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Bangladesh Bank: Reserve heist case to be settled in three years

  • Published at 06:15 pm February 3rd, 2019
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Officials of Bangladesh Bank and Bangladesh Financial Intelligence Unit address a press conference held at the central bank in Dhaka on Sunday, February 3, 2019 Dhaka Tribune

On behalf of Bangladesh, Cozen O' Connor, a US law firm, filed the case with the United States District Court for the Southern District of New York

Bangladesh Bank hopes the reserve heist case will be settled in three years and they will recover all of the money electronically stolen from its foreign reserve account at the Federal Reserve Bank of New York.

“We filed the lawsuit around 7am on February 1 (New York time 8pm on January 31) against seven institutions (including Philippines-based Rizal Commercial Banking Corp), 15 top executives (some from RCBC and others from a Filipino casino) and 25 unnamed individuals,” said Abu Hena Md Razee Hassan, chief of the Bangladesh Financial Intelligence Unit (BFIU). 

On behalf of Bangladesh, Cozen O' Connor, a US law firm, filed the case with the United States District Court for the Southern District of New York. The New York Fed signed an agreement to help the Bangladesh central bank resolve the case, he added. 

The BFIU chief disclosed the information at a press conference of the central bank on Sunday afternoon to brief the media on the case filed for the cyberheist that took place in February 2016.

Bangladesh Bank lawyer, Ajmalul Hossain QC, and BFIU Adviser Debaprasad Debnath, were also present at the briefing.

Replying to a question, Razee said around Tk3 crore has been spent so far in attempts to recover the stolen money.

Lawyer Ajmulul Hossain said the case filed with US courts will be resolved within three years. However, there may be changes to this time frame owing to various circumstances. 

He also said an agreement was signed with the Federal Reserve Bank of New York (Fed) in the United States. “They will give us different documents and information to the witnesses for the case. Additionally, SWIFT will provide all sorts of assistance.”

“In the 103-page complaint, seven institutions (including Philippines-based Rizal Commercial Banking Corp), 15 top executives, and 25 unidentified persons have been made defendants. Of the $101 million of stolen money, $35 million has been recovered (including $20 million returned from Sri Lanka).The defendants will be forced to return the cost of the case with interest,” he added. 

A team of senior central bank officials went to New York on January 27 to file the lawsuit with the US District Court for the Southern District of New York. This was the first press conference held after the team returned to Bangladesh. 

A Dhaka court set February 10 as the new deadline by which the probe report has to be submitted in the case filed for the cyberheist, after the investigating officer failed to submit it on January 9.

The deadline for submitting the probe report to the court has changed 28 times so far.

Ex-RCBC banker convicted

On January 10, a Philippine court found former RCBC branch manager, Maia Deguito, guilty on eight counts of money laundering, the first conviction in the heist case.

According to a Reuters report, the regional court sentenced Deguito to a jail term ranging from 32 to 56 years, with each count carrying four to seven years.

She was also ordered to pay a fine of about $109 million.

The stolen money was sent to accounts at a branch of RCBC in Manila, then headed by Deguito, before it disappeared into the casino industry in the Philippines.

Manila urged to expedite case

A former treasurer of RCBC, and five other employees of the bank branch from where the cash was withdrawn, are also facing money-laundering charges.

Earlier this month, Bangladesh urged the Philippines to expedite the cases against the remaining six RCBC officials after Deguito's conviction.

The Philippine central bank fined RCBC a record one billion pesos ($19.17 million) in August 2016 for its failure to prevent the stolen money from being moved through the bank.

Of the $101 million stolen in the heist, $20 million was recovered from a Sri Lankan bank, while the remaining $81 million, which landed at RCBC, has yet to be retrieved.

On February 5, 2016, unidentified hackers stole $101 million from Bangladesh Bank's account with the Federal Reserve Bank of New York, using fake orders on the SWIFT payment system. It was one of the largest cybercrimes in the world.

The lawsuit comes three years after the cyberheist, which saw $81 million siphoned off to accounts at RCBC.