More frauds unearthed

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The central bank has found more irregularities in Oriental Bank’s operations including forgery of cheques and foreign drafts and smuggling of foreign currencies by some shareholders in collusion with a section of bank officials.
After taking over Oriental Bank in June last year, the central bank found the irregularities by carrying out a special investigation of Oriental’s 30 different branches.

During the investigation, the central bank found that a section of officials of different Oriental branches had removed transaction records of many accounts from the computerised database and embezzled a large amount of money through the process.

Terming such types of activities as ‘major irregularities’ the central bank said such types of activities are totally illegal and most harmful for both the bank and its clients.

Citing an incident that had taken place in Oriental Bank’s Gulshan branch in 2003, the central bank report revealed that some of the Oriental officials had been involved in smuggling a huge amount of foreign currencies out of the country.

The central bank report said in the name of importing waste papers the embezzlers smuggled a total of $1.8 lakh out of the country through Oriental’s Gulshan branch with the help of a section of its officials.

When the central bank investigation team sought documents related to these irregularities, officials of Oriental submitted fake documents to the investigation team.

The central bank investigation failed to trace whether the supposed imports had entered the country at all. The Oriental Bank officials also failed to show any customs document issued by the Chittagong Port, the Bangladesh Bank (BB) report said.

The central bank investigation found a foreign currency draft of $13,220 at Oriental Bank’s Mirpur branch, on which the name of the beneficiary had been tampered with. Some bank officials embezzled the amount themselves by changing the beneficiary’s name on the draft.

In the same branch, an Oriental official embezzled Tk 16.66 lakh from a client’s account by copying the client’s signature.

The central bank report said some officials of Oriental in different branches also looted a large amount of money in the name of incentives marked for them for increasing money deposits in the bank through expanding the client base.

The report said these officials pocketed a huge amount of incentives, but there is no document on how much money was paid to them by the bank against what amount of deposit. Also in the name of incentives to bank officials for bringing in money from the call money market the bank paid an unusually large amount to them, the report added.

According to the central bank rules and regulations, a bank cannot lend money to a person or organisation amounting over 15 percent of its total capital. But Oriental provided large amounts of loans from its difference branches bypassing the central bank’s rules and regulations, the report said.

Sources in the Bangladesh Bank said these are only the tip of the iceberg of examples of irregularities in Oriental Bank.

Meanwhile, the central bank already sent its report to the Oriental Bank authorities and Anti-corruption Commission (ACC) for taking actions against the bank officials and owners who had been involved in such a rampant corruption.

ACC sources said based on the BB report they already filed some cases against some bank officials and some more cases will be filed.

Oriental Bank sources said the bank authorities already suspended around 50 bank officials and they are discussing with their lawyers some other possible actions against the guilty officials and their paymasters.

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