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Money laundered thru terracotta tile export

The amount of money 2 billion bill for the exported tiles is now not being paid. However, Bangladesh Commerce Bank, owned by government and private companies, had bought the bill and has already paid Tk 1.90 billion to Exim.

The four foreign banks which had sent the purchase order have no operations whatsoever in their own countries and are not even approved for the operations.These banks are known as ‘shell banks’. Restrictions have been imposed globally against dealing with these banks.The beneficiary of this money at home and abroad is Shahjahan Bablu, chairman of SB Punno Group.

According to the website of the group, Shahjahan Bablu is a business magnate of Bangladesh. He has five business establishments in Dubai and Singapore. Prothom Alo has confirmed the existence of his business establishments.

The money laundering investigation organisation, Bangladesh Financial Intelligence Unit (BFIU), has carried out an inquiry into the matter and said Shahjahan Bablu has laundered Tk 2 billion in the guise of business. He has also embezzled Tk 1.90 billion.

BFIU has sent letters to NBR’s VAT Audit, Intelligence and Investigation Directorate, the Criminal Investigation Department (CID) of police and the Anti-Corruption Commission (ACC) to take action against Shahjahan Bablu and the Commerce Bank officials who are involved.

BFIU chief Abu Hena Md Razi Hasan said, “It is our responsibility to inform the law enforcing agencies. Now it is their responsibility to take action.”

Purchase order at high price

Three companies in UAE gave orders to SB Group to purchase the terracotta tiles. Of the companies, Bangladeshis own two.

Bangladesh’s Mohammad Rafiuddin and Sabia Afrin are the proprietors of Handyware International General Trading. Mohammad Rafiuddin is also proprietor of Al Mawad General Trading.

According to bank documents, the two companies imported tiles from Bangladesh although they are registered to deal in leather items and animal fur.Another company is Millstream Global General Trading. These three companies opened 72 LCs of Tk 3.50 billion in 2018 to import tiles.

The tiles SB Group export cost 10 dollars per piece.According to the investigation, the price of a tile was shown ten to one hundred times higher in the export bill in order to get an inflated payment from the bank.

LC from shell banks

Commerce Bank obtained Letter of Credit (LC) from four foreign banks to buy the tiles from SB Exim. Those four banks cannot operate in their own countries and they don’t have any branches there either. No central banks have any control over such banks which are known globally as ‘shell banks’.

The global anti-money laundering body financial action taskforce (FATF) guidelines strictly prohibit any transaction with shell banks. Bangladesh Bank has also strong directives against shell banks.

Businesses in Dubai and Singapore

According to SB Punno Group’s website, they have at least five different types of businesses in Dubai and Singapore. The company has sister concerns named Punno Jewellery in Dubai, Punno Foodstuff Trading and Punno General Trading in UAE. In Singapore, they have business concerns named ‘Punno Gold and Diamond PTE LTD’ and ‘Punno Supermarket PTE LTD’.

What stakeholders say

BFIU investigation said that records of SB Exim’s export bill documents had clearly mentioned that the client is a defaulter. The then managing director of Commerce Bank Securities RQM Forkan, additional managing director Zafar Alam and deputy managing director Kazi Reazul Karim gave a nod to purchase the bill. QM Forkan is currently the MD of Commerce Bank Securities.

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