Islami Bank accuses ex-president Shahabuddin, S Alam, 36 others of around Tk500cr embezzlement

Highlights

• Former president Shahabuddin named among accused
• S Alam named as alleged loan beneficiary
• Complaint alleges forged documents and money laundering
• ACC says probe awaits commission's formation

Islami Bank Bangladesh PLC has filed a written complaint with the Anti-Corruption Commission (ACC) against former president Mohammed Shahabuddin, S Alam and 36 other individuals and entities over the alleged embezzlement of around Tk500 crore through loan fraud.

Mohammad Yasin Ali, first assistant vice-president of Islami Bank's Foreign Exchange Corporate Branch, recently submitted the complaint to the ACC.

The complaint alleges that the accused, acting in collusion, created forged documents through fraud and forgery to embezzle around Tk500 crore from the bank and launder the money abroad, leaving the bank in financial distress.

According to the complaint, Suprabh Composite Knit Ltd was originally a distressed small industrial enterprise with an investment limit of Tk100 crore.

With the assistance and influence of the accused, the limit was gradually increased to Tk200 crore and subsequently to Tk500 crore illegally.

The loans were approved without adequate collateral or guarantees and without proper verification and assessment.

Between 27 July 2017 and 5 December 2023, loan proposals were sent from the branch to the head office at different times.

The loans were approved at executive board meetings held between 20 June 2017 and 21 November 2023, it said.

Despite repeated reminders and final demand notices issued between 2019 and 2025 for repayment, the loans were not repaid.

Suprabh Composite Knit Ltd and its managing director Mohammad Yunus, also known as Alhaj Md Yunus Badal, have been named as the principal accused.

Galaxy Sweaters and Yarn Dyeing Ltd, ABM Shamsul Hasan, Saleha Shahin, Umme Salma Sharmin and several directors of the company are also among the accused.

The complaint also names S Alam Group Chairman and Managing Director Mohammad Saiful Alam (Masud), commonly known as S Alam, as an alleged beneficiary of the loan facility.

Several former Islami Bank directors, former executive committee members, former managing directors and CEOs, former deputy managing directors and bank officials have also been named.

The complaint seeks action against the accused under sections 406, 409, 420, 467, 468, 471, 477A, 34 and 109 of the Penal Code, sections 5(1)(2) of the Prevention of Corruption Act, 1947, and section 4 of the Money Laundering Prevention Act, 2012.

Mohammad Yasin Ali of Islami Bank's Foreign Exchange Corporate Branch told The Business Standard that the bank has filed several cases over irregularities involving S Alam's loans.

"Based on a court directive, we provided the ACC with information on the loan irregularities to supply information related to a case," he said.

ACC Secretary Md Saidur Rahman Khan said he had not received such a complaint since taking charge.

He also said the ACC could not act on such complaints until the commission is constituted.

"These allegations will be examined after the commission is constituted," he said.