The Market Monitor Minding the Nation's Business
The failure of government agencies to recover bulk of the $81 million stolen from Bangladesh Bank (BB) in an online heist that was laundered in the country has resulted in a legal tangle between the Bangladesh government and the Yuchengco group’s Rizal Commercial Banking Corp (RCBC).
Bangladesh wants RCBC to compensate its central bank for the remaining $66 million or P3.17 billion of the still unaccounted for funds from the $81 million (3.9 billion) stolen from BB in a cyber theft last February.
The Anti-Money Laundering Council (AMLC), which has been running after the stolen amount, traced its difficulty to a loophole in the Anti-Money Laundering Act (AMLA) that exempted casinos from being covered by AMLC investigation.
Bangladeshi officials maintained that RCBC was culpable for the laundering of the $81 million stolen from BB, thus, it should return the funds.
Bangladesh Minister of Law, Justice and Parliamentary Affairs Anisul Huq told reporters last week that as proof of RCBC’s culpability, it has been penalized by the Bangko Sentral ng Pilipinas (BSP) for being remiss in its responsibilities.
“I expect that RCBC will take the entire liability because this money came into the Philippines through RCBC. And RCBC, having held the money, is responsible to pay us. We do not need to know what happened to the money later on but it did enter Philippines through RCBC and that is what our position is,” he said.
RCBC, however, said it would not pay BB any amount since the latter was negligent; RCBC demanded that BB release the results of an investigation it conducted on the incident.
A lawyer of RCBC also said BB should stop blaming RCBC for the cyberheist and instead produce the results of its investigation to shed some light on what really happened.
“This is the least BB can do,” RCBC External Counsel Thea Daep said in a statement.
Daep cited reports quoting Bangladeshi officials as saying that initial results of their investigation showed that the heist happened with the help of BB insiders. “Shortly after that, BB decided to abort its investigation, which raises a lot of questions, to say the least,” she said.
Thus, she added, “RCBC is not the proximate cause of the theft. They have no case against us. BB was the one who was negligent. We, therefore, urge BB to be transparent to the Philippine government which has done so much to help them and show us who really stole from them,” she said.
Huq, however, said that “whether Bangladesh Bank was negligent or not is not relevant” since what was clear was that the money that left the BB account with the Federal Reserve of New York was received by RCBC.
“And that is where RCBC is liable. It is not for RCBC to point fingers. RCBC should be explaining its part,” he said.
Of the total $81 million stolen from BB, some $15 million has been recovered from casino junket operator Kim Wong.
Huq said the Bangladeshi government has “put forward the demand on the basis that RCBC has already admitted liability and they have also paid the fine that is imposed upon them by the central bank.”
“And from that, it is clearly established that RCBC was very much involved and they have admitted their liability,” he said.
The Bangko Sentral ng Pilipinas (BSP) earlier slapped a P1-billion penalty on RCBC as a result of the money-laundering case.
A high-level delegation from Bangladesh arrived in Manila last November 27 and left December 1 after meeting with local officials.
Aside from Huq, the other members of the 10-man delegation were Dr. Muhammad Abdur Razzaque, chairman, Parliamentary Standing Committee, Ministry of Finance; Mahbubey Alam, Bangladesh attorney general; Bangladesh Bank Governor Fazle Kabir; Eunusur Rahman, secretary, Bank and Financial Institutions Division, Ministry of Finance; Debaprosad Debnath, general manager, Bangladesh Financial Intelligence Unit, Bangladesh Bank; M Masum, private secretary to the law minister; and Mohammad Abdur Rab, joint director, Bangladesh Financial Intelligence Unit, Bangladesh Bank.
The group was scheduled to meet with President Duterte on the last day of their visit but it was cancelled due to a conflict of schedule with Mr. Duterte.
Huq said he does not feel bad that the meeting did not push through.
“It needs to be understood that His Excellency, the President, can be busy in other pressing national matters. So I think that from that it is not something that I should take otherwise. I think in good faith,” he said.
The group met with Senate President Aquilino Pimentel III, instead, and was assured that a hearing on the cyberheist will again be conducted “as soon as possible.”
The group also had a meeting with Finance Secretary Carlos Dominguez III, Philippine Amusement and Gaming Corporation (Pagcor) Chairman Andrea Domingo, and Department of Justice (DOJ) officials.
The Bangladeshi mission also met with Bangko Sentral ng Pilipinas (BSP) Governor Amando Tetangco Jr. and Anti-Money Laundering Council (ALMC) chief Julia Abad.
In all these meetings, Huq said they were given assurances that “the government of the Philippines, in behalf of the government of Bangladesh, will do whatever is necessary” to recover the stolen money and prosecute those who are liable.
Both governments believe that this cyberheist was one of a kind and action should be taken, he said.
Bangladesh Ambassador to the Philippines John Gomes said the Bangladesh government “is quite pleased that cases have already been filed by AMLC.”
He said Dominguez and Justice Secretary Vitaliano Aguirre II have committed that Mr. Duterte has directed full government support to recover the stolen money.
Last May, RCBC’s Board of Directors accepted the resignation of its President and Chief Executive Officer (CEO) Lorenzo V. Tan. Tan has been cleared by the RCBC Board of any wrongdoing in the money laundering involving its Jupiter-Makati branch.
The Anti-Money Laundering Council (AMLC) has filed money-laundering charges against several RCBC officials including its Treasurer Raul Victor Tan, who resigned from the bank last April 20; former RCBC Jupiter-Makati Branch Manager Maia Deguito, RCBC Jupiter-Makati branch Senior Customer Relations Officer Angela Ruth Torres, as well as its National Sales director for Banking Group and Retail Banking Group Regional Sales director. LUIS LEONCIO