Vol. 5 Num 351 Wed. May 25, 2005  

Tk 1 lakh fine against Premier Bank recommended

The Anti-money Laundering Department of the central bank has recommended a Tk 1 lakh fine against Premier Bank Limited for opening false accounts in its different branches.

The department in its recommendations submitted to the BB governor for approval also suggested punitive action against Syed Nowsher Ali, manager, Banani branch of the bank.

The department which recorded statements of 14 branch managers of the Premier Bank on May 3 and 4, made the recommendations after finding violations of the Anti-money Laundering Act and other Bangladesh Bank orders.

The branch managers explained that the fake bank accounts were opened after receiving verbal orders from former managing director (MD) Kazi Abdul Mazid and the manager of Banani branch who maintained liaison between the MD and branch managers.

The Anti-money Laundering Department also recommended issuance of caution notices against the managers of 13 Premier Bank branches.

Nowsher Ali denied the allegation against him when the central bank investigators asked him to explain.

The Bangladesh Bank on April 28 removed MD of Premier Bank Kazi Abdul Mazid as its probe into the private bank's initial public offering (IPO) scam detected his involvement in opening of fake bank accounts.

The BB launched the probe on February 14 after the Securities and Exchange Commission (SEC) on February 12 suspended Premier Bank's Tk 55 crore IPO. The capital market watchdog froze the IPO following the unearthing of 25,000 fake beneficiary owners' (BO) accounts in its preliminary investigation.

On completion of its probe, the BB on March 13 served a show cause notice on the Premier Bank MD asking him to explain in a week why he should not be removed from job.

The MD sent his reply to a three-member BB standing committee headed by Deputy Governor Allah Malik Kazemi. The committee also conducted a personal hearing of the MD but found his explanation unacceptable. It then recommended the BB governor that the MD be removed.

The BB investigation into the Premier Bank IPO scam found gross violation of banking rules in the opening of around 17,000 accounts with different branches of the bank. The accounts were later found fake.