Gulam Rabbani :
Agrani Bank Limited, a state owned leading commercial bank, has withdrawn itself from a contract signed with Flora Telecom, a local core banking software services providing company, after it had found primary evidence of irregularities in activities of the company.
But no legal action has been taken yet against the
information and communications technology (ICT) solution company.
Meanwhile, the High Court has directed the Ministry of Finance, Bangladesh Bank and Agrani Bank to submit an investigation report on the irregularities within the next two months.
Core Banking Software (CBS) is typically used to run the banking activities which provides quick banking services to clients and also protect banks from cyber threats.
Corruption and irregularities are the common scenario in the state-owned banks. After a series of loan scams and money laundering news, the information of corruption in the digital services of Agrani Bank Limited came to the light this time.
There have been allegations of various irregularities, including fake work-order, substandard services and extra costs against the Flora Telecom.
The bank recently announced the cancellation of all contracts with the domestic core banking software services providing company after the complaints had come into the front one after another.
Flora Telecom, a service provider under Temenos, a Switzerland based banking software services company, was dropped after the allegations of corruption had surfaced. However, Agrani Bank is still receiving service from the Temenos.
Meanwhile, two clients of the Agrani Bank recently filed a writ petition with the High Court to take appropriate action against corruption and money laundering in digital banking services of the bank.
Upon hearing the petition, the High Court bench of Justice Md Mozibur Rahman Miah and Justice Mohi Uddin Shamim asked the Ministry of Finance, Bangladesh Bank and Agrani Bank to submit an investigation report on the irregularities within the next two months.
Mohammad Shams-Ul Islam, Managing Director & CEO of the bank, said that they would take further step following the court order.
Sources said, the bank had initially purchased Temenos T24 CBS’s in 2008. In 2018, the license was renewed again at a cost of over US$12 million for 10 years till 2028. Flora Telecom Limited was tasked for implementation, monitoring and upgrading of the software.
It is alleged that the Flora Telecom Limited (FTL) implemented the project without properly upgrading the software and also didn’t maintain it properly. In doing so, the firm had meanwhile forged the signature of a Deputy General Manager of the bank to claim the right to handle the next phase of upgrading.
FTL then informed the Agrani Bank that its software system need to be upgraded with the latest version of T24 CBS for another $46 million to purchase additional modules and other equipment. The proposal was made in August 2019, only 9 months after the renewal was made.
In January 2020, the bank management proposed to the board for sanctioning US$37 million for the purpose, and its Managing Director Mohammad Shams-ul Islam and the then IT General Manager strongly supported the move.
The board however, did not approve the proposal as new CITO, Muhammad Mahmud Hasan, immediately raised concerns over the costly proposal. Hasan felt that many modules were not required, but Singapore based supplier of FTL kept on insisting that all these modules were mandatory for an upgradation package.
Checking with other local banks, however, showed FTL proposed price for software is at least three times higher than other banks using the same.
It is alleged that FTL neither informed Temenos about the development nor paid the commission against business done with Agrani Bank.
It is alleged that Temenos senior management did not receive the funds, and found that FTL had forged documents. The supplier has a new proposal this time at a cost of US$ 15 million.
Agrani Bank Limited, a state owned leading commercial bank, has withdrawn itself from a contract signed with Flora Telecom, a local core banking software services providing company, after it had found primary evidence of irregularities in activities of the company.
But no legal action has been taken yet against the
information and communications technology (ICT) solution company.
Meanwhile, the High Court has directed the Ministry of Finance, Bangladesh Bank and Agrani Bank to submit an investigation report on the irregularities within the next two months.
Core Banking Software (CBS) is typically used to run the banking activities which provides quick banking services to clients and also protect banks from cyber threats.
Corruption and irregularities are the common scenario in the state-owned banks. After a series of loan scams and money laundering news, the information of corruption in the digital services of Agrani Bank Limited came to the light this time.
There have been allegations of various irregularities, including fake work-order, substandard services and extra costs against the Flora Telecom.
The bank recently announced the cancellation of all contracts with the domestic core banking software services providing company after the complaints had come into the front one after another.
Flora Telecom, a service provider under Temenos, a Switzerland based banking software services company, was dropped after the allegations of corruption had surfaced. However, Agrani Bank is still receiving service from the Temenos.
Meanwhile, two clients of the Agrani Bank recently filed a writ petition with the High Court to take appropriate action against corruption and money laundering in digital banking services of the bank.
Upon hearing the petition, the High Court bench of Justice Md Mozibur Rahman Miah and Justice Mohi Uddin Shamim asked the Ministry of Finance, Bangladesh Bank and Agrani Bank to submit an investigation report on the irregularities within the next two months.
Mohammad Shams-Ul Islam, Managing Director & CEO of the bank, said that they would take further step following the court order.
Sources said, the bank had initially purchased Temenos T24 CBS’s in 2008. In 2018, the license was renewed again at a cost of over US$12 million for 10 years till 2028. Flora Telecom Limited was tasked for implementation, monitoring and upgrading of the software.
It is alleged that the Flora Telecom Limited (FTL) implemented the project without properly upgrading the software and also didn’t maintain it properly. In doing so, the firm had meanwhile forged the signature of a Deputy General Manager of the bank to claim the right to handle the next phase of upgrading.
FTL then informed the Agrani Bank that its software system need to be upgraded with the latest version of T24 CBS for another $46 million to purchase additional modules and other equipment. The proposal was made in August 2019, only 9 months after the renewal was made.
In January 2020, the bank management proposed to the board for sanctioning US$37 million for the purpose, and its Managing Director Mohammad Shams-ul Islam and the then IT General Manager strongly supported the move.
The board however, did not approve the proposal as new CITO, Muhammad Mahmud Hasan, immediately raised concerns over the costly proposal. Hasan felt that many modules were not required, but Singapore based supplier of FTL kept on insisting that all these modules were mandatory for an upgradation package.
Checking with other local banks, however, showed FTL proposed price for software is at least three times higher than other banks using the same.
It is alleged that FTL neither informed Temenos about the development nor paid the commission against business done with Agrani Bank.
It is alleged that Temenos senior management did not receive the funds, and found that FTL had forged documents. The supplier has a new proposal this time at a cost of US$ 15 million.
