'Regulators' term Dr. Hasan Imam as fund glutton

 
Bangladesh's financial sector has been going through an abnormal scale of corruption, anomalies and anarchy for last several years which has hit news headlines over and over again. Some branded financial fraudsters in collaboration with some unscrupulous politicians and immoral bureaucrats have been acting viciously behind the rampage. Ruling party Awami League said in their election manifesto that uncompromising steps would be taken to restore good governance and accountability in the country's financial arena.

In continuation of the above unabated vices on the financial turf, the name of Bangladesh RACE Management PLC has of late glared up as a transgressor which has allegedly plundered voluminous sums of investors' money from mutual funds with different banks and has transferred all these stolen money abroad through unauthorized channels.

The Bangladesh Financial Intelligence Unit (BFIU) has ordered all the scheduled banks of the country to freeze all banking transactions by the 12 mutual funds being run by the Bangladesh RACE Management PLC.

The order issued on 10 June 2024 was for 30 days, which means the bank accounts of the mutual funds will remain frozen till 9 July 2024, according to the BFIU. BFIU authorities told the media that they took the above action after receiving specific allegations from Bangladesh Securities and Exchange Commission (BSEC).

Earlier on 6 June 2024, BSEC halted transactions of any securities held by the mutual funds managed by RACE, the largest private sector asset manager.

The BSEC's action was based on a recommendation from its investigation committee, which was recently formed to scrutinize things within the mutual funds being managed by Race. BSEC officials said RACE Managing Director Dr. Hasan Imam has been facing two cases - one case filed in November 2023 by a mutual fund investor named Ruhul Amin Akand, complaining that Hasan Imam embezzled public investors' money; and the other case was filed by RACE shareholders.

The investigating officers appointed by regulators have told The Asian Age that Dr. Hasan Imam escaped to Malaysia who studied in Yale University, USA. All the embezzled funds have been laundered abroad reportedly. Latest updates show that Dr. Hasan Imam has returned to Bangladesh and has started his unlawful financial activities once again.

BSEC officials have said that Dr. Hasan Imam tried to put pressure on regulators and the top officials of different banks through sensitive government high-ups to reverse the circumstances in his favour. Bangladesh Bank (BB) and BSEC have referred to Hasan Imam as a 'fund glutton' and a diabolic embezzler. Concerned law and order forces have been notified about the irregularities and financial vices committed by Hasan Imam. However, financial experts have stated that the regulatory authorities should have taken actions against this issue much earlier.

RACE manages ten mutual funds - EBL First, Trust Bank First, IFIC Bank First, First Janata Bank, Popular Life First, PHP First, EBL NRB, AB Bank First, Exim Bank First, First Bangladesh Fixed Income Fund; and two open-end funds - RACE Financial Inclusion Unit Fund and RACE Special Opportunities Unit Fund.

Total assets under RACE were over Tk3,000 crore, according to the BSEC while the company's paid up capital was 5 (five) crore taka. Bangladesh General Insurance Company (BGIC) and Investment Corporation of Bangladesh (ICB) are two trustees of RACE Asset Management PLC.

According to BSEC laws, only Chief Executive Officer (CEO) or Managing Director of a company is authorized to deal with fund management. Bangladesh Bank and BSEC have taken a very strong stance and zero tolerance over the matter. Additional Superintendent of Police Jewel Chakma PPM has requested BFIU for detailed facts and figures about Dr. Hasan Imam through a letter.

Dr. Shamsul Alam, former Planning State Minister said a couple of days ago that every year 7 to 8 billion dollars are being laundered from Bangladesh to foreign countries. Dr. Shamsul Alam blamed this phenomenon for the acute dollar crisis in Bangladesh.

President of Bangladesh Economics Association Professor Dr. Abul Barakat said that corrupt people who are directly associated with money laundering and stealing funds from banks and financial institutions have close ties with influential political leaders, financial watchdogs while the regulatory authorities are also carefree about them before it is too late.

Former adviser to caretaker government Dr. Wahid Uddin Mahmud said, "Just a handful number of scammers have gobbled up Bangladesh's financial institutions, stock markets, insurance companies, banks etcetera. Everyone knows them but still no remarkable action is being taken against them for mysterious reasons."

World Bank's former Lead Economist in Dhaka Office Dr. Zahid Hussain said, "Activities by financial regulators have become highly controversial because they are not being able to persuade banks to recover huge sums of defaulted loans while at the same time money laundering has been going on without hindrances. No substantial action has been yet taken against any financial fraudster in Bangladesh. The situation will get even worse if rule of law and good governance cannot be established without delay."

General depositors have urged the authorities concerned to take immediate actions against RACE Asset Management PLC so that depositors do not lose their investments. Otherwise RACE Asset Management PLC may turn out to be another People's Leasing and Financial Services Limited owned by notorious PK Halder.