Tracing billions: Govt for speedy settlement with kleptocrats before election

Infograph: TBS

The interim government is preparing to pursue kleptocrats through settlements to recover stolen assets within the next six months, avoiding drawn-out legal battles that could last four to five years.

According to sources, several individuals have already expressed interest in negotiating settlements rather than facing legal proceedings, fearing international sanctions and asset freezes. The Asset Recovery Taskforce, which has begun engaging the UK government to impose sanctions on key figures, is leading this effort.

The task force, spearheaded by Bangladesh Bank Governor Ahsan H Mansur, will outline the settlement framework in an upcoming meeting with Chief Adviser Muhammad Yunus on 16 April, insiders confirmed to The Business Standard.

Currently, Bangladesh lacks a legal framework for settlement agreements. As a result, provisions for structured settlements may be incorporated into the new Asset Recovery Act, which is being drafted to align with the election timeline and accelerate the process.

A special committee comprising senior decision-makers is expected to be formed to ensure transparency in the settlement process, a task force member disclosed, preferring to remain anonymous.

Historically, asset recovery efforts can take several years, with many countries failing altogether. However, Kazakhstan has successfully reclaimed $2.2 billion through settlements, the member added.

In a strategic shift, the task force has expanded its focus from the previously decided 11 corruption cases to 100 high-value cases, each involving financial misconduct exceeding Tk200 crore. These cases will be presented to litigation funders, broadening the portfolio to include banking and political corruption, involving MPs, bureaucrats, generals, and law enforcement officials.

The decision followed extensive discussions between the Governor and key public and private sector stakeholders during his visit to London on 17-21 March, arranged by Ifty Islam, who serves as the global coordinator and adviser to the Governor.

During the visit, Mansur held individual meetings with three of the world's largest litigation funders, including Omni Bridgeway, which expressed interest in Bangladesh's cases. However, insiders revealed that Omni Bridgeway requires six to 12 months to conduct due diligence and assess evidence before committing to an investment.

Given the time constraints amid the political climate and upcoming election, Bangladesh needs to fast-track evidence collection to match international standards. The most feasible approach, according to litigation funders, is to provide globally recognised forensic evidence within six to eight weeks, ensuring quicker investment decisions.

However, Bangladesh has struggled to develop internationally admissible evidence over the past eight months due to limited expertise and capacity. In response, the Governor has resolved to generate multiple cases through litigation funding, alongside engaging forensic investigators to accelerate evidence-gathering efforts by May.

To strengthen international evidence capabilities, the task force is seeking expert collaboration with organisations such as the International Anti-Corruption Coordination Centre (IACCC), the UK's National Crime Agency, and the FBI. Government-to-government cooperation, alongside private sector partnerships, is also being explored to secure skilled investigators within a month.

Against this backdrop, Bangladesh Bank is set to host the first Chief Anti-Money Laundering Compliance Officers (CAMLCO) Conference – 2025 in Chittagong under the interim government on Friday. The conference is themed "Crisis to Resilience: Reinforcing Bangladesh's AML/CFT Framework to Combat Corporate Abuse and Illicit Financial Flows."

Challenges in asset recovery

Despite the formation of the Asset Recovery Taskforce eight months ago, Bangladesh has yet to present a single case with internationally recognised evidence to the IACCC, which has visited the country four times to provide technical assistance.

The task force, consisting of 11 agencies and joint investigation teams, has failed to trace international assets, largely due to lack of coordination and expertise in building cases to global standards.

Governor Mansur expressed frustration over the delays, stating, "While we've stabilised the banking sector, asset recovery remains a failure due to the reluctance of authorities to build cases and cooperate."

He further emphasised Bangladesh's lack of domestic investigative expertise, which hinders efforts to secure international-standard evidence.

The task force comprises 11 key agencies, including the ACC, police, CID, multiple NBR agencies, BFIU, the Attorney General's office, the Law Ministry, the Finance Ministry, the Financial Institutions Division, the Foreign Ministry, and the Home Ministry.

Although progress has been slower than expected, sources close to the task force remain optimistic about accelerated breakthroughs in the next six months, predicting momentum in international asset recovery.

International cooperation: Which countries are engaging?

• A task force insider shared insights on responses from various countries:
• The UK and Singapore have demonstrated strong interest in supporting Bangladesh's asset recovery.
• The UAE remains challenging, as its economy relies significantly on laundered money.
• Bangladesh is close to securing an agreement with the UK to impose sanctions on kleptocrats.
• Discussions are underway to create a Special Purpose Vehicle in Singapore and London to transfer legal claims.
• The task force is considering establishing a Sovereign Wealth Fund in Dubai or Singapore, offering incentives for UAE authorities to cooperate with recovery efforts.
• The Chief Adviser plans to visit the UAE to formalise the proposal.

"We are exploring different legal structures to ensure the asset recovery process remains insulated from political reversals," said the insider, stressing the importance of political diplomacy in negotiations with the UK and Singapore.