board of Revenue was allowed to file cases under the Money Laundering Prevention Act but only after obtaining primary information from the central bank.

Complications in filing cases under the relevant law did not go away. As a result, Chattogram Customs was able to file only four cases in the last one year. Besides, it has been waiting for eight months after applying to the central bank seeking primary information regarding banking transactions in order to investigate 13 money laundering incidents.

This is not the end of the story.

After primary information is obtained, a decision on the case is taken in coordination with the National Board of Revenue and the Financial Intelligence Unit (BFIU) of the Bangladesh Bank. It also takes a long time to get that permission. According to the BFIU, this coordination meeting is held every three months.

Chattogram Customs House Commissioner Mohammad Fakhrul Alam said, "We cannot file a case directly under the Money Laundering Prevention Act. Verification of information is required to file a case."

He also said after getting primary evidence of money laundering, a letter was sent to those 13 importing companies for banking information. But a reply is yet to be received. Often obtaining information is delayed and the customs officer concerned is mostly transferred in the meantime. The new officer who takes over does not show any interest in the case.

"Due to various complications, we could not file a case even after the money laundering prevention law was passed in 2012. I could file only four cases in the last one year after taking charge," Fakhrul added.

People concerned are of the view that due to lack of timely steps, the customs authority cannot take effective action against money launderers even after they are found involved in the crime.

Nur-A-Hasna Sanjida Anusuya, assistant commissioner at the Audit, Investigation and Research unit of Chattogram Customs, told The Business Standard, "We have found primary evidence of money laundering in five other incidents and are waiting for permission from the National Board of Revenue to file lawsuits."

Dr Moinul Khan, former director general of the Department of Customs Intelligence and Investigation and currently director general of VAT Intelligence, said the important information required to sue under the Money Laundering Prevention Act includes information on importers and imported goods and their bank transactions.

Although the first two issues are under the purview of the Customs House, the Bangladesh Bank has the details on importers' banking transactions. A case can be lodged if all the information is investigated and evidence is found. However, it takes some time to coordinate the activities of all the organisations, he added.

Abu Hena Razi Hassan, head of the BFIU, said, "We reached an agreement with the National Board of Revenue in 2019 under which we provide them with the relevant information."

However, it takes some time to provide the information because taking information from different banks is time-consuming too, he added.

The relevant quarters often do not want to give information as provided for under the rules, he added.

Another senior BFIU official, on condition of anonymity, said there are 57 banks in Bangladesh and, if the information relating to one person is sought, it has to verify the data of all 57 banks.

"For example, an importer has transactions with 12 branches of Sonali Bank. If we want information from Sonali Bank about him, the bank will have to give information from all 12 branches. So, it takes time," he pointed out.

"Again, we have to check whether they have given false information. Otherwise, the importer will be spared even after the case is filed," he added.

Chattogram Customs House sources said that from July 2019 to June 2020, 2,995 suspicious shipments were examined from where 1,448 irregularities were detected. During this period, 373 invoices were not examined.

In these cases, Chattogram Customs House got additional revenue of Tk142.5 crore, including Tk36.46 crore in fines and Tk105.4 crore in additional revenue.

According to Chattogram Customs House, there is a possibility of money laundering in 30 percent of such consignments but they cannot be checked physically due to a manpower crisis.