The Anti-Corruption Commission (ACC) has launched a probe into Farmers Bank’s large-scale fraud allegations involving Tk 400 crore.
The anti-graft watchdog has formed a three-member investigation team led by its Director Syed Iqbal Hossain, officials said.
They said the ACC investigators have already obtained the documents relating to processing and sanctioning of loans provided by the bank to various business firms and persons breaching credit norms.
“We’re examining the documents to set the next course of action,” an ACC official told The New Nation on Thursday, on condition of anonymity.
He said the ACC investigators have found various irregularities in sanctioning loans to a number of business firms and persons. “The bank’s board extended lending facility to them without proper documentation conducting pre and post sanction inspections and without ascertaining the end use of the loan,” he added.
The official said the head of the probe team is now out of the country. ACC will go for action against the perpetrators of the loan scandal after he returns home.
“The ACC team will unearth the beneficiaries of the loan fraud after verifying the antecedents. None will be spared if found guilty,” he said.
When asked, he said, the ACC probe team is looking into whether the board members, including the bank’s former chairman Dr Mohiuddin Khan Alamgir, were also involved in the scam. “The ACC will not bow down to any political pressure or influence from any quarter while carrying out the investigation,” he said.
“Travel ban has already imposed against a number of the bank’s former board members so that they cannot flee abroad to escape the ACC prosecution team. We will summon them after getting green signal from the ACC high-ups. They will face quizzing over the alleged loan scandal,” he added.
The Farmers Bank began operations in June 2013 with Tk 400 crore capital. However, irregularities resurfaced within a year.
The bank had allegedly recruited manpower before receiving its license from the Central Bank.
Between September and November 2015, the Bangladesh Bank (BB) conducted special inspections at three Dhaka branches (Gulshan, Motijheel and Shyampur) of the bank and found gross violations of banking rules in disbursing loans worth around Tk 400 crore.
The BB found some directors, including chairman Dr Mohiuddin Khan Alamgir and Mahabubul Haque Chisty, of the bank allegedly involved in sanctioning these loans, violating the credit rules.
Chisty, a powerful director and also chairman of the bank’s executive committee, got involved in loan scams worth Tk 50 crore within one year of the bank’s operation.
When BB detected the anomalies, it asked the Farmers Bank in May 2015 to remove Chisty from the committee.
Challenging the BB decision, the bank went to court on January 11, 2016. After two days, the Central Bank appointed an observer in the bank to scrutinise operations of the bank and slapped a fine of Tk 10 lakh on charges of illegal payments and loan irregularities.
Irked by the BB’s move, Mohiuddin, a ruling party lawmaker and chairman of a parliamentary committee on public accounts, summoned a scrutiny report conducted on the functioning of the Central Bank.
The parliamentary committee raised questions on the functions of the Central Bank.
Mohiuddin flexed his muscles asking the audit office to submit a special report on BB.
Later, Chisty replied to the show-cause notice issued by BB on March 26, 2016 confessing that he was responsible for the anomalies. But he said he violated the rules and regulations inadvertently in disbursing the loans.
He then resigned from his post in the executive committee, citing personal reasons. Then Mohiuddin, the bank’s chairman, made Chisty chairman of the bank’s audit committee, another vital committee that supervised the bank’s activities.
Finally, Mohiuddin and Chisty succumbed to Central Bank’s pressure and tendered their resignation on November 26 last year.
On December 19, the BB also removed Farmers Bank’s Managing Director AKM Shameem for his failure to manage the bank efficiently and address its liquidity crunch.
