Photo: Collected
For the last few decades, Switzerland had been considered a haven for storing black money. But over the last two to three years, that picture has started to change. Instead of Switzerland, money launderers are now mainly turning to Dubai. Besides, money is being laundered in places like the British Virgin Islands, Luxembourg, Cayman Islands and Bermuda. However, Bangladeshis are said to be the largest group that launders money to Dubai, a city in the United Arab Emirates (UAE).
Analysts said the secrecy that Switzerland used to maintain when it comes to depositing money in Swiss banks no longer exists. That is why people are withdrawing money from there and keeping it in other places, such as Dubai and Canada, to protect privacy. Bangladeshis are now laundering money to many countries, including the UAE, the US, Canada, Australia, and Malaysia, as an alternative to Switzerland.
According to Anti-Corruption Commission (ACC) sources, money launderers have started to dominate Dubai over the past decade. In particular, laundering money to Dubai has increased significantly in the last three years. Most of the money laundering complaints and cases that the ACC has involve Dubai.
A senior official of the ACC, who did not wish to be named, told The Daily Messenger that many people have chosen Dubai as a new destination for money laundering since Europe and America have imposed various restrictions over the past four to five years. In particular, businessmen involved in money laundering have mostly invested in Dubai.
According to the latest annual report published by Swiss National Bank (SNB), the central bank of Switzerland, the amount of money deposited by Bangladeshis in Swiss banks has decreased significantly for two years. At the end of 2022, the amount of money deposited by Bangladeshis in various banks in Switzerland was 5 crore 53 lakh Swiss francs. In 2023, it decreased to 1 crore 77 lakh francs. In Bangladeshi currency (at Tk 132 per franc), the amount is Tk 234 crore. That is, in one year, Bangladeshis have removed 3 crore 76 lakh francs from the banks of the country. As a result, deposits in Swiss banks decreased by 68 per cent. In the previous year, this reduction rate was 94 per cent.
According to the data of that report, the money deposited by Bangladeshis in Swiss banks was 87 crore 11 lakh francs in 2021. By the end of 2022, it decreased to only 5.5 crore francs. From there, it dropped to 1.75 crore francs at the end of 2023. In other words, the deposits of Bangladeshis in Swiss Banks decreased by 11 thousand crores francs in two years.
The report said that last year, Bangladeshis had the least money in Swiss banks in 28 years from 1996 to 2023. And the highest was 87 crore francs in 2021. People related to the banking sector said that not all of the money deposited in Swiss banks is illegal or involves laundering. This is because many institutions and individuals can deposit money in the country legally.
In this regard, Ahsan H Mansur, executive director of Policy Research Institute (PRI), told The Daily Messenger that since Switzerland has now come under the international agreement on providing information on money laundering, launderers have changed their destinations. “Launderers used to have the opportunity to keep the money secretly in Swiss banks. But now they are not getting that opportunity. So, they move the money somewhere else like the UAE, Canada, or any other country where privacy is protected. All those countries protect the secrecy of money laundering.”
He also said that many may have withdrawn their deposits due to the recent economic crisis. “Because of this, the money of Bangladeshis deposited in the country's banks decreased significantly last year. However, money laundering has not decreased. Rather, it has increased more than before.”
Meanwhile, a portion of the money held in Swiss banks is believed to be laundered. However, no specific information about laundering is available. It is not even known how much money is owed by customers as deposits. The central bank of Switzerland publishes all data in an aggregated form for privacy reasons. No customer or bank information is separately mentioned in the report.
Switzerland has a long-standing reputation for holding money in secret. Swiss banks strictly keep the identity of customers confidential. That is why illegal income and money collected through tax evasion are deposited in Swiss banks. The Swiss National Bank has been publishing annual reports for a decade without providing specific customer information. This information is emerging. However, the report does not explain why the deposits of Bangladeshis are suddenly decreasing after increasing continuously for almost a decade.
According to the report of the Swiss central bank, it is not only the money of Bangladeshis that has decreased in the banks of Switzerland. Citizens of India, Pakistan, Singapore, and Nepal have also seen a reduction in their deposits in Swiss banks. Indian deposits in Swiss banks in 2022 were around 340 crore Swiss francs, which more than halved to 103 crore francs last year. Similarly, in 2022, Pakistani deposits in the country were 39 crore francs, which decreased to 29 crore francs last year.
In 2022, the amount of money deposited by Singaporeans in Swiss banks was 4,787 crore francs. Last year, it decreased to 4,547 crore francs. The deposits of Nepalis also decreased by 3 crore francs to 45 crore francs in one year.
Mohammad Nurul Amin, former chairman of the Association of Bankers Bangladesh (ABB), told The Daily Messenger that the deposits of Bangladeshis in Swiss banks are decreasing. “One reason for this may be that Switzerland is currently publishing country-specific reports. Depositors are afraid of having their identities revealed. Another reason could be that profit is where the money goes. As a result, the price of the dollar increases and Bangladeshi depositors move their money from Switzerland to other countries.”
Washington-based research and consulting firm Global Financial Integrity (GFI) works on money laundering. The agency estimates how much money is laundered from any country under the guise of trade. According to GFI estimates, an average of Tk 64,000 crore is laundered annually through false declarations of import and export of goods from Bangladesh.
Messenger/Fameema
