Bangladesh Central Bank Plans Philippine Legal Action Over Stolen Money

Kamran Reza Chowdhury
160729-BD-bank-620.jpg The logo of RCBC bank appears atop the RCBC building in Manila’s financial district, March 11, 2016.

Bangladesh Central Bank officials say they plan to file a legal case in the Philippines to get back about U.S. $15 million in recovered money from the $81 million stolen by computer hackers nearly six months ago.

Philippine authorities recovered $15.25 million in installments a few months ago. They have been cooperating with Bangladeshi government representatives to find the remaining nearly $66 million in stolen Bangladesh Bank money, which also wound up in the Philippines and is believed to have been laundered there, central bank officials said.

The $81 million was stolen during an electronic transfer from an account held by the Bangladeshi bank at the Federal Reserve Bank of New York. The theft was a record heist for Bangladesh, but before it can recover the $15 million, Bangladesh Bank must file a legal claim of ownership of the money in a Philippine court, according to a senior official.

“Now, we have to file a case with a Philippine trial court for the recovery of the stolen money. Without the court’s permission, the Anti-Money Laundering Council (AMLC) of the Philippines cannot return our money,” Debaprosad Debnath, a Bangladesh Bank general manager in charge of the Bangladesh Financial Intelligence Unit (BFIU), told BenarNews.

“Some of our central bank officials will fly to the Philippines soon,” he added.

The $15.25 million was handed over to the Philippine anti-money laundering agency by Kim Wong, a Filipino junket casino operator.

Bangladesh also is trying to find out what happened with the rest of the money that was wired by the New York Fed to the Rizal Commercial Banking Corp. (RCBC), a bank based in Manila, on Feb. 4, according to reports.

In May, Bangladesh’s ambassador to the Philippines, John Gomes, told a Filipino senate inquiry that “the whole world knows the money belongs to Bangladesh.”

“Eighty-one million dollars came over here. Not a single dollar went anywhere else,” Gomes told a panel of senators.

Debnath said Bangladeshi investigators were trying to trace where the remaining $65.75 million went.

“So, we will have to wait for some time to get back the remainder,” Debnath said.

Manila bank ‘chiefly responsible’

According to a former governor of the central bank who is heading a Bangladeshi government probe into the heist, the RCBC bank in Manila was at fault and could soon be the target of a Bangladeshi lawsuit.

“In our investigation, we have found that the RCBC is chiefly responsible for the disbursement of the money [$81 million]. The Bangladesh Bank sent messages to the RCBC informing [it] that the payment orders were fake, but the bank went ahead with the payments,” Mohammed Farashuddin told BenarNews.

“The RCBC must shoulder the responsibility of the whole $81 million,” he added.

Farashuddin said the Philippine Senate had been supporting Bangladesh in its efforts to recover all of the money, but this could take “some time.”

For its part, RCBC said in a statement that it supported the Bangladesh Bank’s efforts to recover the money from “the parties who ultimately received them,” according to Reuters.

In Bangladesh, no arrests have been made in connection with the case. But in March, Farashuddin told BenarNews that the heist could not have happened “without the collusion of Bangladesh Bank officials” because SWIFT codes needed to execute such a transfer were confidential and only known in-house.

Meanwhile, the New York Fed has urged the Philippine Central Bank to help Bangladesh’s central bank recover the stolen $81 million in full, Reuters reported on Friday, citing a letter sent from the Fed’s general counsel to his Philippine counterpart in late June.

According to the letter obtained by Reuters, payment instructions for four monetary transfers to beneficiary accounts at RCBC were authenticated using a “commercially reasonable security procedure,” but that these were “issued by persons using stolen credentials,” the news agency reported.

Officials at the Philippine embassy in Dhaka could not be reached for comment on Friday.


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