Dhaka South City Corporation’s former mayor, Sheikh Fazle Noor Taposh, deposited a significant portion of the organisation’s fixed deposits into his own bank, Modhumoti Bank. He also transferred the corporation’s financial transactions from other banks to Modhumoti.
Since taking office in 2020, he has focused on increasing the corporation’s income. Despite this surge, he did not prioritise development works; instead, he seemed more interested in channelling the corporation’s funds into his own bank.
During his tenure, six booths for Modhumoti Bank were established in Nagar Bhaban and the DSCC’s zonal office, allowing residents to deposit money for various services from the city corporation, while excluding other banks from participation.
Sheikh Fazle Noor Taposh is the founder of Modhumoti Bank, which received approval in 2013 and was initially known as ‘Bank of Taposh’. He remains a director of the bank.
According to DSCC, their fixed deposits totaled Tk 11.71 billion last September. Of this, Tk 5.43 billion - 46 per cent of the total - is deposited in Modhumoti Bank, while the remainder is with Janata and Premier Bank.
City corporation funds were primarily kept in state-owned banks until 2018, when the government changed the rules to allow government agencies to deposit money in private banks. After becoming mayor, Taposh began placing corporation funds in Modhumoti Bank.
In addition to fixed deposits, funds allocated for five of the seven ongoing projects in the DSCC have been deposited in Modhumoti Bank, totaling Tk 4.23 billion - 76 per cent of the total for all seven projects. The remaining project funds are with Sonali and Janata Bank. Overall, Dhaka South City Corporation has Tk 9.66 billion in Modhumoti Bank, encompassing both fixed deposits and project funds.
Iftekharuzzaman, executive director of Transparency International Bangladesh (TIB), argues that compelling the corporation to keep its money in his own bank constitutes a conflict of interest.
He told Prothom Alo that Sheikh Fazle Noor Taposh invested corporation money in a bank he owns, defying his oath. This action is both a conflict of interest and unethical. As a representative of the people, he has broken his promises.
Transferring DSCC’s money right after being mayor
Fazle Noor Taposh served as the mayor of Dhaka South City for four years and three months, having been elected in the February 2020 elections, where only 29 per cent of the votes were cast. Taposh received just over 17 per cent of the total votes.
He officially took office in May 2020. Sources from the city corporation indicate that as mayor, he pressured DSCC to transfer a significant portion of the corporation’s fixed deposits and current transactions to Modhumoti Bank.
An anonymous DSCC officer told Prothom Alo that Sheikh Fazle Noor Taposh would request deposits in Modhumoti Bank after checking the accounts at the end of each month. The officer noted that bills from contractors were often withheld under various pretexts, resulting in more funds being retained in Modhumoti Bank. However, deposits decreased last September due to project expenditures.
Modhumoti Bank was established in 2013, alongside nine other banks approved by the Awami League government out of political considerations. Sheikh Fazle Noor Taposh, a key founder of Modhumoti Bank, is the son of a cousin of former prime minister Sheikh Hasina.
While some of the nine banks approved for political reasons in 2013 are struggling, Modhumoti Bank is in good financial health. In 2018, the Awami League implemented new rules for managing government funds, allowing 50 per cent to be deposited in private banks to stimulate their growth.
Despite attempts to reach him, Sheikh Fazle Noor Taposh did not provide a statement regarding the placement of corporation funds in his own bank. He reportedly left the country two days before the fall of the Awami League government on 5 August and is currently believed to be in Singapore.
In a February 2021 interview with Prothom Alo, Sheikh Fazle Noor Taposh addressed the issue of keeping city funds in Modhumoti Bank. When asked, “As the mayor and a bank director, is it ethically correct to keep the city corporation’s money in that bank?” Taposh responded that while deposits can indeed be kept there, the bank does not generate profit solely from holding deposits.
When added that if the bank does make a profit, he as a director would get a share, he insisted that no matter from the city corporation had reached the board of Modhumoti Bank so he could influence thus far.
However, criticisms regarding this arrangement had already emerged. Former DSCC mayor Mohammad Sayeed Khokon stated in an event on 9 January 2021, that Taposh had transferred billions from the south city corporation to his own Modhumoti Bank.
City corporation sources noted that during Sayeed Khokon’s tenure, city funds were also placed in banks of his choice, highlighting that substantial deposits can yield financial and other benefits.
Prothom Alo attempted to contact Nazrul Islam Khan, the current administrator of Dhaka South City Corporation, for insights on the corporation’s banking practices, but received no response. However, senior officials of the city corporation, speaking on condition of anonymity, reported that the new administrator has instructed the transfer of all city funds to government banks.
Money in Deposit, Less Development Work
The Tk 11.71 billion held in fixed deposits by the city corporation primarily represents security for contractors, funds deposited by applicants for shop allotments, compensation for road digging, and rent from corporation-owned shops.
Allegations have surfaced that the security deposits of contractors are not returned promptly after project completion. Applications for shop allotments are accepted, and lotteries are conducted after significant delays. The process of allotting shops can take years, and road repairs following digging are often not addressed in a timely manner. Consequently, money remains unspent and accumulates in the bank.
For instance, in 2017, south city collected Tk 190 million from 281 applicants for shop allotments in a shopping centre under construction in Dhaka’s Chankharpool. Although construction was slated to begin in October 2017 and complete by October 2019, only the ground floor of the mall has been completed to date. Meanwhile, the money collected from applicants continues to sit in Modhumoti Bank.
A source from the south city revenue department, speaking on condition of anonymity, informed Prothom Alo that funds for additional commercial shop allotments were collected long ago but remain idle in the bank.
‘Failed to meet expectations’
Sheikh Fazle Noor Taposh promised to create a dynamic, beautiful, well-governed, and developed Dhaka during his tenure as mayor. Many believed that, as a member of the “Sheikh family”, he would be able to initiate meaningful changes in the south city by confronting vested interest groups.
However, after four years in office, it appears that no significant progress has been made. Residents continue to suffer from long persisted crises like dengue fever, waterlogging, dilapidated roads, pollution, and dust, while the development of several parks has been stalled for years.
Allegations have also surfaced that Sheikh Fazle Noor Taposh awarded contracts to leaders and activists of the Bangladesh Awami League and its associate bodies like Awami Jubo League, and Bangladesh Chhatra League. Supporters were given opportunities to set up shops in various parks throughout the city, and party members were appointed within the corporation. Additionally, it is claimed that Taposh personally benefited by keeping the corporation’s funds in Modhumoti Bank.
Jabed Jahan, a resident of Old Dhaka and member secretary of the Adi Dhakabashi Forum, told Prothom Alo that while Sheikh Fazle Noor Taposh spoke of numerous changes, he ultimately failed to meet expectations. Instead, there are growing allegations against him for prioritising his own interests and favouring party leaders and workers.
* The report, originally published in the print and online editions of Prothom Alo, has been rewritten in English by Farjana Liakat