Forum Discussion on Money Laundering:

1.       Post some newspaper articles on Money Laundering Incidents in Bangladesh

Ans: In Bangladesh, the equivalent of 36 per cent of the annual tax collected is smuggled abroad. This information was provided by the United Nations Trade and Development Organization (UNCTAD). Considering the amount of tax collected in 2015, UNCTAD has calculated the money laundering. However, it was not stated how much money was smuggled that year.

According to UNCTAD, most of the money is laundered through false declarations in import-export activities. Economists believe that money laundering has increased in the last four years.

According to the Ministry of Finance, in the financial year 2014-2015, the tax revenue in this country was 1 lakh 40 thousand 8 crore. Considering the information given by UNCTAD, about 50 thousand 640 crore taka was smuggled from Bangladesh that year.

An Uncategorized report on Least Developed Countries (LDCs) released on Wednesday states that money laundering is rampant in almost all of the 47 Least Developed Countries (LDCs). Money laundering ranges from 36 to 115 percent of the tax revenue of the least developed countries.

The Center for Policy Dialogue (CPD), a private research organization, published the report on behalf of UNCTAD. A press conference was called at the Economic Reporters Forum (ERF) auditorium in the capital's Paltan on the occasion of the release of the report.

UNCTAD says that preventing tax evasion through import-export activities is a big challenge for a country like Bangladesh. About 7% of Bangladesh's trade with developed countries is based on false declarations.

Ahsan H. Mansoor, executive director of the Policy Research Institute (PRI), a private research institute on money laundering, told Prothom Alo that the calculation of money laundering in proportion to tax revenue may be correct. Tax collection has increased in the last few years, so the amount of money laundering has also increased. It has been speculated that money has been smuggled out of the country for a long time. It is not possible to determine exactly how much money has been smuggled.

According to him, as long as there is a way to get money illegally, money will continue to be smuggled. Bangladesh is now the number one bribery provider in South Asia. As long as this prevalence lasts, black money will be earned. He further added that in the face of international pressure, money laundering has been tightened. But is there any fruit coming? My answer is no. '

Money laundering has increased through import-export activities. Recently, some cases of money laundering have also come out. The National Board of Revenue (NBR) has investigated several such incidents. For example, the export value of Rupali Composite Leatherwear Limited, a Crescent Group company, was not refunded at Tk. 389 million as against 190 bills. This means that this money has been smuggled abroad. This month alone, 15 people, including Crescent Group Chairman MA Quader, have been charged with money laundering. Last year, an organization called SB Exim smuggled around Tk 300 crore in the name of exporting terracotta tiles to various countries in the Middle East. Besides, Bismillah Group smuggled around Tk 3,000 crore by exporting garments a few years ago.

In response to how money is smuggled, CPD Special Fellow said in a press conference yesterday that 80 per cent of money laundering is through false declarations in import-export activities. If money laundering could be stopped, tax collection would increase further. That money was invested in the country.

Bangladesh is 'moving forward' in money laundering. Despite lagging behind most of the economic indicators, Bangladesh is moving ahead illegally in money laundering that’s according to the latest report from the US-based Global Financial Integrity (GFI).

There is no information about how much money is smuggled abroad every year. Trade manipulation Economists and bankers say that the cases of money laundering from Bangladesh are coming to court like dots in Sindh. That means no one knows most of the facts.

Money laundering from Bangladesh to abroad take place in several ways. One of the big ways is to manipulate trade. No matter how strict the government's laws may be regarding remittances from Bangladesh, the reality is that money laundering has not stopped.

Traffickers are also constantly finding new tactics.

Officials at the Anti-Corruption Commission and the Financial Intelligence Unit say the smuggled money may be used to buy homes and assets abroad or to invest in businesses.

When money is smuggled out of the country, the value of the dollar artificially rises and the country's currency becomes unstable. The money that is being sent out of the country is not being invested in the country. If there was investment in the country then employment would increase. "

Bank officials and lawyers say it is difficult to bring money back into the country once it has been laundered.

There is not a single example of that. Arafat Rahman, the youngest son of BNP leader Khaleda Zia, was brought back from Singapore in 2012 for Tk 21 crore. It is often difficult to find information on money laundering. Attempts to gather information on which Bangladeshis have money in Swiss banks have made no progress in less than a year.

According to a research report in Bangladesh, a lot of money is being smuggled out of Bangladesh every year through international trade. According to a study by the Bangladesh Institute of Bank Management or BIBM, a research institute in the banking sector, these money laundering incidents are taking place through import and export. Researchers say that the incidence of money laundering from Bangladesh is very high but it is not possible to say exactly how much money is being smuggled.

"Suppose one thing is exported from here to China and the amount is said to be imported from there - the difference between the two calculations is calculated by imagining a number."

Some case studies have been collected while conducting this study. It found that some of the products, which are subject to higher tariffs, may have been imported from abroad, but at the time of the declaration, it was stated that some products, such as poultry feed or poultry feed or industrial equipment, were imported at lower tariffs.

Money laundering of Bangladeshis has decreased, but money laundering has not decreased

There has been a lot of talk lately about money laundering. Some may call it a seasonal discussion. There are basically two seasons to discuss money laundering. In March of each year, the New York-based organization Global Financial Integrity (GFI) publishes a global report on money laundering. Then the discussion about money laundering started. The government also made some ambitious and memorized promises.

The next discussion is in June. Switzerland's central bank, the Swiss National Bank (SNB), released its annual report, Banks in Switzerland. There is information about how much money the citizens of any country have in Swiss banks. That report, however, contains the amount of money, not the names of the citizens.

Now, of course, is the season for money laundering? Because of the coronavirus, GFI did not publish their report twice in a row. As a result, the March season was in vain. Negotiations for the June season, however, began before the release of the Swiss bank report. The credit for this goes to a few MPs. They criticized the government's inaction on money laundering. The Finance Minister also has to respond to these discussions of some MPs in the budget session. Especially when the finance minister himself wants to know the names of the money launderers, the question actually arises about the government's commitment against the money launderers.

The Swiss National Bank (SNB), the central bank of Switzerland, last Thursday released its annual report titled 'Banks in Switzerland-2020'. According to the report, by the end of 2020, the amount of money deposited by Bangladeshis in the country's banks is 573 million Swiss francs. In Bangladeshi currency the amount is about 5 thousand 203 crore rupees (1 Swiss franc = 92.28 rupees). In the previous financial year it was 80 crore 30 lakh Swiss francs. In other words, the amount of money deposited by Bangladeshis in Swiss banks has decreased by 7.6 percent in one year. With this, the amount of money of Bangladeshis in Swiss bank has decreased for three consecutive years.

It cannot be said that all the money kept in Swiss bank is illegal. It can be seen that the money smuggled from Bangladesh in various ways is deposited in various banks in Switzerland, just as Bangladeshis living in different countries of the world also deposit money in that country. So here are all the meanings of legal and illegal. However, the Swiss banking system has a worldwide reputation for protecting customers' privacy. For this, the country has made a law. So there is a lot of secret money here.

If one thinks that money laundering from Bangladesh has decreased from the information that the amount of money kept by Bangladeshis in Swiss Bank has decreased for three consecutive years, it will not be correct. Now the Swiss banks no longer have that roaring business. Swiss banks could not disclose any customer information under the Swiss Banking Act of 1934, but much has changed since the Obama administration enacted the Foreign Account Tax Compliance Act in 2010. Under the law, Swiss banks are now required to provide certain customer information. According to the United States, several European countries have now taken steps to obtain information. Even neighboring India has signed an agreement called Automated Information Exchange. As a result, Swiss banks are not able to adhere to strict confidentiality policies as before. Pressure is mounting on Swiss banks to move away from privacy policies. In addition, new places or sources have been created around the world to keep the money being smuggled. In countries like Cayman Islands, Luxembourg, United Kingdom, United States, Singapore or Hong Kong, there are many ways to open a company and keep money. As a result, Swiss banks no longer have a monopoly on money laundering.

Documents previously published by the International Organization of Investigative Journalists (ICIG) as Panama Papers or Paradise Papers contain the names of more than 50 Bangladeshi businessmen or organizations. All of them have opened anonymous companies and smuggled money. Bangladeshi businessmen also have big business in different countries including Singapore, Dubai, Hong Kong, Thailand, United Kingdom and United States. Numerous information about buying a house in Malaysia or Canada has been published in newspapers at different times. Everyone knows this information. So Swiss banks are no longer the only destination for money laundering.

For example, there is information that Tk 5,000 crore has been deposited in the Swiss bank.

Meanwhile, our government has decided that it will once again provide people the opportunity to whiten black money during the budget announcement. This, according to experts, incentivizes money laundering. Besides that, lack of regulatory monitoring and supervision of financial activities of individuals and enterprises is allowing criminals to hide their actual financial reports. And in the absence of proper coordination between agencies (domestic and international), preventing financial crime becomes even more difficult.

Sadly, Bangladesh meets almost all the requirements necessary to make it a perfect victim of largescale money laundering—including the fact that its government's policies have fallen far short of disincentivising money laundering and have, in fact, facilitated it at times. That has mostly happened because, the perpetrators of the crime have usually been "tied to the power structure" and hence have often "determined the terms" that have allowed them to get away with it.

2.       What is the difference between placement and layering stage?

Ans: Money laundering placement is the process of placing unlawful proceeds into financial institutions through deposits, wire transfers, or other means. The money is placed into the financial system through banks, casinos, shops, and other businesses in the placement stage.

The difference between placement and layering stage are below,