Bangladesh authorities are still trying to recover $81 million taken in 2016 (Pic: Golden Brown/GettyImages)
The US Federal Reserve has agreed to provide technical assistance to Bangladesh's central bank to help in its efforts to bring to justice dozens of senior bank executives and hackers who allegedly stole US$ 81 million (£63 million) in 2016 after breaching its IT systems.
In February 2016, Bangladesh Bank announced that unknown cyber-criminals had stolen as much as US$ 81 million (£63 million) from its account in the New York branch of the US central bank after gaining backdoor access to Bangladesh Bank’s IT systems.
After gaining access to Bangladesh's central bank's IT systems, cyber-criminals used the SWIFT global payments network to request that the Federal Reserve Bank of New York release US$ 101 million (£78 million) in funds, US$ 20 million (£15 million) of which were to be sent to Sri Lanka and the remaining US$ 81 million (£63 million) to be transferred to accounts at Manila-based bank Rizal Commercial Banking Corp (RCBC).
Alert authorities at Bangladesh Bank were able to freeze the fund transfer to Sri Lanka but were unable to put a stop to the transfer of US$ 81 million (£63 million) to RCBC accounts. At the request of Bangladesh Bank, the Federal Reserve Bank also put a stop to as many as 30 additional requests that involved the transfer of over US$ 850 million (£658 million). So far, Bangladesh Bank as been able to recover only US$ 15 million (£12 million) of the total sum.
Last week, Bangladesh Bank filed a lawsuit in the US District Court in Manhattan against RCBC and dozens of the latter's senior employees, alleging that they were deeply involved in the "intricately planned" heist of US$ 81 million (£63 million) in 2016.
The central bank's case was strengthened after the Filipino central bank fined RCBC a total of 1 billion pesos (US$ 19.17 million) in August 2016 for failing to prevent the movement of stolen money via its accounts. Earlier this year, a former manager of RCBC was also found guilty on eight counts of money laundering and a former treasurer and five other employees at the bank are facing additional money laundering charges in the Philippines.
After being fined by the Filipino Central Bank, RCBC's CEO Gil A. Buenaventura said, "While the payment involves a large amount, RCBC believes that this is part of increasing regulatory oversight and restrictions and we will comply with the MB resolution."
Buenaventura added, "With this payment, RCBC affirms its continued viability and determination to fulfill its firm commitment against money laundering, terrorism and other transnational crimes to ensure the stability of the banking system."
However, it remains to be seen if the case initiated by Bangladesh Bank will stand as lawyers representing RCBC have stated that the matter is beyond US jurisdiction as none of those accused are in the United States. Nevertheless, the bank is putting all efforts to recover the lost money in full.
Speaking to reporters in Dhaka, Abu Hena Mohd Razee Hassan, the chief of Bangladesh Bank’s Financial Intelligence Unit, said that the bank had already spent 30 million takas (£275,887) on filing the lawsuit and other related jobs and had also appointed an American law firm.
According to Fozle Kabir, the governor of Bangladesh Bank, the bank has information on where the stolen reserves are kept in the Philippines and that all individuals associated with the cyber-heist of US$ 81 million (£63 million) have been named in the lawsuit.
In a major boost to the bank's efforts, Reuters reported last week that the US Federal Reserve will provide technical assistance to Bangladesh Bank to help it recover the lost money. As part of the assistance, the bank will send employees to testify at hearings and will allow Bangladesh Bank "to interview employees on relevant and factual matters".
The report added that the US Federal Bank and Bangladesh Bank struck an agreement last week to confirm the technical assistance and that the Fed would "provide relevant non-privileged documents and information to Bangladesh Bank or to the court" as well.
Representatives of the two banks will also meet jointly with "relevant agencies or parties in the Philippines to strongly encourage them to assist in the recovery of stolen funds", Reuters added.