An attempt of laundering $870 million, in addition to already stolen $100m from Bangladesh Bank, was foiled in February thanks to international banks' recalling of an order to transfer the amount to local banks in the Philippines.
Just a few days ago $81m had been suspected to have been stolen from the central bank of Bangladesh and managed to enter the Philippine banks. The amount was already released to the local clients of Rizal Commercial Banking Corp (RCBC), revealed a report by Philippine daily the Inquirer yesterday.
Soon after the RCBC released the funds to its client, the bank received a so-called “MT103” message through the Swift system from international banks recalling the $81m and ordering to stop the release of another $870 million – roughly one-third of the cost of constructing the Padma Bridge – in inward transfers.
The Inquirer quoted a banking source as saying that the transfer of the $870 million was stopped in time, but $81m had already been released and, by the time authorities were alerted, had already been moved back offshore.
Bangladesh Bank claims that it has already brought back an amount of $20m that was stolen from its reserve account and laundered to Sri Lanka.
“We have brought back a portion [of the stolem money] from Sri Lanka with the help of the Sri Lankan central bank,” Bangladesh Bank Executive Director Subhankar Saha told journalists in Dhaka yesterday after a meeting with the scheduled banks on cyber security.
He expects that the amount of $81m transferred to the Philippines will be recovered soon with the help of the anti-money laundering authorities there. He declined to disclose anything further for the sake of investigation.
“We still suspect that the account was hacked from outside the country,” Rakesh Asthana, former IT specialist of World Bank, told reporters after the meeting. “But it cannot be said whether there was any link of Bangladesh Bank’s internal system with the hacking.”
Two officials of the Bangladesh Bank were also reported to have visited the Bangko Sentral ng Pilipinas to demand the return of the funds that were allegedly stolen by hackers based in China from its accounts with the Federal Reserve Bank of New York.
Various sources told the Inquirer that the money were channelled to a foreign exchange dealer and then transferred to casinos – Solaire Resort and Casino, City of Dreams and Midas – where they were converted into chips for betting at gaming tables, then converted back into cash and remitted to accounts in Hong Kong soon after.
According to the documents seen by the Inquirer, the $81 million in inward remittance happened on February 5. As with all international wire transfers, the funds were cleared through US-based correspondent banks, in this case, the Bank of New York, Citibank and Wells Fargo.
The local counterpart was then notified of the incoming funds using the Swift (Society for Worldwide Interbank Financial Telecommunication) messaging system commonly used by banks for international transactions.
The funds were deposited into the five bank accounts created a few months earlier and were transferred to foreign exchange broker Philrem for conversion into pesos. It was then transferred back to RCBC and consolidated into the bank account of a Chinese-Filipino businessman, who then moved it to the casinos.
Another government source told the Inquirer that the Chinese-Filipino businessman also took care of remitting the funds to Hong Kong after these were moved through local casinos.
Besides the Senate, the National Bureau of Investigation and state-owned Philippine Amusement and Gaming Corp (Pagcor) are conducting their own investigation of the money laundering incident. Pagcor operates its own casinos and licenses a few private firms to run their own casinos.