Is it really possible to send Tk400cr abroad as tuition fees?

The revelation by Chief Adviser's Press Secretary Shafiqul Alam on Monday that an individual has sent Tk400 crore abroad as tuition fees for his son has left many in shock, raising serious concerns about regulatory oversight on outbound remittances.

Shafiqul cited preliminary findings from the National Board of Revenue (NBR) and noted that an investigation was ongoing.

A month ago, the NBR sent letters to all commercial banks, seeking details of student files opened since the fiscal 2017-18. 

NBR sources told TBS that the Tk400 crore was not sent abroad by a single individual but by multiple people. Nevertheless, it is still a huge amount, and the question remains: How did they manage to transfer such a large sum abroad while slipping past the central bank's watch?

Speaking to TBS, a senior executive of a leading private commercial bank, which manages the highest number of student accounts, expressed scepticism about the claim, terming the Tk400 crore figure "abnormal".

Banks must follow strict policies when handling outward remittances for students, he said.

"Outward remittances for education pass through multiple verification layers at banks. Additionally, banks must report student file openings to the Bangladesh Bank, which conducts monthly reviews. If any unusual transaction is detected, the central bank calls the respective bank for clarification," he said.

Banks do not require prior approval to open regular student files, but in exceptional cases – such as diploma courses, school-level training, or online programmes – they must seek approval from the Bangladesh Bank, he continued.

Typically, annual tuition fees for universities abroad range between $20,000 and $30,000, with living costs at a similar level, bringing the total annual expenses to around $60,000. In Bangladeshi currency, that amounts to a maximum of Tk1.5 crore to Tk2 crore per student per year.

Since banks report to the Bangladesh Bank only after processing outward remittances, the central bank cannot preemptively block transactions. However, banks verify tuition and living costs against university websites and offer letters before processing payments.

"There is no scope to send excessive amounts abroad, as multiple layers – including the Bangladesh Bank – monitor outward remittances," he said. "Moreover, funds are sent directly to university accounts, meaning any laundering attempt would require collusion from the educational institution itself."

He further pointed out that refund policies for student accounts are strict. If a student fails to secure a visa or cancels admission, the university must refund the amount.

However, a top executive of the Bangladesh Financial Intelligence Unit (BFIU) told TBS that sending large sums abroad is possible if proper due diligence is not followed.

Money laundering in this manner can only be facilitated by bank owners, similar to the credit card scam that took place at National Bank involving its owners, he said.

Citing the National Bank scam, he explained that the bank allowed 11 members of the Sikder family to spend Tk55 lakh of depositors' funds beyond their foreign currency quota on the instructions of the then-chairman Zainul Haque Sikder, who passed away in 2021. The bank had failed to report the relevant information to the Credit Information Bureau.

In the case of the outbound remittance of tuition fees, if the amount is not reported to the central bank, such transactions are possible – but only by influential figures within the bank, the BFIU official added.

According to banks, every year, around 1 lakh students go abroad for studies, and about 60% of them open student accounts in Bangladesh. This means that at least 60,000 student files are opened annually for studying abroad.

Md Abdur Rakib, commissioner of the Tax Intelligence and Investigation Unit of the NBR, told TBS, "We have collected information about 50,000 files from five banks so far. Our team is working to scrutinise these files.

"Not all of the files are our focus. We aim to work on files with large sums, which could be around 500 in number," he said.

When contacted, NBR Chairman Abdur Rahman Khan declined to provide further details about the Tk400 crore student file, saying, "We are working on it and will reveal more information once we reach a mature stage."