IMF for checking five high-risk banks

At least five high-risk banks in Bangladesh ought to be checked regarding money laundering and terror financing, the IMF suggests and gives a timeline up to next June.
The International Monetary Fund (IMF) has put this task among structural benchmarks for next 12 months as the executive board of the multilateral lender completed a second review of its US$4.7-billion lending package and approved the release of $1.148 billion in the third tranche.
The lender interpolated the matter into the structural benchmark with an objective to improve Anti-Money Laundering (AML) and Combating Financing of Terrorism (CFT) status, says an IMF document released Tuesday.
Finance Division officials say the IMF has developed AML/CFT examination procedures as part of its technical-assistance project and wants to check any involvement of Bangladeshi banks in money laundering and terrorism financing by using the method.
Former junior planning minister Shamsul Alam recently said every year some $7.0 to $8.0 billion is being laundered overseas and that is the main reason behind the ongoing severe dollar crisis in the country.
Most part of the money is being siphoned off through trade under-and over- invoicing, economists say.
A US-based watchdog, the Global Financial Integrity (GFI), in a report in 2021 said Bangladesh annually lost nearly $8.27 billion on average between 2009 and 2018 from mis-invoicing of values of export and import of goods by traders as they want to evade taxes.
However, relevant state agencies have not been successful in preventing such money laundering or bringing back the money.
The IMF in the structural benchmarks for the next one year also has mandated that at least 50 per cent of the value of central government transactions, excluding interest payments, subsidies, loans, equity, and liabilities, have to be carried out
through electronic funds transfer (EFT) to improve budget execution and enhance fiscal transparency.
Also by the end of next June, the government will have to approve a development-project proposal (DPP) for digital transformation of income- tax administration, including e-return and e-payment framework, aiming to increase revenue collection to cover priority spending.
The IMF-designed priority to-do list includes issuance of guidelines by the ministry of finance and Bangladesh Bank to reform the primary-dealer system for government securities with an active set of players, focused on market-making functions, and with a balance between privileges and obligations by the end of June next year to help develop domestic capital market.
To increase revenue collection for meeting the priority spending, the IMF asks the National Board of Revenue to finalise Medium- and Long-term Revenue Strategy covering indirect and direct taxes and an accompanying implementation framework by the end of December next.
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