Authorities remain silent over fund embezzlement by BPC partner firm

Legal action is yet to be taken against Standard Asiatic Oil Company Limited (SAOCL), a partner company of Bangladesh Petroleum Corporation (BPC), which was found to be embezzling Tk 134 crore in two years.

The power ministry and the Anti-Corruption Commission (ACC) continue to remain silent over the matter although evidences were found against two officials of SAOCL through an ongoing investigation being conducted by the BPC.

Moinuddin Ahmed and Mohammed Shahed are the director and general manager of SAOCL, which owns a 50 per cent stake in BPC. The pair allegedly misappropriated the funds between 2011-18, according to the primary investigation report.

Initial findings suggest that the total amount of money embezzled from SAOCL could actually be much higher, BPC officials said.

Ahmed represents the shareholders from the Asiatic Oil Company Limited (AOCL), which owns a 50 per cent stake in SAOCL. The rest of the oil blending company is owned by BPC and is represented by Shahed.

"Ahmed and Shahed are getting away due to the ministry's indifference on the matter and ACC's prolonged investigation. SAOCL plans to show unusual profits during the upcoming AGM on June 25 by covering up the irregularities," the BPC officials added.

In March this year, SOACL issued a letter to AOCL, requesting a Tk 124.24 crore payment for outstanding sales in the previous year although it initially demanded only Tk 1.74 crore just two months back.

AOCL was allegedly shocked by the letter and, in their response, asked how SAOCL could make such an abnormal demand.

"Shahed and Ahmed are trying to cover their corruption by claiming such an abnormal sum is owed. We sent several letters to SAOCL to clarify the matter but they have not yet replied," an AOCL official told The Daily Star.

Only after objections were raised in this regard with the BPC and SOACL's board of directors, a committee was formed to investigate the matter, he added.

Abu Monsur, chairman of the Board of Directors of SAOCL, insisted that the allegations of their demands being abnormal are baseless.

"For a long time now, products sold between the two companies have not even been properly accounted for since AOCL owns 50 per cent of SOACL. But since an investigation committee has now been formed, the truth behind who was responsible for losing track of so much money will surely come to light," Monsur told The Daily Star.

Regardless of the outcome, AOCL intends to reclaim the funds. If the company's demands are not met, then AOCL will recover the money by selling their stake in SAOCL, Monsur added.

Evidence proving the embezzlement of more than Tk 134 crore over a period of just two years has already been found. However, this value could be much higher as irregularities at SAOCL have been prevalent for the past eight year.

"We are yet to get any evidence of irregularities in the remaining six years as SAOCL's authorities are not cooperating well. To address this issue, we sent a letter to the ministry and ACC on August 25, 2019, recommending that punitive measures be taken against the persons responsible," said BPC chairman Shamsur Rahman.

It remains unknown whether the relevant authorities will take action in this regard.

These two officials have squandered crores of government funds with consequence for a long time as even with evidence, the BPC can do next to nothing due to legal constraints, Rahman said.

After receiving the initial investigation report and recommendations for corrective measures from the BPC, the ACC was told to take action, said Md Abu Jobayer Hossain Bablo, joint secretary of the Ministry of Power, Energy and Mineral Resources.

However, Bablo did not comment when asked why the ministry is relying on other agencies to take legal action when they themselves have the power to do so.

Even before receiving letters from the ministry and BPC to address the issue, the ACC had found evidence of irregularities against SOCAL through an independent investigation held at the end of 2018.

On March 12, 2019, the ACC seized both Ahmed and Shahed's passports while also directing every land, sea and airport to restrict the two officials from leaving the country.

The ACC also formed a separate investigation committee to look into 15 specific allegations of irregularities at SAOCL. Although investigation is already underway, the committee have not provided any reports so far.

"We found evidence that at least Tk 57 crore was transferred to two private company accounts," said ACC Deputy Director Mahamudur Rahman.

Besides, there were around 15 other allegations to investigate, including tender manipulation and sales irregularities.

"We were unable to complete our investigation sooner due to the coronavirus pandemic, the ACC deputy director said, adding that the exact amount of money embezzled will become clear only after investigations are complete.

When contacted, SAOCL Director Ahmed did not respond while Shahed, general manager of SAOCL, claimed to be uninvolved with said irregularities.

"Some former employees filed complaints against me by supplying false information to the media, BPC and ACC. These workers are complaining that they lost their jobs due to these irregularities," Shahed said.

The company's operations have always been carried out with approval from the board of directors. Therefore, maybe the irregularities the BPC and ACC spoke of could have been caused by simple gaps in documentation.

"And so, we are now trying to calculate the value of previous sales to ascertain how much money is actually missing," the SAOCL general manager added.