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Bangladesh already has MLATs with India and South Africa.
Zahid Hussain, former lead economist at the World Bank’s Dhaka office, cautioned that treaties alone are insufficient, because laundered funds are, in his words, “very footloose”.
Once launderers learn that Bangladesh has signed an agreement with a particular country, they move the money elsewhere, forcing investigators to begin the chase anew.
“You are chasing a moving target,” Zahid said.
Zahid is sceptical about the prospect of recovering much of the funds, with legal obstacles adding to the challenge.
“The possibility [of recovering the funds] is very low,” he told The Daily Star yesterday. He explained that the legal process lies outside Bangladesh’s jurisdiction.
“One has to apply the laws of the country where the money entered. First, it must be frozen, then seized, and then transferred by applying the laws of both countries,” he said.
Even securing a freeze is only the beginning. Authorities must prove not only that funds left Bangladesh illegally, but also how they were originally earned, since both legitimate and illicit money flows abroad. “That’s why I say the process is very long,” Zahid said.
The picture is more encouraging where assets have been sunk into physical property, according to him.
Cases involving real estate investment, such as that of Saifuzzaman Chowdhury, former land minister under the Awami League government, offer better prospects.
“You can sell them and move the cash, but you cannot move the house itself.” By contrast, he said, “assets like cash in banks, the share market, or bond markets can travel very easily.”
Additionally, the forensic work required to trace funds is formidable. “One has to identify who took the money, through which route, what form it is in now, and where it is invested,” Zahid said. “It requires capacity and involves costs, and after spending for it, the return you might get is not certain.”
To sharpen its asset recovery efforts, the BFIU has established a dedicated Stolen Asset Recovery Division.
The unit has received advice, technical assistance and training from international bodies, including the US Department of Justice, the International Anti-Corruption Coordination Centre, the Stolen Asset Recovery Initiative and the International Centre for Asset Recovery.
Bangladeshi courts have ordered the attachment of immovable properties worth Tk 8,900 crore and the freezing of movable assets worth Tk 4,400 crore held overseas -- a combined total of Tk 13,200 crore.
To enforce those orders, 23 mutual legal assistance requests have been dispatched to relevant jurisdictions, with another 21 in preparation.
According to the White Paper Drafting Committee established by the interim government, illicit financial outflows from Bangladesh between 2009 and 2023 totalled an estimated $234 billion, an average of $16 billion a year.
An inter-agency task force, comprising 11 members from across the government and chaired by the governor of Bangladesh Bank, was formed in September 2024 to coordinate recovery efforts and prevent future outflows.
Data from Washington-based think tank Global Financial Integrity (GFI) underscores the severity of the problem. In a report published on March 27, the organisation estimated that Bangladesh lost approximately $68 billion to illicit financial outflows between 2013 and 2022 -- about $6.8 billion a year.
Zahid noted the sharp deterioration. Between 2003 and 2012, the figure was $1.3 billion. “It has increased sixfold,” he said.
Of the total, around $32.8 billion flowed to advanced economies, according to the report.
GFI’s analysis, covering 24 developing Asian economies, placed Bangladesh among the 10 worst-affected countries in the region.
The dominant mechanism, Zahid said, was trade misinvoicing: under-invoicing in export and over-invoicing in import.
“For those matters, the roles of the Financial Intelligence Unit and the NBR [National Board of Revenue] are the most significant,” he said. “They must take on this role and increase surveillance.”