Legal battle to recover central bank funds

It has been three years since the cyber heist in which 101 million US dollars was siphoned off from Bangladesh Bank’s account with the US Federal Reserve. However, Bangladesh has not filed any case in this regard as yet. The new finance minister, AHM Mustafa Kamal has said that a case will be filed within 3 February this year, but he did not clarify who would file the case and against whom the case would be filed. He merely said that lawyers of the two countries would determine the details of the case. Two US legal firms have reportedly been hired for the purpose.

The SWIFT security code had been hacked and the money siphoned off through five SWIFT messages, but till date no visible action has been taken. Immediately after the heist, it was possible to recover 20 million US dollars from Sri Lanka and 14.6 million US dollars from the Philippines. However, 66.4 million US dollars smuggled transferred to the Philippines remains to be recovered.

Bangladesh has been saying from the very outside that the US Federal Reserve is primarily responsible for the heist. It was their erroneous message that allowed the money to be siphoned off from the Bangladesh Bank account. The inquiry committee headed by former Bangladesh Bank governor Mohammed Farashuddin submitted its report in due time, but the report was never made public.

Certainly policy makers tried to say that f the report was published, it would diminish the claim to recover the money from the Philippines. No case has been filed against the Philippines, and so that claim does not hold any substance. The Philippines court has already caught and sentenced the official of the bank there where they stolen money had been transferred. Yet we have not been able to file a single case. That is most unfortunate.

According to the la, Bangladesh will have to file a case within 3 February. There is no guarantee that the money will be recovered if a case is filed. Then again, there is no alternative but to resort to legal battle to recover the money. Negotiations with the two countries where the money was transferred have yielded only insignificant recoveries. It is also necessary to see if any person or organisation is responsible for no case being filed against the Federal Reserve.

If Bangladesh finally manages to file a case against the US Federal Reserve Bank, that’s when the actual test will begin. Competent lawyers must be hired to fight the battle on behalf of Bangladesh. There is the matter of the lawyers’ commission too, which will have to be paid regardless of the case’s outcome. The US lawyers’ commission is extremely steep. Bangladesh must proceed with care and ensure there are no loopholes or loose threads. If the case is lost, the damage will multiply. And the costs of the case will be paid from our hard-earned foreign exchange.