How global financial havens are stalling Bangladesh's stolen asset recovery drive

Highlights:

• Bangladesh's MLAR efforts stalled as major countries suggest alternative channels
• Only Malaysia, Hong Kong, UAE cooperating; key nations delaying responses
• Alternative approaches involve intelligence-sharing groups like APG, Egmont Group
• TIB says delays benefit recipient countries and expose Bangladesh's capacity gaps
• $234 billion illicitly moved abroad during 15 years of AL rule
• Government prioritising 11 major cases; recovering laundered assets remains difficult

Bangladesh's attempts to recover billions of dollars siphoned abroad over the past 15 years have made little headway, with several major recipient countries offering limited cooperation—and in some cases advising Dhaka to pursue "alternative approaches" rather than formal legal assistance.

According to minutes from a 17 November meeting of the inter-agency working committee on anti-money laundering—chaired by Financial Institutions Division Secretary Nazma Mobarek and seen by The Business Standard — Bangladesh has so far sent 19 Mutual Legal Assistance Requests (MLARs) to the US, UK, UAE, Malaysia, Singapore, Switzerland and several other jurisdictions.

The minutes show that some of the countries believed to have received the largest illicit inflows advised Bangladesh to use international platforms that track illicit financial flows, rather than rely solely on MLARs. The working committee has identified 10 key destinations where most Bangladeshi funds were allegedly laundered: Canada, the US, UK, UAE, Singapore, Malaysia, Australia, Switzerland, Thailand and Hong Kong.

So far, Malaysia, Hong Kong and the UAE have agreed to proceed with MLARs. The US, UK and Switzerland, however, have suggested alternative channels, while feedback from Canada, Australia, Singapore and Thailand is still pending. Foreign ministry officials said these four countries are likely to echo the stance of the US, UK and Switzerland.

Bangladesh's missions abroad and the foreign ministry are in ongoing communication with the destination countries to speed up responses.

At the meeting, a home ministry representative reported that an MLAR agreement with Malaysia is close to finalisation, pending amendments proposed by the interim government's Advisory Council. The draft agreement with Hong Kong has also been completed and is awaiting vetting by the law ministry before being cleared by the Advisory Council.

Infograph: TBS

What the 'alternative approach' means

A senior official of the Bangladesh Financial Intelligence Unit (BFIU) said countries recommending the "alternative approach" are pointing to platforms such as the Asia Pacific Group on Money Laundering (APG) and the Egmont Group, which facilitate intelligence-sharing on illicit financial flows.

"They are also suggesting that Bangladesh seek whatever support is possible within their domestic legal frameworks," the official said.

A senior Financial Institutions Division official added that Bangladesh's task force on money laundering, terror financing and asset recovery—which already coordinates inter-agency efforts—will ultimately decide whether to adopt these alternative routes.

'Laundered funds benefit them'

Transparency International Bangladesh (TIB) Executive Director Iftekharuzzaman, on 26 November, told TBS that some countries' advice to pursue an "alternative approach" may indicate wilful delay or avoidance, partly due to Bangladesh's failure to provide sufficient information and partly because they benefit from laundered funds.

He also noted that repatriating stolen money is highly complex, as the funds are often "legalised" abroad. Progress depends on Bangladesh's technical, legal, and forensic capacity.

$234b illicitly transferred abroad over 15 years

After the fall of the previous Awami League government in August 2024, the interim government set up a White Paper Committee, led by economist Debapriya Bhattacharya, to review the state of Bangladesh's economy. The committee reported that during AL's 15 years of rule, $234 billion was illicitly moved out of the country through 28 channels of corruption, averaging nearly $16 billion per year.

According to media reports, the UK emerged as the top destination for these laundered funds, with substantial investments flowing into London's financial sector and real estate market. Former land minister Saifuzzaman Chowdhury reportedly owns more than 300 properties in the UK, and the UK's National Crime Agency (NCA) has reportedly seized many of these properties.

The name of S Alam Group owner Saiful Alam also surfaced in connection with large-scale bank fraud, with the interim government estimating that the group moved nearly $10 billion–or possibly more–out of Bangladesh. The group denied the allegations, claiming them to be "completely false."

In August this year, the National Board of Revenue (NBR) revealed it had identified roughly Tk40,000 crore in assets abroad allegedly bought with laundered Bangladeshi money. Investigations by the NBR's Central Intelligence Cell (CIC) across seven cities in five countries between January and August traced these assets. Additionally, 352 passports allegedly obtained by some Bangladeshis for money were found across nine countries.

The Panama Papers, published by the International Consortium of Investigative Journalists (ICIJ), further indicated that Bangladeshis hold accounts in Swiss banks, underscoring the scale of illicit fund transfers from the country.

Govt prioritises 11 cases to recover smuggled funds

According to minutes of the 17 November meeting, 11 cases related to the recovery of laundered money are being given top priority. For these cases, the Anti-Corruption Commission (ACC) has filed 73 cases, while the CID has filed 17. So far, the ACC has submitted charge sheets in 9 cases, and the CID in all 17. Over 600 individuals have provided testimony in connection with these investigations.

During the meeting, a BFIU representative said that following the task force's decision on recovering laundered funds, a joint investigation team (JIT) comprising the ACC, NBR, and CID has been formed to probe allegations against the former chairman of the Premier Bank, HBM Iqbal, his family, and associated entities. However, the task force removed the Gemcon Group case from the priority list and added the HBM Iqbal case to the 11 top-priority cases.

On 24 November, ACC Chairman Mohammad Abdul Momen told reporters that repatriating smuggled money is highly challenging and complex. "Bringing back laundered money is very challenging. The ACC, Bangladesh Bank, and other relevant agencies are working together, but progress in recovering the smuggled funds is still not satisfactory," he added.

Meanwhile, the working committee on preventing money laundering and terrorist financing is preparing ahead of the fourth round of Mutual Evaluation by the Asia Pacific Group on Money Laundering (APG). APG will conduct Bangladesh's fourth evaluation in 2027-28.

This assessment reviews Bangladesh's national money laundering risks as well as the risks related to terrorism and terrorist financing. To reduce these risks, an eight-member committee has already been formed, headed by the additional secretary (Political) of the home ministry. The committee includes representatives from the Counter Terrorism Unit, Police Special Branch, RAB, NSI, DGFI, Anti-Terrorism Unit, and the BFIU.