No scope for money launderers to return to bank boards: BB

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Dhaka, Apr 23 - Bangladesh Bank has clarified that any individual or group facing allegations of money laundering abroad will be barred from returning to the board of directors of any bank.

Arif Hossain Khan, Executive Director and Spokesperson of the central bank, gave this clarification on Thursday to address public confusion regarding certain provisions of a recent ordinance related to banking sector reforms.

The clarification follows concerns raised in the media and among the public about whether controversial figures previously accused of financial irregularities, loan scams, and money laundering could be rehabilitated into the banking sector.

“The information presented in some media outlets regarding the recent reform ordinance has sparked various questions,” said Arif Hossain Khan.

“There are fears that individuals or groups involved in past irregularities might find a way back into bank ownership or management,” he added.

Explaining the ordinance, the spokesperson noted that while former directors or sponsors could potentially regain ownership by paying a specific amount—7.5% of their dues—this is not an "automatic or indiscriminate" opportunity. Instead, the entire process will be subject to rigorous scrutiny and regulatory oversight.

He further detailed that for anyone seeking to return to a bank board, Bangladesh Bank will first gather data from various agencies regarding any outstanding allegations. Specifically, reports on money laundering or suspicious transactions will be sought from the Bangladesh Financial Intelligence Unit (BFIU).

“If there is a money laundering allegation against an individual, they must first be legally or institutionally cleared of those charges,” Khan emphasized.

The spokesperson added that mere clearance from charges is insufficient; the financial conduct of the individual or institution, particularly their history of borrowing and repayment, will also be examined. Those with significant defaulted loans must adjust or settle them according to regulations to be considered for rehabilitation.

“If the concerned parties can clear themselves through the standard legal process and settle all financial liabilities regarding past allegations—such as taking loans under various names, misappropriation, or laundering funds—then the regulator may not object to their participation,” he stated.

However, he stressed that there is no scope for special favors or leniency. Each application will be judged based on data analysis and recommendations from relevant agencies to ensure the banking sector is not put at risk again.

Financial analysts observe that while this stance signals a commitment to restoring discipline in the banking sector, the ultimate success depends on how strictly these policies are enforced to prevent the re-entry of controversial groups. - UNB