Wednesday, November 21, 2018

Bangladesh Bank removes NRB Commercial Bank MD for corruption

  • Senior Correspondent,
    Published: 2017-12-06 15:24:37 BdST

Central bank investigators have stacked ten specific allegations against Dewan Mujibur Rahman. Photo: NRB Commercial Bank.

The central bank has fired NRB Commercial Bank’s top official after it found evidence of corruption and irregularities against him.

Dewan Mujibur Rahman, who served as the managing director and CEO, has also been barred from working in any bank or financial institution for two years.

Bangladesh Bank’s spokesman Subhankar Saha said the directive by Governor Fazle Kabir was sent to the bank on Wednesday after the central bank’s investigation team stacked ten specific allegations against him.

“The central bank’s investigation revealed that loans have been approved in breach of rules in several board meetings in the absence of directors,” said Saha, an executive director with Bangladesh Bank. The signatures of those directors were forged.

Bangladesh Bank’s move comes less than two weeks after it took the initial step to remove the top official of the troubled Farmers Bank.

On Nov 27, its Managing Director AKM Shameem was served with a notice seeking an explanation on 'failure to perform his duty and violating the central bank's orders'.

Hours later, the bank’s chairman Muhiuddin Khan Alamgir, an Awami League leader and former home minister, stepped down.

After gross irregularities over disbursing Tk 7 billion in loans by the NRB Commercial Bank surfaced last year, the central bank appointed an observer for the lender.

In March this year, the central bank served notice on the bank’s chairman and managing director.

It said the board led by Farasath Ali has failed to protect the interest of the depositors.

Managing Director Rahman has also failed to perform his duties, the central bank said then. It concluded that the severe forgery and frauds that occurred were criminal offences.

Islam was then also served with a separate notice, referring to the banking law’s Section 42, which says the central bank can remove top officials, if it deems necessary for the wellbeing of the lender.

NRB Commercial Bank was granted the licence to operate in 2013. Its Chairman Farasath Ali has served as the president of the ruling Awami League’s US chapter.

Rahman joined the bank as its first managing director and CEO and his term was extended last year.

Prior to NRB Commercial Bank, he worked for the state-owned entities BASIC Bank, Janata Bank and Karmashangsthan Bank. He has also worked for private bank, Mercantile Bank.

Early in 2017, the Anti-Corruption Commission quizzed the bank’s chairman Ali on allegations of corruption.

The charge against Ali is that he collected premiums on shares sold to investors and showed the funds as investments by him and his family members, which is in effect an embezzlement.