Dhaka plans pacts with 12 nations to retrieve black money

Bangladesh is all set to unleash a war on black money.

UNB has learnt that Prime Minister Sheikh Hasina's government is planning to ink taxation agreements with as many as 12 countries for allowing exchange of information in order to bring back black money stashed abroad.

These countries include Canada, the United States of America, the United Kingdom, Australia, Switzerland, Singapore, Hong Kong, the United Arab Emirates, Malaysia, the Cayman Islands and the British Virgin Islands.

According to sources, Dhaka could sign bilateral or multilateral agreements with these countries for bringing back ill-gotten money. And for this purpose, a high-powered committee was recently formed by the government.

Bangladesh Financial Intelligence Unit (BFIU) head Abu Hena Mohammad Razee Hassan has been appointed as the head of the committee. Senior officials from the Anti-Corruption Commission, the National Board of Revenue (NBR), the Foreign Ministry and the Customs Intelligence and Inquiry Department have been roped in as committee members. 

This committee, sources said, has prepared a report on recovering black money through various effective ways, including by reviewing individual tax evasion cases and formulating policies for facilitating exchange of information with foreign countries, including tax havens. 

And BFIU was the one that recommended signing pacts with 12 countries for the same.

According to Finance Ministry sources, the working committee to prevent money laundering and terror financing, chaired by senior secretary of Financial Institutions Division M Asadul Islam, recently approved the recommendations of BFIU at a recently held online meeting.

In that meeting, the panel also decided to prepare a database to determine how much black money has been stashed in foreign banks, identify the hurdles to bring back the same and constitute a high-powered committee to prevent money laundering in the future, the sources said.

The annual conference of Asia Pacific Group on Money Laundering was supposed to be held in Bangladesh this year, but it was cancelled due to the Covid pandemic. The next meeting is slated for February 2021 in Malaysia. At that conference, Bangladesh, the sources said, would seek help from participating countries to bring back laundered money.

In its meeting, the working committee to prevent money laundering and terror financing also decided to urge foreign countries to initiate a process where they can seek information from Bangladeshi citizens about the source of money. This could turn out to be an effective step in curbing money laundering.

The panel also suggested increasing the capability and cooperation among the office of the Attorney General, the Finance Ministry, the Commerce Ministry, the Law Ministry, the Anti-Corruption Commission, the National Board of Revenue and Bangladesh Bank, the sources said.

Another suggestion that came up at the meeting was the introduction of economic intelligence in Dhaka's foreign missions. Anti-Corruption Commission personnel could be posted in such missions to gather information about black money illegally kept in banks of those foreign countries, the sources said.

The committee also suggested going for an asset recovery and tax recovery system to reign in tax evaders and those having black money abroad. Members also called for strict adherence to Bangladesh Bank's guidelines for containing money laundering through over and under invoicing on products, services and shipments, multi-dimensional invoicing in imports and exports, and false declaration in exported products and services.

The Global Financial Integrity (GFI), which published a report in March, said that  Bangladesh lost Tk 63,924 crore ($7.53 billion) a year between 2008 and 2017 to trade misinvoicing.

According to Swiss National Bank's (SNB) annual report for 2019, deposit of money by Bangladeshi individuals and enterprises went down by 2.38 percent to 603 million Swiss Francs (CHF) in 2019 from 617 million CHF in the previous year.