Photo: Daily Messenger
Serious allegations of corruption and irregularities, including loan fraud, embezzlement, commission trading, and illegal recruitment, have surfaced around the activities of the partnership sub-branch of NRBC Bank and SKS Foundation. Loan irregularities amounting to approximately Tk 3,343 crore in the name of microfinance partnership banking have occurred due to the misrepresentation of the microcredit scheme launched under the sub-branch.
It has been alleged that 131 sub-branches of NRBC Bank have strategically been controlled by the SKS Foundation, and crores of taka have been embezzled through the directors' vested interests in the name of decoration.
According to the investigation, in collusion with Rasel Ahmed Liton, the executive director of the Gaibandha district-based NGO SKS Foundation, which is controlled by the trusted and close associates of the bank's chairman Parvez Tamal, vice-chairman Rafiqul Islam Arzu, and executive committee chairman Adnan Imam, a scheme of embezzlement of bank funds, commission trading, and money laundering has been orchestrated.
With this malicious intent, the 'Programme Guideline for Microcredit' was approved at the 108th council meeting held on November 30, 2020. Under the supervision of Harunur Rashid, the DMD and CFO who was the mastermind of the bank's financial corruption syndicate, the Microcredit Division was formed. Moreover, in a blatant violation of financial propriety, the CFO was made responsible for approving loans.
According to the rules, the task of approving loans lies with the bank's Loan Division. However, by misleading the board through the Tamal-Arzu-Adnan nexus, they have been embezzling depositors' money under the guise of a microcredit finance programme operating solely through the SKS Foundation.
According to Bangladesh Bank sources, the central bank approves the operation of micro-loan activities only through branches and sub-branches of the bank's own network. Through central bank's BRPD Circular no – (P-3)745(60)/2021-1462, approval was taken to open 131 sub-branches in North Bengal.
According to the special investigation, on January 28, 2021, in the 113th board meeting of NRBC Bank, the sub-branches were approved only for the expansion of microcredit. But by misinterpreting the approval of Bangladesh Bank, NRBC started a hybrid system called 'Partnership sub-branch' by selecting only SKS Foundation as microfinance programme partner. It was approved by the 114th, 117th, and 119th board meetings of the bank held in February, March, and April 2021.
According to the directors of the bank, it was decided to open 131 sub-branches of the bank in phases in the NGO office run by SKS Foundation in its own building (tin-shed or semi-paved), and Tk 5,00,000 was allocated for the decoration of each partnership branch. Out of which Tk 1,00,000 for interior decoration, Tk 1,00,000 for buying furniture, and Tk 3,00,000 for miscellaneous sectors.
Without inviting any tenders, the decoration work for all branches and sub-branches of the bank was carried out through Lanta Services Limited (account no. 0121333000000350 at Bonani branch) and TSN Trade and Infrastructure Development Limited (account no. 0101333000002045 at Principal branch), both anonymous entities owned by the Tamal-Arzu-Adnan nexus. Additionally, excess funds were misappropriated for decoration and supply of various materials through NRBC management (account no. 0101364000000010 at Principal branch).
Meanwhile, in light of the letter issued on January 16, 2023 (memo no. 00.01.0000.411.01.006.2022.1965) by the Anti-Corruption Commission (ACC), in addition to seeking information on the corruption committed through the SKS Foundation, the ACC has also demanded further investigation by requesting information, contracts, bill-voucher records regarding various irregularities and corruption in the procurement process for interior decoration and furnishing of branches and sub-branches. However, for mysterious reasons, there has been no progress in the investigation.
Moreover, in the special inspection report of FICSD of Bangladesh Bank for the year 2022, instances of misappropriation of funds in the name of branch and sub-branch decoration through various establishments owned by the bank directors have come to light, without following proper procurement policies. This constitutes a violation of the Bank Company Act of 1991 and the regulations of Bangladesh Bank.
According to the bank’s board meeting, NRBC Bank has been paying commission and service charges at the rate of 0.50 percent to 2 percent on disbursement, collection, and collection of deposits to SKS Foundation since 2021 outside the agreement.
As per the managing director's letter issued last February 19, 131 partnership branches are currently planned to be converted into full-fledged sub-branches, and 32 partnership branches have already been converted into sub-branches. It is evident from this that in the 131 branches managed by SKS Foundation, adequate security, decoration, and customer service were not ensured according to the standards of conventional banking branches when the so-called partnership branches of the bank were started.
According to the information, the root cause of the inadequate security was the reckless opening of partnership sub-branches for the benefit of Tamal, Arzu, and Adnan. And due to the security vulnerability, on January 10, the vault of the NRB Bank's Pallimangal Partnership Sub-branch in Bogura was broken into, and money was looted. Recently, the issue of lack of security and high risk in partnership branches also came up for discussion during the incident of hacking the national identity card server.
According to sources from Bangladesh Bank, in January 2023, despite objections raised regarding the misinterpretation and activities related to the approval of opening 131 partnership sub-branches from Bangladesh Bank's BRPD, the company secretary of the bank and an official with the portfolio of SEVP quickly suppressed the matter by influencing high-level officials of Bangladesh Bank through their promptness.
According to the letter reviewed by Md Golam Aulia, it is known that until December 2023, the bank's outstanding loan disbursed under the name of microcredit for the SKS project stood at Tk 3,343 crore. Additionally, at least Tk 202 crore in loans were disbursed from the bank's various branches and sub-branches in the name of other affiliated organizations such as SKS Foundation, SKS Inn, and SKS Hospital.
Despite SKS being one of the top 20 loan customers of the bank, large-scale loans were provided by the microfinance sub-branches under special consideration, which goes against normal banking practices.
Moreover, according to the minutes of the bank's 115th board meeting held on February 28, 2021, a decision was made to appoint 300 field officers, along with Assistant Managers and Managers, for the microcredit programme. Additionally, contractual appointments were made for the positions of Assistant Teller, Teller, and Branch In-Charge for the partnership sub-branches.
According to the agreement executed between the bank and SKS Foundation in 2023, although SKS Foundation had sole authority under the microcredit partnership programme, the bank would be responsible for paying their salaries, which is contrary to the bank's interests. The Bangladesh Bank investigation team has found evidence of widespread bribery in these contractual appointments.
On the other hand, sources from the Dhaka Stock Exchange revealed that Rasel Ahmed Liton, the Executive Director of SKS Foundation, through his personal BO account no. 1205950073627704 and SKS Foundation's BO account no. 1205950073534838, is allegedly involved in stock manipulation and collusion with share gamblers like Parvez Tamal, Rafiqul Islam Mia Arzu, Adnan Imam, and others in various stocks, including NRB Bank.
When asked about the overall matter, Rasel Ahmed Liton, Managing Director of SKS Foundation, told The Daily Messenger, “It was not possible for an organisation as big as ours to operate with personal funds. Therefore, we had to take loans from the bank, and we did so while following all rules and regulations. We did not resort to any manipulation. This animosity is being spread because we work with NRB Bank. Anyone can investigate and see that we have no ulterior motives or activities here.”
When asked, Md Mezbaul Haque, Executive Director and Spokesperson of Bangladesh Bank, told The Daily Messenger, “All matters related to the banks are under our supervision. Any kind of manipulation is detected in our investigations. Our off-site and on-site inspection teams conduct investigations, and if any irregularities are found, we will take action as per the Bank Company Act.”
Messenger/Howlader
