Bangladesh Bank unable to account for 11.81 crore taka in cash withdrawals

Bangladesh Bank has been unable to establish a complete documentary trail for 11.81 crore taka withdrawn in cash from its Credit Guarantee Fund between 2017 and 2019, according to internal audit records reviewed by Daily Waadaa.

The withdrawals were made through 25 cheques from an account maintained at Janata Bank's Motijheel branch. Auditors found that supporting vouchers, expenditure approvals and other transaction records were missing or could not be produced for verification.

The account was jointly operated by Kamrul Hasan Azad, then a deputy director at Bangladesh Bank, and Md Anwarul Islam Talukder. Azad now holds a senior position at the Bangladesh Financial Intelligence Unit (BFIU), the country's financial intelligence agency.

The missing records have prevented auditors from establishing how the withdrawn funds were spent and whether the expenditure complied with the fund's authorised purposes.

The Credit Guarantee Fund was established to facilitate lending to small businesses, particularly borrowers unable to provide sufficient collateral.

Bangladesh Bank sought explanations from the two former account operators in July 2025. Both submitted responses, but the central bank remained dissatisfied.

In a follow-up letter dated November 17, Bangladesh Bank said the documents it had sought had not been properly provided and that the failure was, in effect, obstructing the process of finalising the accounts

Azad denied withholding any records.

In a written response to Daily Waadaa, he said he had followed the required procedures while serving as an assistant director and had submitted the necessary supporting documents to the Credit Guarantee Department.

He did not provide copies of those documents to Waadaa.

The central bank's November correspondence, however, showed that auditors were still seeking the records four months after the initial request.

Talukder, who is now on post-retirement leave, said the transactions had taken place too long ago for him to recall their details.

Bangladesh Bank did not provide a substantive response to Waadaa's questions despite repeatedly requesting additional time.

Cash withdrawals raise questions over banking trail

One transaction drew particular attention from Bangladesh Bank inspectors.

On December 28, 2017, 1.66 crore taka was withdrawn in cash from the Janata Bank account. Four days later, the same amount was used to open a fixed deposit receipt (FDR) at Southeast Bank.

Inspectors described the transaction method as “incomprehensible”.

The use of cash, rather than a pay order or direct bank transfer, meant that the movement of funds could not be traced through a continuous bank-to-bank transaction record.

Although the money was subsequently placed in a fixed deposit, the auditors questioned why such a large sum had been withdrawn in cash for that purpose.

Excluding the 1.66 crore taka deposit, the remaining 24 cheques accounted for 10.15 crore taka in cash withdrawals.

Inspectors also identified a missing cheque dated February 16, 2017, involving 1.36 crore taka.

Janata Bank could not produce a physical copy of the cheque, leaving auditors unable to independently verify its signatories or the recipient of the payment.

The inspection further found that unused cheque leaves were missing from the Credit Guarantee Department's custody.

Bangladesh Bank described the absence of those cheque leaves as “risky”, citing the implications for control over the account.

Audit questions remain unresolved years later

Concerns over the fund's accounts predate the correspondence issued in 2025.

In May 2021, the Bangladesh Bank governor approved a framework requiring annual finalised accounts for the Credit Guarantee Fund.

By August that year, the accounts had been prepared and forwarded to the Internal Audit Department for verification.

The departmental records reviewed by Waadaa, however, do not establish how that verification was concluded.

Four years later, Bangladesh Bank was still seeking supporting documents from the former account operators.

Sources familiar with the matter said Azad talked with the officials at the Credit Guarantee Department after Waadaa began making inquiries, demanding to know who had disclosed internal documents to the newspaper.

The findings follow a separate Waadaa investigation into Bangladesh Bank's SMEDP-2 project, which identified further weaknesses in transaction documentation and internal controls.

In that case, internal auditors were unable to verify the banking trail for seven overseas programmes.

They also identified 1.79 crore taka in cash withdrawals that lacked adequate explanation and an 89 lakh taka travel advance for which tender records could not be produced.

The two cases concern separate funds and projects, but both involved difficulties in establishing complete documentary records for expenditure overseen by the central bank.

—