Suspected transaction reporting on the rise
Reports on suspicious transaction and activity received by the Bangladesh Bank's anti-money laundering department rose more than 54 percent year-on-year in fiscal 2015-16.
During the year, the Bangladesh Financial Intelligence Unit (BFIU) received 1,687 suspicious transaction reports (STR) and suspicious activity reports (SAR).
The information was revealed in the unit's annual report for fiscal 2015-16.
The BFIU is responsible for analysing STR, SAR, cash transaction reports and information related to money laundering and terrorist financing received from reporting agencies and other sources.
It then disseminates the information to law enforcement agencies.
The unit is also empowered to supervise the activities of reporting organisations and carry out on-site inspections.
“The rise in the number of STR/SAR from the reporting entities illustrates the efficacy of the BFIU's initiatives in furthering awareness of anti-money laundering (AML) and combating the financing of terrorism (CFT) among the reporting organisations,” the annual report said.
The number of cash transaction report (CTR) and the transaction volume involved increased 39.36 percent and 19.46 percent respectively from a year earlier.
The unit for the first time received the CTR from non-banking financial institutions involving an amount of Tk 246 crore.
In the same fiscal year, the unit disseminated 180 intelligence reports to law enforcement agencies, mostly to the Anti-Corruption Commission and the Criminal Investigation Department for their next course of action.
The BFIU also conducted AML and CFT inspections on 56 bank branches.
During the inspections, no bank branch got “strong” rating, whereas the majority of them received “fair” and “marginal” rating.
Three banks were rated “satisfactory”, 28 banks “fair”, and 24 banks “marginal”. One bank was rated “unsatisfactory”. The annual report did not name the banks.
Among the NBFIs, 77.8 percent of the head offices got “fair” rating and 22.2 percent “marginal” rating.
On the other hand, 70 percent of the NBFI branches got “fair” rating and 30 percent “marginal” rating. No branches received “unsatisfactory” rating.
The BFIU got 31 requests from FIUs of different countries in fiscal 2015-16 compared to 17 the previous year.
All the requests for cooperation were entertained with utmost care by the unit, according to the annual report.
In fiscal 2015-16, the unit sent 186 requests to foreign financial intelligence units (FIU), most of which were related to the cyber heist of the BB reserve account.
In the reported fiscal year, the BFIU received 91.7 percent of the total STRs/SARs from banks.
Despite having the lowest number of branch network and clients, foreign banks submitted the highest number of STRs/SARs: 642.
Private commercial banks and Shariah-based banks submitted 511 and 362 STRs/SARs respectively.
Although foreign banks remain on top in terms of the number of STRs/SARs, their contribution to the total STR has gradually fallen over the previous three fiscal years, whereas the contribution of Shariah-based banks has risen sharply.
Some 99.86 percent of the suspicious transactions involving Tk 3,031 crore were transacted in different categories of banks.
Shariah-based banks made the highest contribution to the transaction volume, followed by state banks. Though state banks had negligible contribution to the number of STR, they reported 32.5 percent of the total volume of suspicious transactions.
On the other hand, the transaction volume reported by foreign banks was the lowest.
Most STRs/SARs reported in fiscal 2015-16 were related to male accountholders: 97.37 percent accounts were owned by male customers. Cash, online transaction and clearing cheques are the major types of financial instruments involved in the reported STRs.
Cash comprised 62.72 percent of the total STRs, whereas 23.55 percent reported suspicious transaction were related to online transaction and 12.31 percent to clearing transaction.
Division-wise, 64.6 percent of the STRs/SARs involved transactions from branches located in Dhaka division, followed by 21.35 percent in Chittagong division.
STRs reported in fiscal 2015-16 indicate that a major portion of the money movement took place within Bangladesh. Besides, foreign fund movements also took place from the UK, the US, Kosovo, Pakistan, Turkey and Nigeria.
Some 18.78 percent of the disseminated cases were related to fraud and 12.15 percent to kidnapping. The two crimes also topped the STR/SARs reported in fiscal 2014-15.
To boost international cooperation, the BFIU signed agreements with the FIUs of Australia, China, Jordan, Lebanon, Kazakhstan, Nigeria, Uzbekistan, and Macao in 2015-2016, taking the tally to 43.