The Bangladesh central bank has recommended the removal of AB Bank Ltd. Chairman M. Wahidul Haque for his alleged involvement in money laundering, The Daily Star reported.
Haque, former managing directors M. Fazlur Rahman and Shamim Ahmed Chaudhury and former head of financial institutions and treasury Abu Hena Mustafa Kamal were all reportedly directly involved, according to a report from the Bangladesh Bank.
An investigation by the regulator found that AB Bank allegedly laundered around 1.65 billion Bangladeshi taka to the United Arab Emirates through two questionable organizations. The central bank said the board of AB Bank approved the investment of US$20 million in Singapore-based investment company Pinnacle Global Fund Pte. Ltd. in December 2013. The bank's offshore banking unit then allegedly laundered the money to an account at the UAE-based Abu Dhabi Commercial Bank PJSC
The account belonged to Cheng Bao General Trading LLC, which was a special purpose vehicle for Pinnacle Global Fund. Cheng Bao withdrew the money and closed the account. There were no documents to prove that Cheng Bao was authorized to work as a special purpose vehicle or a mediator.
The central bank alleges that Wahidul was aware of the act as he was a joint signatory of the account. Wahidul told the publication that the fund would be returned to Bangladesh at the shortest possible time. The chairman also denied that he was a joint signatory of the bank account.
The central bank had asked AB Bank on Oct. 13 to suspend Abu Hena from his job at the bank. The regulator also asked AB Bank to stop borrowing, investing and lending money through its offshore banking unit.
As of Dec. 15, US$1 was equivalent to 82.67 Bangladeshi taka.