A difficult ride for banks

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Shamsul Huq Zahid
The government has frozen 35 fixed deposit receipts (FDRs) worth Tk 27 million, reportedly, belonging to former BNP minister Barrister Moudud Ahmed.
Moudud invested his money in those FDRs against the names of some 'fake' individuals. That is what the officials of the Anti-corruption Commission (ACC) have said sniffing around to detect ill-gotten wealth of a large number of corrupt politicians, bureaucrats and professionals.
Moudud, according to newspaper report, transferred the funds to FDRs opened with several banks against some fake names before his arrest. It is very natural one would try one's best to protect his wealth earned through fair or foul means. The best example was set by chief conservator of forest Osman Ghani who concealed cash worth millions in pillows dumped at the veranda carelessly at his residence with the hope of escaping the notice of the investigators.
As far as his track record is concerned, there is every reason to doubt the source of the money that Barrister Moudud had, allegedly, transferred to so many fixed deposit accounts. The ACC investigators said he did not mention the money thus transferred in his statement of wealth submitted earlier to the anti-graft agency.
But what appears rather surprising is that how could the banks open the fake accounts. They are supposed to gather the necessary information from their clients before opening any account. And the clients concerned are required to fill-up prescribed forms and submit the attested photocopies of their passports or valid identity cards and the photographs of their own and also of nominees, if there is any.
If the FDRs in question were opened against the names of some fake individuals, then the banks might have overlooked those requirements.
In that event, the allegation that the banks are harassing their clients, businesses included, asking them to follow strictly rules and regulations does not seem to be true.
Actually, banks are not anti-graft bodies, nor are they correction centres. They, as commercial entities, are not supposed to see the colour of money-black or white. Their primary job is to take deposits from people promising certain profits and lend the same to others. Banks are aware of the fact that their clients would avoid doing business with them and seek new areas of investment, which are aplenty these days, if they ask too many questions.
But the events of 9/11 in the USA and the so-called terror-financing have brought about a sea-change in the usual way of doing business by the banks and other financial institutions. Their regulators have virtually forced them to ask their clients a lot of questions and follow a host of rules and regulations to help track down 'terror financing'.
The sheer number of banks has made things rather difficult for them. The banks are now engaged in a fierce competition to secure funds and lend the same under constant monitoring by the central bank. However, strong monitoring by the regulator has helped streamlining the operations of the banks and bringing down the share of non-performing loans (NPLs) in the total outstanding loans of the banks.
There is no reason for the banks or other institutions to shy away from doing business in a transparent manner following law and rules concerned.
Those who have amassed wealth through unfair or foul means cannot keep their money buried underground at their homes or concealed in pillows. They either have to deposit the same with banks or take institutional support to invest in stocks, real estate or any other business. If banks and institutions concerned do follow the laws and rules, it would be difficult, particularly for the owners of ill-gotten wealth to make an easy sail.
No country is immune from the vice of corruption. It does exist in every country. The difference lies only in degree. Bangladesh still carries the stigma of the being one of the most corrupt nations. The people are now more aware about the ill-effect of corruption than any other time in the past. But the stigma can only be removed through concerted efforts of all - individual and institutional.