Kazi Zahidul Hasan :
The Office of the Comptroller and Auditor General (OCAG) has detected a number of loan irregularities in 17 branches of BASIC Bank, involving Tk 5,400 crore, officials said.
Based on the findings of the audit, the OCAG has prepared a report and submitted it to the Ministry of Finance, recommending lawful action.
In the report, the former Managing Director (MD) Kazi Faqurul Islam and members of the board of directors of the bank have been held responsible.
Earlier, Bangladesh Bank (BB) removed Kazi Faqurul Islam from the post of MD of BASIC Bank Limited on the charges of negligence and irregularities apart from the failure to protect the depositors’ interests.
The Commercial Audit Department of the OCAG had conducted the audit from 2010 to 2013 bringing all the accounts of the 17 bank branches under the purview of the special inspection.
The report said that the loan irregularities happened due to utter negligence of the former MD of the bank. All the financial and business indicators of the bank declined sharply during the tenure of the MD.
The Audit has found gross irregularities in both loan sanctioning and disbursement process during the period. The Bank had to incur Tk 841 crore operating loss in the year 2013 but the then authorities concealed the fact showing it as Tk 53 crore by accounting jugglery, said the report.When asked, a member of the current board of directors told The New Nation yesterday that they would take the report in their cognizance and action would be taken against the corrupt officials of the bank.
Effective steps would also be taken against the culprits who embezzled money from the bank, forging documents and opening fake companies.
According to the audit report, Tk 4,830 crore loan irregularities were committed in four branches of Dhaka and one in Chittagong. And rest of the loan irregularities amounting to Tk 600 crore took place in others 12 branches of the bank. The Gulshan Branch of BASIC Bank tops the list of most corrupt branches where a total of Tk 2,247 crore loan was disbursed violating all the banking rules, followed by Santinagar Branch involving Tk 1,402 crore, Dilkhusa Branch Tk 758 crore, Kawran Bazar Branch Tk 153 crore and Agrabad Branch of Chittagong Tk 270 crore.
Earlier, a BB investigation found massive loan scams involving around Tk 4,500 crore in its three branches during 2009-2013.
The investigation of the central bank (BB) also found that former BASIC Bank Chairman Abdul Hye Bacchu and Managing Director illegally influenced all activities of the state-owned bank, making it ‘pauper’.
The BB investigation found several incidents of loan scams in four branches of the state-owned bank, namely Motijheel, Shantinagar, Dilkusha and Gulshan, involving nearly Tk 4,425 crore between December 2009 and November 2012.
The amount of loans was availed mostly by fake or nonexistence companies.
Of the amount, the Gulshan branch sanctioned nearly Tk 1,600 crore loan and the Shantinagar branch Tk 1,500 crore to more than 16 fake companies without proper scrutiny.
The board of directors approved the loans promptly to the clients of the nonexistence companies soon after they had opened accounts. Moreover, the bank’s board sanctioned loans before the branch sent the proposal to the bank headquarters.
According to BB investigation report, the Gulshan branch sanctioned the loan to six fake companies which are S Suhi Shipping Line, S Recourse Shipping Line, Shifan Shipping Line, Amira Shipping Line, SFG Shipping Line, and Green Bangla Shipping Line.
The bank’s Shantinagar branch sanctioned loans to 10 business entities and individuals, without proper documentation and collateral. The names of the companies and individuals are: Nahar Garden, Auto Define, Syed Traders, Ahmed Faizur Rahman, LR Trading, Fiez Auto, Eco Brick, Noman Textile and Aristocrat.
The BB inspection report also showed that Basic Bank issued loans of Tk 45 crore to AB Trade Link and another Tk 112 crore to Ma Tex, EFS Enterprise and SPN Enterprise from its Dilkhusha branch and all the four companies were fake.
The central bank found clear involvement of the board of directors in the loan scam of AB Trade Link. The board approved the loan on September 6, six days before the bank’s branch concerned sent AB Trade Link’s proposal to the head office on September 12, 2011.
On July 6 this year, the government dissolved the seven-member board of BASIC Bank over its role in financial irregularities and later reconstituted the board appointing Alauddin A Majid as the new chairman of BASIC Bank.
BASIC Bank was one of the best performing financial institutions till 2009. But it has been mired in financial irregularities since the previous board assumed office in 2009.
