Finance Minister AMA Muhith’s comments yesterday on the Sonali Bank loan scam — that the swindle of Tk 4,000 crore was a trivial amount –surprised many, including a former minister, an economist and a banker.
“Here, my banking crisis — which is not a crisis at all,” Muhith said.
“It is a matter of Tk 3,000 or Tk 4,000 crore. Nonsense! But you [media] are harming the banking sector by publicising it. The sector is now confronted with questions whether all of it had crumbled down.”
“People for nothing are raising hue and cry on the issue and tarnishing the image of the country,” said the finance minister, while criticising the media coverage surrounding the matter.
Muhith then went on to put the blame for the loan scam on the central bank.
“It happened because we do not properly function. Those who are responsible for surveillance have failed to detect it.”
The comments came at a roundtable on “Role of Information and Communication Technology in Combating Corruption”, at the Ruposhi Bangla Hotel in the capital.
Muhith also attacked the Integrity Unit of the World Bank (WB), calling it a “jihadi institution”.
“The WB Integrity Unit does not believe in right means for right ends. I will give you some examples to describe its problematic behaviour. They eavesdrop illegally which is totally, totally, totally unacceptable.”
Muhith further said the unit knowingly dealt with questionable characters.
“This unaccountable office and the jihadist spirit, they are very much at ease with corruption.”
He said the black money has to be accepted as a reality in Bangladesh, and hence the scope to legalise it would soon be abolished.
The comments evoked strong criticism from a number of participants at the event and from eminent commentators.
Dr Debapriya Bhattacharya, distinguished fellow of the Centre for Policy Dialogue, said it is the manner in which the banking sector was infringed that was worrying.
“It is not about the quantity of money which has been embezzled. It is more about the way it has been done. It is not the quantity but the process, which has violated all prudential regulations of banking sector management.”
He said as a major champion of good governance the finance minister should be happy that the media has been highlighting the abuse of the banking sector.
“And it would have strengthened the hand of the finance minister and the central bank — to put things in order. But he did the opposite thing.”
The economist said the total safety net budget of the government is Tk 17,524 crore.
“Now we are talking about Tk 4,000 crore, which is 23 percent of the all the funds the government has managed for the poor.”
“It is almost 2 percent of the total budget. How can we say that this amount is trivial? So, I am really surprised.”
With regards to comments on the Integrity Unit of the World Bank, he said the finance minister should have taken the issue to the bank’s board.
“I am surprised again because Bangladesh is a co-owner of an inter-governmental bank. I think we should take it up with the World Bank board instead of telling this to the Bangladeshi media.”
Dr Iftekharuzzaman, executive director of Transparency International Bangladesh, said: “Why is he saying so? His comments brought the issue of collusion of powerful government officials to the fore. It is not acceptable to us.”
He said the minister’s comment that the black money has to be “accepted as a reality” is unconstitutional and contrary to the political commitment of the government.
KM Khalid, a ruling party lawmaker, who incidentally spoke after the finance minister left the event venue, said he was surprised at the minister’s remark that the corruption of Tk 4,000 at Sonali Bank was not a big amount.
Former education minister Osman Faruk, who also attended the programme, said this type of mentality undermined the government commitment to uproot corruption, citing the recent incident involving the railway minister where he slapped a railway staff for corruption.
“The employee was close to losing his job. But now the finance minister is saying that the Tk 3,000 to Tk 4,000 crore loan fraud is nothing,” Faruk told The Daily Star.
A former central bank governor who preferred not to be named said he was surprised by the finance minister’s comments on the scam at Sonali Bank.
Ibrahim Khaled, chairman of Krishi Bank, said what the finance minister said was his view.
“But as far as I have known, these are not loans but a case of fraud and irregularity. The money has been withdrawn from the bank through illegal ways.”
Khaled, also a former central bank deputy governor, said the amount is, in reality, very significant.
“We are worried because irregularities have occurred at financial organisations.”
Khaled, who led the stockmarket scam probe in 2010, said the case warrants utmost attention.