https://www.thedailystar.net/news/bangladesh/crime-justice/news/bfiu-finds-ni-mazumders-money-laundering-links-3816461

Nazrul Islam Mazumder, chairman of Nassa Group and a close associate of deposed prime minister Sheikh Hasina, has been accused of trade-based money laundering amounting to Tk 16,000 crore by the Bangladesh Financial Intelligence Unit.

Of the sum, Tk 4,717 crore was taken out from Exim Bank, where Mazumder was the chairman from 2007 to August 29 last year, through 18 shell companies, according to the BFIU, the government agency responsible for investigating money laundering, suspicious transactions and cash transaction reports.

The remaining Tk 11,283 crore was taken from 20 other banks and a non-bank financial institution.

The alleged money laundering activities and irregularities were conducted through import and export transactions involving Exim Bank, National Bank and state-owned Janata Bank using companies linked to Mazumder.

The BFIU report highlights trade irregularities linked to Madina Dates & Nuts, a company owned by Mojammil Hussain, Mazumder's son-in-law.

The company, registered in July 2020, opened 253 import letters of credit (LCs) amounting to $46.3 million from September 2020 to November 2024. Of the LCs, 23, worth $5.63 million, were cancelled.

One example cited by the BFIU involves an import of 32,000 kg of oranges from South African firm Zest Fruit for $7.50 per kg (Tk 775).

However, the international market price at the time was Tk 100-Tk 200 per kg, while the local prices ranged between Tk 250 and Tk 400 per kg, indicating over-invoicing and potential money laundering, the report said.

Similarly, another company, Flamingo Enterprise, received a trade licence in April 2023. Official records show it was owned by Md Mosharraf Hossain, but its business address matched Nassa Group's headquarters.

Between July 2023 and November 2024, the company opened 59 import LCs worth $68.4 million.

A review of the transactions found that 13 import LCs, valued at $3.50 million, were issued in favour of Abdur Rashid General Trading, a Dubai-based company owned by Bangladeshi citizen Mohammad Abdur Rashid.

One questionable transaction involved the import of 650,000 kg of dates for $0.70 per kg (Tk 77), significantly below the international market rate of Tk 200 per kg.

This raises concerns of under-invoicing, potentially aimed at shifting funds abroad, the BFIU report said.

The BFIU found irregularities in export trade linked to Firoza Garments, a company owned by Mazumder.

Between 2012 and 2022, the company received export LC orders worth $1.2 billion. While export bills amounting to $1.2 billion were repatriated, funds totalling $11.55 million from 139 LCs remain unrepatriated.

Under the Money Laundering Prevention Act, 2012, failure to bring back repatriable funds constitutes money laundering.

The report suggests that Mazumder and Firoza Garments may have funnelled funds abroad under the guise of exports.

Mazumder, who founded Exim Bank in 1999 with former National Bank banker Shahjahan Kabir, took Tk 4,717 crore in loans from the lender through 18 shell companies.

The Shariah-based bank -- which counted Mazumder's wife, Nasreen Islam, as one of its directors -- approved the loans despite collateral worth only Tk 486.43 crore, the BFIU report said.

Under central bank rules, a bank director cannot take loans exceeding 50 percent of their shareholding in their own bank.

To circumvent the restriction, several directors, including Mazumder, allegedly took out large sums through shell companies.

Two such companies -- Flamingo Enterprise and Madina Dates & Nuts -- received substantial loans soon after their establishment.

Exim Bank -- where Mazumder and his wife held 6 percent shares after transferring a portion of their shares in November 2022 to their children Walid Ibne Islam and Anika Islam -- granted Tk 270 crore to one account within months of opening without proper collateral.

The funds were funnelled to other Nassa Group companies, including Nassa Spinners Garments, Nassa Hi-Tech Wash and Nassa Basic.

Funds were also allegedly withdrawn from Exim Bank and transferred to Nassa Group officials, with some amounts reportedly used to purchase land.

Apart from EXIM Bank, Mazumder and companies linked to him secured a total of Tk 11,104.71 crore in funded and non-funded loan facilities from 20 banks and one non-bank financial institution.

Of the sum, Tk 2,620 crore was taken from Islami Bank, Tk 1,938 crore from National Bank, Tk 1,241 crore from IFIC, Tk 757 crore from Social Islami Bank, Tk 295 crore from United Commercial Bank and Tk 836 crore from First Security Islami Bank.

While the BFIU report does not explicitly mention any irregularities regarding the loans, it underscores the vast scale of Mazumder's financial dealings across the banking sector.

The report highlights how Mazumder, using his influence, orchestrated financial transactions benefiting his business empire.

Mazumder was the chairman of the private bank owners' forum Bangladesh Association of Banks for 17 years -- a position he leveraged to extract benefits from the previous Awami League regime of 15 years.

After the AL-led government fell on August 5 last year, the BFIU ordered the freezing of Mazumder's and his family's bank accounts while the central bank reconstituted a new five-member board for Exim Bank with Mazumder and his wife.

The Bangladesh Bank also commissioned a forensic audit of Exim Bank by global accountancy firm Ernst & Young to assess the lender's asset quality.

As part of the probe, Exim Bank Managing Director Mohammad Feroz Hossain was placed on a three-month leave.

Md Akhter Hossain, the acting MD, told The Daily Star that he was unaware of the BFIU findings as he joined the bank only recently.

Ranjan Chowdhury, vice-chairman of Nassa Group, denied all allegations of money laundering and financial misconduct. He stated that the claims were baseless and lacked factual or legal merit.

He emphasised that Nassa Group had always complied with BFIU regulations and provided requested information when required.

"There are no irregularities, no wrongdoing and certainly no shell companies as alleged," Chowdhury said.

Mazumder, who was arrested in October last year in connection with a murder case during the July uprising, remains in jail.

The BFIU report has been submitted to the Anti-Corruption Commission and the Criminal Investigation Department for further action.