Hundi traders laundered Tk75,000cr in a year via MFS: CID

A syndicate of hundi traders has laundered around Tk75,000 crore in the last one year through different Mobile Financial Services (MFS) in the country, according to the Criminal Investigation Department (CID).

Around 5,000 MFS agents have laundered some Tk25,000 crore through hundi in the past four months alone, the CID told the media following the arrest of 16 members of a gang, including the mastermind behind the money laundering.

The suspects – agents of bKash, Nagad, Upay, and Rocket – used to run a digital hundi racket to bypass the legal banking system, said CID Chief Mohammad Ali Mia at the press conference organised at the CID headquarters in Malibagh in the capital on Thursday.

Asked how responsible MFS companies are for illegal transactions, the CID chief said, "The Bangladesh Bank will look into it. Those arrested are MFS agents, so the companies should increase vigilance in appointing agents and monitoring [them]. The CID will hold a formal meeting with the companies."

However, MFS officials said they regularly monitor their agents' activities and share information on unusual transactions with law enforcement agencies and the Bangladesh Financial Intelligence Unit (BFIU) of the Bangladesh Bank.

A decrease in remittances sent by expatriates came up in a recent probe conducted by the BFIU.

Based on its information, the members of the hundi gang were identified and arrested in three separate drives conducted in Dhaka and Chattogram on Wednesday.

The CID seized over Tk10 lakh in cash, digital money amounting to almost Tk3.5 crores, 33 SIMs, 34 mobile phones, three laptops, hard drives, tabs, modems and cheque books, among other things.

The arrestees are Akhter Hassan, Didarul Alam Sumon, Khurshed Alam Emon, Rumon Kanti Das Joy, a bKash distribution house CEO Rashed Manjur Firoz, bKash distribution sales supervisor Md Hussainul Kabir, Nabi Ullah, Md Junaidul Haque, Adibur Rahman, Asif Nawaz, Farhad Hussain, bKash agents Abdul Basir, Mahabubur Rahman Salim, Abdul Awal Sohag, Fazle Rabbi and Shamima Akhter, the mastermind behind the money laundering gang.

The CID arrested them in three separate money laundering cases filed at Mohammadpur and Khilgaon model police stations in Dhaka and Kotwali police station in Chattogram. 

As per the CID's findings, the launderers work in three groups. The first group collects money in foreign currency from expatriates. The second group pays the converted amount to the MFS agents in Bangladesh. The third group, all working for different MFSs, send the designated amount of money to the numbers provided by the expats.

According to a BFIU report, despite the increase in exporting manpower abroad, remittances through banking channels have been on a decline. Even after foreign travel has been discouraged in many ways, there has been a huge shortage of cash dollars in the country's market.

Expatriates sent $21.03 billion dollars through the banking channels in FY22, which was $3.75 billion (15%) less than the previous year.

Shamsuddin Haider Dalim, Head of Corporate Communications of bKash, told TBS that none of those arrested in the CID operations are direct employees of bKash. They are employees of bKash's local distribution agents. 

"Furthermore, in mid-August bKash severed all business ties with the Chattogram distribution company – Salim & Brothers Distribution House – whose distribution sales officer and agents were arrested for allegedly making suspicious dealings."

Another bKash senior official told TBS that bKash shares the Suspicious Transaction Report (STR) and Suspicious Activities Report (SAR) with the BFIU and law enforcement agencies every month. The law enforcers conduct operations on the basis of such information.

Zahidul Islam Sajal, head of communications of Nagad Limited, also told TBS that the Nagad compliance team detects unusual transactions through continuous monitoring and reports suspicious transactions to the BFIU.

Earlier, when remittance flow decreased in 2018, the CID arrested seven agents from across the country on charges of laundering money through bKash. However, there was no further progress in this regard after that drive.

CID officials said this time they will continue conducting drives against the money launderers.

"Currently we are arresting hundi traders. However, there is a quarter which launders money through these traders. This issue was not focused on during the previous drives, but this time we will emphasise it," said a CID official on condition of anonymity.

He said the hundi syndicate has no direct link with the money launderers or those who smuggle money, "so we did not find much information regarding them from the 16 persons we have arrested. We have to dig deeper to identify them."