Lawsuit against NY Federal Reserve likely soon

“We will discuss the issue further once Law Minister Anisul Huq, who is now in the Philippines, returns,” Finance Minister AMA Muhith said after a meeting of the cabinet committee on economic affairs at the Secretariat yesterday. He made the remark in reaction to news that Rizal Commercial Banking Corp (RCBC) of the Philippines refused to pay back the money stolen by hackers in February. Muhith pointed out that although the Federal Reserve Bank of New York gave authorisation of transaction of money with doubt, later it transferred the reserve money to the RCBC. Muhith said he was surprised by the RCBC’s latest stand. He said: “I do not understand what has happened to Rizal Commercial Banking Corp. Two days ago I wanted to thank the Rizal Commercial Bank authority for returning the Bangladesh Bank’s stolen money.” Muhith said the RCBC is now blaming the Bangladesh Bank for being negligent. The Philippine bank termed the NY Federal Reserve Bank’s transaction unauthorised and based on that it is saying it would not give back Bangladesh Bank its stolen money, Muhith observed. The minister said: “I am not giving any detailed explanation on the matter until the law minister returns and I will have a talk with our ambassador in the Philippines. “I want to know the stand of the Philippines government on the matter.” Muhith said: “I still believe continued diplomatic negotiation can ensure the return of the stolen money.” On disclosure of the report of Farashuddin on the BB heist the finance minister said he would make it public at the right time. The actions so far taken by the Bangladesh Bank will not work once the report is published, he said. Muhith said he thinks the return of the heist money will be delayed after the case is filed against the NY Federal Reserve Bank. The RCBC in the Philippines recently said it is not liable to compensate Bangladesh for the bank heist money deposited in its accounts and instead blamed Bangladesh Bank for being negligent. The RCBC said it would not compensate Bangladesh because the initial security breach was Bangladesh’s own fault. A high-level delegation from Bangladesh, including Law Minister Anisul Huq and Bangladesh Bank Governor Fazle Kabir, is now in Manila to speed up recovery of the stolen money. Unknown cyber criminals tried to steal nearly $1bn from Bangladesh Bank in February, one of the biggest bank frauds ever. They succeeded in transferring some $81m via an account at the New York Federal Reserve to four accounts in fake names at a branch of the RCBC in Manila. Most of the money was laundered through casinos in Manila and remains missing.