Frame ownership transparency law for private banks, urges TIB
The civil society organisation fighting against corruption also criticises the government for recent loan scams
Transparency International Bangladesh on Monday urged the government to frame a beneficial ownership transparency law and join the Common Reporting Standard to save the country's ailing banking sector.
Transparency about beneficial ownership is aimed at preventing companies' owners from operating in secrecy, according to the World Bank.
The Common Reporting Standard, developed in response to the G20 request and approved by the Organisation for Economic Co-operation and Development Council, sets out the financial account information to be exchanged, the financial institutions required to report, the different types of accounts and taxpayers covered, as well as common due diligence procedures to be followed by financial institutions.
Keep updated, follow The Business Standard's Google news channel
In a press release, the Berlin-based multinational civil society organisation fighting against corruption also expressed its concern over the recent alleged loan scams in three private banks, including Islami Bank Bangladesh.
The surprising irregularities involving thousands of crore taka coupled with money laundering have pushed the country's banking sector to the brink of collapse, it added.
"The news of taking out thousands of crores of take from several banks in the name of loans are very alarming for the economy of the country," TIB Executive Director Iftekharuzzaman stated in the release.
"A small customer has to provide a lot of documents to get a small loan, then how do fake companies get such big loans? The total amount of defaulted loans has risen six folds in the past 14 years. Even, the loans cannot be recovered for frequent changes in the definition of defaulted loans and rescheduling. Who benefits from the loan scams? Citizens have the right to know," he added.
"After the much-talked-about BASIC Bank scam and PK Haldar fraud in the recent past, why did we not learn a lesson?"
On money laundering, the TIB chief said the government has failed to prevent the irregularity. "Moreover, it has suspended sending relevant data to the United Nations organisations with the intention to hide the data."
"In addition to probing the latest loan scam cases, appropriate measures should be taken immediately so that these funds cannot be smuggled abroad in any way. Joining the Common Reporting Standard is a must. At the same time, a law on beneficial ownership transparency should be enacted for the private sector banks immediately," Iftekharuzzaman said.
